landline phone extinctionIf AT&T (T) has its way, your traditional landline phone (assuming you still have one) might be going the way of the dodo bird.

On a recent conference call to investors, Chairman and CEO Randall Stephenson said, "We plan to begin an aggressive transition away from legacy TDM technology."

Here's what that means in plain English: TDM is short for "time division multiplexing," the venerable phone technology we all grew up with. TDM carries calls over traditional copper phone lines that are physically switched in a public branch exchange, or PBX -- those enormous banks of analog circuits that a technician could literally step up to and repair. PBXs were the next leap in telephony technology after the age of the live operator, who connected your call by hand on a switchboard a la Lily Tomlin as the snorting, condescending telephone operator Ernestine on "Laugh In."

The next big leap in telephone technology emerged around 2004: VoIP, short for "Voice over Internet Protocol." Digital VoIP calls are made over Internet service lines, typically fiber-optic ones, which completely bypass the old copper-wire TDM/PBX system.

It was a giant leap forward, but VoIP didn't quite deliver as expected.

One advantage of VoIP over TDM was supposed to be lower cost for the system setup, but that hasn't always been the case. Another anticipated price advantage of VoIP was supposed to be that you didn't need a dedicated technician on site servicing your lines; everything would be managed over the Internet. But in practice it was discovered that such costs needs to be weighed against the fact that, with VoIP, if the power goes out, most likely so will phone service.

Which brings us to one of the primary concerns about the end of TDM.

They Don't Make 'Em Like They Used To

The old, analog phones will typically work in a power outage, because they have their own power source. Did you ever notice there's no separate power cord with an old TDM phone? You simply plug it into the jack on the wall and you're connected: Power and voice service come through the same line.

This is important if, say, you're in the middle of a hurricane and the electricity cuts out.

One of the editors here at DailyFinance recounted her own similar story. As Hurricane Sandy was barreling up the Eastern Seaboard, her old, corded, landline phone (which she otherwise kept in a closet) was the only telephone service she had. Smart thinking of her to have kept it. VoIP phones also might not seamlessly connect to 911, nor offer directory assistance.

Resistance Is Futile

So why not keep TDM around and let customers choose what they want, or even just keep a TDM line as a backup service, like our aforementioned, highly resourceful editor does? As is usually the answer in these cases: money.

AT&T doesn't want to deal with TDM service anymore because it's a dying technology, one that doesn't bring in the revenue. Many consumers are already getting voice service from cable companies, and a third of people in the country already use a cellphone for voice.

In AT&T's third-quarter earnings report, the company announced it will invest $14 billion in wireless and wireline IP broadband networks, where, including managed IT services, the company expects 90% of its future revenue to come from. There's no mention of investment in TDM.

In fact, just this past September, the telecom giant petitioned the Federal Communications Commission to make each state set a final date to terminate landline services so that carriers like AT&T and Verizon (VZ) no longer have to maintain their old TDM networks.

How May I Place Your Call?

So where does this leave the average American, who might need coverage in a bad storm when their cellphones or digital VoIP phones are out? Or what about folks out in rural areas who still depend entirely on analog phones for their voice communications?

In Kurt Vonnegut's Slaughterhouse-Five the book's narrator tells a movie maker that he is writing an anti-war book. The movie maker laughs and asks, "Why don't you write an anti-glacier book instead?" The same could be asked of people resisting the end of the legacy TDM phone system. VoIP and its digital, electrical-grid-dependent brethren are coming, whether we like it or not.

Of course, if we miss our TDM phones and PBX system, there's always YouTube, where we can stream old "Laugh In" episodes and watch Ernestine sneering at her next unfortunate victim. Unless, of course, the power's out.

John Grgurich is a regular contributor to The Motley Fool. Follow John's dispatches from the bleeding edge of capitalism on Twitter @TMFGrgurich.

Increase your money and finance knowledge from home

Introduction to Preferred Shares

Learn the difference between preferred and common shares.

View Course »

Basics Of The Stock Market

Stock Market 101 - everything you need to know but were afraid to ask!

View Course »

Add a Comment

*0 / 3000 Character Maximum


Filter by:

Most of the Baby Bells are allowing their copper networks to deteriorate.There is minimal or no upkeep of these networks. They want to get out of the landline business and are lobbying state legislators to let them out of their obligation to provide service. Pretty soon Mom and Pop or Grandma and Grandpa who don't live within sight of a cell tower and are serviced by a failing,deteriorating copper network are going to be S*** Out Of Luck!!!!!Contact your State legislators and don't let the Baby Bell's lobbyists slide this under the radar. It will happen and we won't know about it until after it's happened. It will be a very quiet operation with barely a ripple. Then we will be stuck with this decision. Verizon Communications is whittling down the number of their outside techs quickly .

