AT&T (News - Alert) has announced that they will be phasing out traditional landline services in a few designated areas in rural Alabama and suburban Florida by 2020. This effort by AT&T is an important shift in telecommunications technology from both a business and consumer perspective. Until now, most customers have had a choice in choosing to keep their traditional landlines, or moving to a Voice over IP or other fiber-optic hard line.

AT&T is planning to intentionally move away from Time-division multiplexing (TDM), the old standard in traditional telecommunications in favor of Voice Over Internet Protocol (VoIP) or other wireless, digital services. Business wise this makes sense for several reasons. First, as landline usage declines, new technology allows new avenues to engage and retain customers. Secondly, it builds new infrastructure in rural areas.

According to Jeffrey Sparshot’s article (Sparshott, 2013) online at the Wall Street Journal, “Just 71 percent of households had landlines in 2011, down from a little more than 96% percent 15 years ago.” That is a 25 percent -reduction over that period and the decline is expected to continue. Eventually, the landline may become extinct on its own, but the new infrastructure will provide an alternate service for the customer base. The same customers will likely prefer a digital phone line with internet access. This also gives AT&T the chance to bundle a digital or fiber optic line with internet access, keeping up with the trend set by Verizon Fios and some cable providers.

According to the Pew (News - Alert) Research Foundation, our attitudes in the U.S. have shifted in regard to what items we consider necessities vs. luxuries. In 2006, they reported changes in attitudes about 14 every day items and the change in attitude that respondents had about them. From a consumer perspective, the customers in rural areas may appreciate upgraded services in their areas, especially if they do not already have high speed internet. The VoIP option will allow customers cheaper options for long distance and/or global communications.

In all likelihood, there will be growing pains as AT&T goes through the transition. Some customers will be happy. Others may grumble at the loss of the analog phone lines, but much like the conversion of TV to digital programming in 2009, this is just another sign of the times.