The worldwide market for cordless phones (those with portable handsets linked by radio to fixed-line base units) will show a slow but steady decline in value over the next five years.
According to new data from ABI Research, the total cordless phone market size in 2014 will be about 17% — nearly $1 billion — smaller than it is today. However new digital models with broadband-friendly functionality are providing some rearguard relief.
“The decline in the cordless phone market is indicative of a larger story,” says practice director Jason Blackwell, “which is that of wireless substitution worldwide. In developed nations a growing number of people are dropping their fixed phone lines altogether in favor of mobile-only services. (95% of all cordless phones are used in homes, not businesses.) And in many developing regions, telcos and users are jumping straight to mobile networks without ever deploying fixed-line infrastructure.”
There are high barriers to entering this market, and little scope for newcomers. However some tactics may be available to slow the decline, at least in Europe and eventually in the United States. A number of telecommunications service providers pitch voice services to cable and Internet subscribers, and they frequently sweeten the offer with a free or low-priced home phone provided by a small and dwindling band of vendors: Panasonic, Philips, Siemens Gigaset, Uniden, and Vtech. Such operator tie-ins can bolster sales beyond retail levels.
“The phones included in these deals are frequently quite high-end, offering color displays and advanced features tied to broadband connectivity and the home network,” says Blackwell. “These DECT (DECT 6.0 in North America) and CAT-iq handsets offer a bright spot to cordless phone makers weary of competing mainly on price. ISPs and other operators are also excited about the newest cordless phone models, and hope to add new revenue streams from data beyond traditional voice service.”
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