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Jess Riegel, 17, of Granite Bay, chats on his cell phone in his room, where he also logs lots of Internet time. Communications services that once were considered luxuries are now seen as necessities.
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Sacramento Bee/Andy Alfaro
If you think talk is cheap, listen up
With new gadgets galore, a typical family can spend $200 or more a month to stay in touch.
By Deb Kollars – Bee Staff Writer
Published 2:15 am PST Sunday, March 13, 2005
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One afternoon this past week, Mike and Susan Riegel and their son, Jess, sat at the table with the latest monthly cell phone bill spread before them.
It was $132 - $40 more than expected - and the family was doing what families do in such times: Squinting at the rows of numbers, trying to figure out who had done all the talking.
The son solved the mystery:
“I went over 40 cents.”
A pause.
“Dad went over $2.50.”
Dramatic pause.
“Mo-om? You went over $37.50.”
Ah, the price of living in a communications wonderland.
Just a few years ago, a family might have spent $50 or so for telephone service each month, maybe more if they were big long-distancers. Today, with the explosion of telephone, wireless and Internet options, a household such as the Riegels’ can easily spend $200 or more a month to stay connected with each other and the world.
On the one hand, it has never been easier for people to stay in touch, thanks to e-mail, voice mail, text messaging, instant messaging, phone cards, free nights and weekends, and cell phones that work even on mountaintops.
On the other, we are paying quite a price - financially and otherwise - for all this conversation.
Between 1993 and 2003, annual household telephone and Internet costs in the United States rose from an average of $658 per year to $1,080 - a 64 percent increase, based on a review of consumer expenditure patterns logged by the federal Bureau of Labor Statistics.
By comparison, among other major categories tracked by the bureau during those same years, average annual household spending on food rose 21 percent, entertainment 27 percent, health care 36 percent, housing 40 percent and alcoholic beverages 46 percent. Spending on apparel dropped 2 percent.
“We’ve had an explosion of telecom items to spend money on,” said Dan Jester, an economist with Economy.com, a consulting firm based near Philadelphia. “We are definitely communicating more.”
Explosion is a good term for what has happened in the telecom industry. Ten years ago, just 6 percent of households had Internet service and 16 percent had wireless service, according to an annual national survey by the Yankee Group, a technology research firm in Boston. Last year, the survey found 66 percent of households had Internet service and 65 percent had wireless. The Yankee Group found an even higher average expenditure rate for telephone and Internet services than the Bureau of Labor Statistics: $153 a month as of 2004.
The rush to connect carries a price beyond the financial. Parents worry about their kids spending hours at the computer sending instant messages back and forth to friends - or maybe strangers. Classroom teachers compete with students more interested in camera phones than lessons. Cell phones ring in the middle of movie theaters, restaurants and even funerals.
Tori Trask, a marriage and family therapist for Kaiser Permanente’s Elk Grove medical offices, said she has seen increased family conflict over unexpectedly high bills and parental attempts to set phone and Internet limits for children.
She also worries about those who can’t bear to turn off cell phones during therapy sessions.
“Don’t get me wrong,” she said. “I think technology is wonderful. But this kind of constant connection can be addictive. I get concerned when people can’t shut off the rest of the world for an hour and focus on their own health.”
The telecom wave is reminiscent of the changes that swept the world of television, starting in the 1970s. Cable. Premium channels. Satellite. Videos. Viewed as luxuries early on, they soon became entertainment staples, said Yale M. Braunstein, a professor of information management at the University of California, Berkeley.
“Everyone wondered how people would be able to afford it,” Braunstein said. “But they kept adding channels, and people kept buying them.”
Similarly, he said, communications services once seen as optional pleasures have become necessities for many.
The Riegels are a quintessential example. The family lives in a rural corner of Granite Bay, on a generous plot of land. It has a rustic home that Mike Riegel built, a pen for goats, and studios for himself and his wife, both artists and college art instructors.
Six years ago, the Riegels had a single Pacific Bell phone line coming into their house, and four phones scattered about their home and studios. Their monthly phone bills ran high, often reaching $125. They made many long distance calls to family in the Bay Area, and also paid long-distance rates on most local calls because of their rural location.
Looking back, it was 1999 when the Riegels first dipped their toes into the telecom abyss. Their first cell phone was a heavy gray model that they shared. They paid $50 a month for the convenience.
The next year, their high school daughter, Alli, wanted to use the Web for school research. That’s when the second phone line appeared (about $12 a month more) and a dial-up Internet service (another $20 or so.)
Soon came a fax machine. A cell phone for Alli when she started driving. New cell phones for the other three and a sensible family plan. Call waiting. Caller ID. Four more portable phones. A faster wireless broadband Internet service. And most recently, phone cards to keep in touch with Alli, now 20 and studying in Italy.
Together, the bills total about $2,500 a year. At that pace, the Riegels will spend $25,000 over the next 10 years staying in touch.
To this active and creative family, it is worth it. Their $68 monthly package with AT&T for two phone lines comes with unlimited long distance, which they put to good use.
Mother and daughter e-mail every day, and have discovered the wonders of computer instant messaging. The son, an accomplished unicyclist, spends at least three hours a day on the Internet, editing unicycle movies, creating Web sites for others, and doing research for school.
And all feel safer traveling with cell phones.
“It’s so convenient, you’d be stupid not to have a cell phone,” Mike Riegel said. “I think we’re pretty average in how much we use these things.”
According to telecom experts, the per-minute price of talking actually has gone down over the years because of competition among long-distance companies, wireless firms, and most recently, providers of phone service over the Internet. In addition, consumers have seen price breaks come in the form of bundled packages of phone, wireless, Internet and cable services.
Even with the reductions, though, people often find themselves spending more over time because they opt for ever bigger “buckets” of monthly minutes and extra features such as text-messaging and phones that can take pictures and deliver e-mail.
In addition, communication costs also are going up because many are switching from dial-up Internet services to Broadband, which tends to cost more, said Su Li Walker, an associate analyst with the Yankee Group.
As people absorb the rising costs, the bills become as mundane as the electric company’s.
“I usually don’t even think about it. I just pay them every month,” said Jeannie Gandler, a mother of two living in suburban Granite Bay.
But every now and then, bills arrive that cannot be ignored. Sometimes they show up after teenagers have been text-messaging away, unwittingly running up charges in triple digits.
Two weeks ago, Gandler took a rare second look at her long distance bill from MCI, found a $212 tab from her numerous conversations with family in Montana and California, and decided something had to change.
"I thought, ‘Oh, my gosh, I could have bought a plane ticket,’ " she said. She shopped rates, found a $100-a-month plan with SureWest that offered unlimited long distance, and signed up immediately.
Gandler and her husband, Scott, still will spend about $160 a month for all their communication services. They haven’t analyzed it closely, but have a vague sense that they are saving less these days, and spending less on charity and vacations because of the creeping telecom costs.
Other families make other adjustments. Some quit subscribing to newspapers and magazines. Some do more work at home, spending less on transportation. Others deduct telecom expenses on income taxes. Still others give up land lines altogether, using wireless exclusively.
Many have been able to absorb the hit through rising incomes. According to the same Bureau of Labor Statistics survey that tracks household expenditures, average income rose 47 percent between 1993 and 2003.
“It’s a lifestyle change,” said Israel Balderas, a communications consultant in Washington, D.C. Most people, he said, don’t need to talk on the phone as much as they do. Or check e-mail every hour. But they like it. So they do.
The Riegels would be the first to agree. Now that they have those options in their lives, they are willing to pay the price for chatting.
