Cell Phone Use Affects Universities' Revenue

The Federal Communications Commission estimates that 61 percent of all 18- to 24-year-olds carry cell phones.

With an increasing amount of students relying on cell phones, many universities are worried that their own telephone services are being replaced. Many of these universities believe that it is only a matter of time before they have to compensate by raising student costs.

UNC charges students who live in residence halls 8 cents a minute for long-distance service. The revenue from long-distance use helps fund other telecommunication programs, such as the high-speed Internet access offered in in the residence halls.

A growing number of students are switching from their traditional land-based phone services to cell phone services for three main reasons -- convenience, fixed costs, and security.

Zoe Bell, a junior journalism major, said she has used her cell phone as a substitute for the University's service for the past two years and intends to continue to do so. "I have a cell phone because it allows me to easily get a hold of people and for people to easily get a hold of me," Bell said. "It's convenient for the college lifestyle."

Cyrous Ardalan, a senior biology major, said he uses his cell phone in place of long-distance services and in case of emergencies.

"I like that my cell phone offers me a cheaper and more manageable fixed cost for long-distance service," said Ardalan. "They're also helpful during emergencies, when other phones are not available."

This growing desire by students for convenience, more manageable costs and security means that the University might need to alter its approach to the telecommunications market.

Steve Harward, director of the telecommunications department, said he is aware of the shift towards cellular phone use in the telecommunications market but believes it has yet to have a drastic impact on revenue.

"As of now we have not noticed any significant loss in revenue," said Harward. "We are, however, keeping our options open and devising plans to work with the changing times."

One way the telecommunications department plans to combat the increased use of cell phones among college students is by broadening the telecommunications services the University offers.

UNC has established a discount wireless service with Cingular Wireless, a national cellular service provider. In addition to providing students with a cheaper rate, this plan allows the University to gain some revenue from the cellular market.

The telecommunications department also intends to develop more calling card plans in order to compete with student calling card use, which also drains revenue from UNC's services.

Harward said he believes that many students have misconceptions about the cost of long-distance service. "Long-distance carriers advertise low rates but fail to mention the high regulatory costs which are added to your bill," he said. "We offer a fixed 8 cents a minute which already includes all the regulatory costs."

Tom Horne, director of financial services for Academic Technology & Networks, said it is difficult to know how much cell phone use has caused revenues to decrease.

"There are a number of factors contributing to loss in revenues, and therefore it is hard to tell cell phones' effect," said Horne. "I do think they are the most prominent reason for the decrease in long-distance revenues."

The loss of revenue occurring due to the increase in student cellular phone usage is not yet considered significant, and therefore there are no plans to increase student costs.

Harward said, "We have not incurred significant damages from cell phones, so we do not plan on increased student costs."

The University Editor can be reached at udesk@unc.edu.