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Verizon Seeks to Stem Fixed-Line Losses by Bundling Landline with Wireless


03/10/2007

U.S. telecom giant, Verizon Communications, has introduced a new service that integrates landline and cell phone services, amid growing competition from cable companies and other wireless carriers.

Verizon’s new bundle of fixed and mobile services comes with unlimited local and long distance calling on a home phone, plus 200 wireless minutes, free home-to-mobile calls, and free cell phone calls within the Verizon Wireless network. At $60/month, the plan is aimed at existing home phone users who don’t yet have cell phones, as well as younger subscribers who’ve never had a traditional landline.

“I think at the end of the day, what they’re trying to do is stem their losses for home phone service, because what’s happening now is those customers are being poached by the cable operators,” commented Technology Business Research analyst, John Byrne.

This strategy is far from proven, however, and according to Byrne, Verizon may not be offering enough of a discount to generate much customer enthusiasm.

“Then you have to work through the equation,” Byrne said. “Am I giving up revenue from my wireline customers by giving them this discounted offer, or at the end of the day are you expanding your audience?”



 

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