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Time to Ditch Your Land Line?

Let's get a show of hands. How many of you still have a rotary phone? That's what we thought.

Rotary phones have nearly gone the way of the Model T and Kozmo.com. It's only a matter of time before a landline phone joins Pink Princess rotaries, vintage Bionic Woman lunch boxes, and macrame plant hangers on the collectibles area of eBay (Nasdaq: EBAY  ) .

It's common knowledge that many of the major telecom concerns' wireless businesses have been ringing off the hook, while landline-based revenues have been put on hold or worse. And don't forget the people who have ditched their landlines for voice over Internet protocol, or VoIP, with services like eBay's Skype.

More and more consumers are doing their calling on the move these days. Research & Markets recently said that 9% of U.S. wireless subscribers are cell phone-only, and it believes that by 2009, that figure will increase to 37%. Should you ditch your landline for cell-only service, too?

Cutting the cord
According to RBC Markets, wireless has a whopping 70% penetration in the U.S. now. Given that scope, many of those people may soon take the plunge into mobile-only communications.

Why cut the cord? It's not just the redundancy of basic voice communication (and the extra bill). Cell phones often include free long distance (although at the wrong time or place, with the wrong plan, it may be anything but free), as well as must-haves like caller ID, voice mail, and call waiting, some of which represent extra fees on the typical landline bill.

Furthermore, a cell enables callers to contact you no matter where you are (a mixed blessing, for some of us). You also get hot new communication technologies like text messaging, which is all the rage with the kids (who we'll talk about later), and Internet connectivity.

There are other, less obvious reasons to go cell-only. If you're a frequent business traveler, or even just a busy, sociable type, chances are you're using your cell most of the time anyway. If you're a young person with a slew of housemates, it gives you a dedicated line that saves a lot of headaches. Or consider folks in long-distance relationships. If you're never home, and everybody knows you're never home, is that landline just gathering dust?

Go wireless?
Many consumers see the logic of going cell-only, but the shortcomings of service still give us pause. (The monthly Sprint (NYSE: S  ) cell phone andVerizon (NYSE: VZ  ) landline bills in my mailbox expose my conventional position on this issue.)

For example, what if there's an emergency? Landlines allow 911 operators to pinpoint your exact address; cell phones don't. Some cells use GPS features, but it's still not exact data (for example, if you live in an apartment building). If there's a prolonged power outage, how do you juice up?

There are other factors to consider before cutting the cord altogether:

  • Darn kids: Family size -- and the presence of teenagers -- can be a real concern. Given how teens gab on the phone, you could easily go over your plan's allotted minutes. In addition, you'd probably need a cell phone for each family member, as opposed to an old-fashioned phone in each room to tap a single landline. Although there are family-friendly mobile plans, let's face it: A landline is probably the cheapest bet if Chatty Cathy and Gabby Gabriel live in your house.
  • The dead zone: At times, cell phones do still drop calls. I'd argue that cellular networks have become far more reliable than in their infancy, but there's still the possibility that you could deal with some downtime. Plus, cellular networks can get overloaded -- that definitely happened after the 9/11 terrorist attacks in 2001 -- or fail during massive power outages.
  • The 911 hangup: Look into your local emergency dispatchers' capabilities. Only 58% of U.S. emergency dispatch centers have the technology to track cell phone calls. That doesn't mean you can't call 911, but emergency workers may have a harder time finding you in case of a dire emergency.
  • Talk ain't always cheap: This goes hand-in-hand with teen talk-a-thons. If you exceed the minutes in your cellular calling plan, you could face formidable overage fees, to the tune of $0.35 to $0.50 a minute. Most calling plans are complicated, too; they charge differently for day, evening, and night, or "off-peak," "out-of-plan," or whether you're "in-network" or not. You don't want to get blindsided with unexpected, astronomical bills that far surpass the old ones.
  • Cell's not the only line in town: There are other options -- like signing up for a VoIP service like Vonage or Skype. Many people swear by them, with flat rates and unlimited long-distance calling features. However, there are also 911 issues to deal with, as well as the idea that their services depend entirely on your ISP and your power company.

  • Just when you thought it was safe: Although past researchers debunked the cell phone/brain tumor connection, Swedish researchers have released a study that apparently links heavy cell phone usage to cancer. If such studies worry you, and you're of the "an ounce of prevention is worth a ton of cure" persuasion, purchasing a hands-free headset for your cell phone is a simple enough solution.

Hang up, cash in
If the preceding criteria work in your favor, think of the extra money you could save. I know I could cut my voice communication bill in half by ditching my landline -- saving $43 a month.

Analyze your bills and see how cost-efficient it would be to pare down to a single phone service. Calculate the amount of money you might save over the course of a year. You might be surprised at how much you can save -- maybe even enough to treat yourself a vintage Pink Princess phone on eBay.

Dial up further Foolishness:

Alyce Lomax does not own shares of any of the companies mentioned.


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Alyce Lomax
TMFLomax

Alyce Lomax is a columnist for Fool.com and an analyst for Motley Fool One. Since 2010, she has managed the real-money Prosocial Portfolio, which integrates socially responsible investing factors into stock analysis.

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