Naked broadband sends traditional phones into decline

Landlines are not needed with naked broadband. Photo / Thinkstock

Increasing popularity of naked broadband - supplied without the need for a landline - is contributing to the demise of the traditional fixed phone line in New Zealand households.

Vodafone says 40 per cent of its new broadband customers opt not to have a fixed landline.

The move to hang up traditional landlines has also been borne out by research firm International Data Corporation (IDC), which notes the number of nationwide fixed line connections has dropped at a rate of about 1.4 per cent a year over recent years, from 1,314,000 in 2007 to 1,258,000 now.

It is a trend that is being seen worldwide - New Zealand's drop of 8 per cent in landline connections between 2007 and 2011 is less than Western Europe's 16 per cent.

But Shane Minogue, of IDC, said he expected New Zealanders to give up their fixed lines at a faster rate in future with the introduction of fibre technology.

New households in particular were opting for naked broadband and cellphones, or using offerings such as Woosh's, which allowed a smartphone to double as a home line. In many cases it is cheaper - cellphone plans are available offering 160 minutes of calling for $29 and naked broadband can be as cheap as $35 a month.

A traditional landline through Telecom costs between $41 and $50 a month, depending on where you are in New Zealand.

It was only free landline calls and the quality of internet services that made people want to hold on to their landlines, Minogue said.

He said as New Zealand's internet reliability improved, more would make the move.

Minogue predicted the rate of households giving up landline connections would increase to 3 per cent or 4 per cent over the next four years. Canstar Blue released survey results this week showing that a third of those born in the 1980s and 1990s do not have landlines.

Vodafone spokeswoman Michelle Baguley said those opting for naked broadband were young, urban professionals.

"They embrace technology and are highly social. They work hard and play hard, so often spend a lot of time out of home and on the go. Often they can be flatting or couples with a high household income. There is a very broad range of ethnicities."

Telecom spokeswoman Joanne Jalfon said the company had 900,000 fixed-line customers.

"We are watching naked broadband with interest but we're more focused on mobile, fixed, broadband and fibre at present. Naked broadband is also not so relevant in a fibre world."

Minogue said it would be a very long time before no one had a landline.

Baguley said reasons cited for maintaining a landline included alarm monitoring, safety, health monitoring and Sky TV.