October 11, 2013 in City

CenturyLink may set own landline rates

By The Spokesman-Review
 

OLYMPIA – If you want the surest sign that the telephone hanging on your wall or resting on your desk is on the way out, this may be it: Washington regulators may soon allow the state’s biggest provider of home phone service to charge whatever it wants.

What’s more is that CenturyLink rates aren’t likely to change much anyway.

“We don’t think they can do much because, in our view, all (a big rate increase) is going to do is accelerate people dropping the landline into their homes,” said Brian Thomas, a spokesman for the Washington Utilities and Transportation Commission.

“A lot of people are cutting the cord.”

Prices didn’t jump dramatically when the WUTC granted similar authority to Frontier, the state’s second-largest provider of landlines, this summer. Frontier’s home rates went up $1 a month at the beginning of October.

CenturyLink, which merged with Qwest and provides traditional phone service to Seattle, Spokane, Tacoma and most of the state’s metropolitan areas, has seen a 60 percent drop in landline customers since 2001 as people, particularly teenagers and young adults, have gone exclusively to cellular phones. From about 2.7 million so-called access line customers at the start of this century, it was down to slightly less than 1.1 million at the start of this year.

Stodgy old Spokane isn’t hanging on to its landline phones at a greater rate than tech-savvy, hip Seattle.

“It doesn’t matter where you are in the state,” Kerry Zimmer, a CenturyLink spokeswoman said, the dropoff is about the same.

About a third of all phone customers only use cellular at home. Another third use some other system, bundling it with the cable television line or through the Internet. Not all the drop in landline customers is directly related to competition from cellphones, Thomas said. In 2001, which was a high-water mark for that service, many people got their Internet over a phone line, and some ordered an extra line, one for their computer and one for talking. That pretty much went the way of the VCR and the Walkman.

Requesting expanded authority to set rates, technically an alternative form of regulation known as AFOR, was a condition of the merger agreements between CenturyLink, Qwest and Embarq to harmonize the rates, Zimmer said. Many customers won’t see any change for years, because their home phone service is “bundled” with their Internet service at a rate that was guaranteed for five years.

The commission is holding a hearing on the AFOR next Wednesday. The change doesn’t affect other CenturyLink services like cable, which the commission doesn’t regulate.

Carl Gipson of Frontier – which serves Everett, Wenatchee, the Tri-Cities and some rural areas – said the dropoff of customers has been negligible from raising monthly residential rates $1 in Washington and $2 in some other states.

“It’s safe to say plain old telephone service is in the process of becoming archaic for some people,” Gipson said. But until something better comes along, businesses will still need landlines for fax machines, credit card services and alarm systems. “Five years from now, it will be almost – but not quite – extinct.”

Although “cutting the cord” has become common, there are times, particularly in emergencies with long power outages, when landlines remain the most dependable phones. That’s because when the power goes out at your house, and the battery on your cellphone runs down, the landline phone can still work. It gets its juice from the central office.


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