There was a recent article in the Wall Street Journal that noted that the business world still uses a lot of landline telephones. Landline telephones have been steadily disappearing from homes, but are still not gone. I see ISPs still selling a telephone line to 10% or more of passings, and surveys show that the average residential landline penetration rate is still somewhere between 15% and 20%.

Some homes keep landlines because of poor or no cellular coverage. Even in areas where outdoor cellular coverage is good enough to make calls, indoor coverage might be poor. For most homes, indoor cellular coverage is typically half as good as the coverage just outside the home. While homes with broadband can use WiFi for making phone calls, those with erratic or unreliable broadband might keep a landline to be certain of having a connection to 911. Many older people keep a landline because they are more comfortable talking on a handset.

The WSJ article points out that a lot of businesses still have landlines. Some businesses, like hotels, don’t have a choice and are legally required to provide a landline in every room for guests to be able to call 911. Hotel guests also like the feature of using the landline to easily connect to the front desk or room service. It doesn’t seem likely that hotels will stop using landlines in the foreseeable future. Many hospitals keep landlines for similar reasons.

Other businesses keep landlines for a variety of reasons. One of the biggest reasons is the ease of using landlines for abbreviated dialing to reach extension numbers within a business. It’s also a lot easier for employees to use a business landline for functions like putting calls on hold, transferring calls, or bridging multiple employees into a call.

Employees of large businesses favor landlines instead of business cellphones since a landline allows them to walk away from taking work calls after the end of the workday. Many businesses prefer landlines for a similar reason since they can create a clear differentiation between business calls and personal calls. There are also some security concerns. A lost or stolen company cellphone can give access to company systems and records.

The WSJ article points out that some large businesses are slowly weaning themselves from landlines. They quote the CTO of New York Life, who says that every employee still has a landline at their desk today, but may not within a year. He notes that the transition to company cellphones won’t be easy since it means a lot of reeducation of employees on how to perform routine business phone functions on a smartphone—something that isn’t always as easy or intuitive to use as the buttons on business desk phones.

I’ve had many ISP clients consider ditching the telephone business completely, and a few have done so. But many have decided to keep the telephone option because of business customers. It’s a lot harder to sell broadband to a business if it doesn’t also come bundled with telephone service. Many businesses have learned the painful lesson over the years of having different voice and data providers, which can turn into finger-pointing when something goes wrong with the voice connection.

The landline business also still has an attractive margin for companies that buy voice switching on a bulk wholesale basis. ISPs that ditch voice have made the ultimate transition to be a dumb pipe provider—something many of them have been leery of for many years.