Definition

fixed-mobile substitution (FMS)

Fixed-mobile substitution (FMS) is the tendency for consumers and businesses to increasingly substitute cellular telephones for hard-wired or cordless landline sets.

Consumers prefer mobile phones for several reasons. The most often mentioned factors are convenience and portability. With cellular service, it is not necessary for the user to locate and remain bound to a hard-wired phone set or stay within the limited range of a cordless base unit. Most cell phone service providers offer packages in which there is no extra charge for roaming or long-distance calling. Another factor in the acceleration of FMS is the fact that as cellular telephone repeaters have proliferated, the per-minute cost of the services has been declining while coverage has been improving.

Fixed-mobile substitution at the consumer and enterprise level translates to the industry as a whole, offering a major opportunity to mobile companies and threatening the continued existence of traditional telecommunications companies should they fail to adapt. A number of companies are offering or developing devices that can connect to both traditional and wireless telecom networks as a means of slowing the overall trend to FMS.

See also: fixed-mobile convergence

This was last updated in November 2010
Posted by: Margaret Rouse

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