US consumer expenditures on telephone services

This item has gotten a lot of press in the blogosphere. It represents what we have all been experiencing. If you look at the raw data, adjusting for inflation, the total expenditures on telecom have remained steady. There has been a substitution effect, though, where expenditures on mobile telephony has increased to 0.9% of income from 0.4%, while expenditures on landline telephones have decreased to 0.9% of income from 1.5%.

If these trends continue, we can expect expenditures for mobile phones to exceed landline phones in the US this year (2007).