November 28 2012 at 1:35 AM Report abuse rate up rate down Reply

For VOIP you don't just need power at the source you must also have power at the end user. If the telephone central offices were also under water during Hurricane Sandy you're still out of luck. Cell service is not the complete answer.Your cell phone may work off of a tower, but that cell tower is still physically connected to a fiber optic cable or copper cable that leads back to a central office where the call is routed to whomever you called. Old technology with a corded landline has been around for over 100 years. When all the newer types of communications fail, you can still rely on POTS(Plain Old Telephone Service). All you old telephone men and women know what I'm talking about.

November 28 2012 at 12:55 AM Report abuse rate up rate down Reply

The author is misinformed !
During a local power outage such as a storm or hurricane the locally powered neighborhood TDM concentrators go dead -after about 4 hours when the backup batteries deplete.
The only phone that works then is a old full copper pair telephone service powered by the Telephone Centtral Office
Very Rare if not gone completely in most areas.

November 19 2012 at 8:37 AM Report abuse rate up rate down Reply

We kept our landline in case a storm knocks out the cell tower.

November 17 2012 at 8:03 PM Report abuse rate up rate down Reply
1 reply to freethedems2012's comment

Also, never give out your credit card number over a cell phone. They aren't secure.

November 17 2012 at 8:03 PM Report abuse rate up rate down Reply

Well, if VoIP or cellular technology were worth a crap, I would have already switched. You can't use VoIP for conference calls without siginificant interference, and connections over cell phones are prone to drop easily and have notoriously poor reception. Guess what? TDM has NO interference and is virtually 100% reliable in that there are no dropped calls and the reception is fantastic (particularly on corded phones). That's why most busiensses have not switched. Analog phones of the 1980s had superior call quality compared to the crap we settle for today on cell phones. I can barely hear people on my cell (Verison) with all the background noise. Try driving between skyscrapers or large trucks or in a tunnel: Dropped call. The fact that most of America settles for this poor service shows that people have no interest in quality over convenience.

November 14 2012 at 10:19 AM Report abuse +2 rate up rate down Reply
2 replies to JDCochran's comment


Try driving through a tunnel tethered to a landline and see how that works out for ya!

By the way, VoIP support High Definition Voice, a capability unavailable from TDM.

November 14 2012 at 10:32 AM Report abuse rate up rate down Reply
5 replies to t_trevor2's comment

someonedumb, tell us once more about how you just can't comprehend.

It's always a show stopper!

November 14 2012 at 1:24 PM Report abuse -1 rate up rate down Reply

AT&T is living up to its name; Awful, Terrible and Too expensive!!!!

November 14 2012 at 9:45 AM Report abuse +1 rate up rate down Reply
1 reply to David's comment

Keep in mind that during the same conference call with investors that AT&T announced its more aggressive move away from legacy TDM technology, it also announced significant increases in it's capital investment budget to a whopping $22 billion/year for each of the next 3 years.

Consumers are driving an explosion in demand for ubiquitous wireless broadband, creating immense pressure on network resources that demand these massive investments. At the same time, carrier business models are being pressured by increased adoption of Over-The-Top voice, video, and messaging (think Skype, for example) that cannibalize AT&T's traditional source of revenue.

If you think building a next-generation communications network is easy, you should set up shop and show AT&T how it is done!

November 14 2012 at 10:49 AM Report abuse rate up rate down Reply

well there goes the last of the telephone lines. better buy a CB and keep it for emergencies

November 14 2012 at 9:31 AM Report abuse +1 rate up rate down Reply
1 reply to street163's comment

What's next to disappear!

The horse and buggy?

November 14 2012 at 10:15 AM Report abuse rate up rate down Reply

Trevor, you try to make it look like you know what you are talking about, but you don't. The LEC's got the public utility commisions to approve rate cap policies allowiing the LEC''s to charge the rate payers so they could implement digital techmology into their networks, even though they should have been upgrading their networks in the original rates. They illegally subsidised the growth in their cellelar networks using the money from the land line users. They also got the government to approve a charge to cover broadband growth in rural areas. The funny thing about this is that the investments in the TDM arena are already payed for. The large Class 5 CO's have been paid for 5 times over, and they still overcharge for a landline. There is an alterior motive though. They can dump their old high cost employees if they phase out landlines as we know it. Dump the technicians, pocket the money, use lower cost new employees who are actually working on the same infrastructure . DSL over Copper is growing, and they pay those techs quite a bit less. Read betwwen the lines, landlines won't disappear, just how they are delivered.

November 14 2012 at 8:41 AM Report abuse +1 rate up rate down Reply
4 replies to telepole's comment

I use a cell phone almost exclusively now (mostly for text), but I still have my landline as a backup and as a deadend for telemarketing calls. I turned off the ringer and let the answering machine take whatever calls still come to my landline. That's about all it's good for now, but in the back of my mind, I know there's always the possibility that something will happen and the cell won't work. So I hang on to my landline until Big Bro finally decides to pull the plug.

November 14 2012 at 7:50 AM Report abuse +2 rate up rate down Reply
mike edwards

during storms sometimes land lines are better or vise versa we need both to me cell phones are for people on the run its akmost impossible to contact a cell phone if they dont want too like bill collectors

November 14 2012 at 7:34 AM Report abuse +1 rate up rate down Reply