Cord Cutting Craze
Wireless/cellular only homes, which grew by 20% in 2008, now account for 18% of all U.S. households.  One-third of the wireless-only households have never had a landline, while the remaining two-thirds are cord cutters. Not surprisingly, cord-cutter households tend to be younger and are more likely to rent/lease their home.  Expect the wireless-only trend to grow, as homes continue to drop their landlines and young adults start new households with wireless phone service only.

Smartphone Surge
Both the Blackberry and the iPhone saw tremendous growth this year, reaching penetration rates of 6% and 2%, respectively.  The two wireless devices have attracted very different customers, however.  While the Blackberry appeals to a somewhat older, suburban consumer looking for a proven technology, the iPhone attracts a younger, urban consumer looking for the newest technology.

Mobile Media Malaise
Growth of cellular phones with streaming video or MP3 music players slowed in 2008, with penetration levels similar to those seen last year.  Among current owners, use of advanced services, such as streaming video and audio, decreased this year – a potential red flag.

Fiber Optic Future
Fiber optic TV grew at a measured pace, with penetration up 50% this year — from 2% in 2007 to 3% in 2008.  By comparison, cable and satellite usage was flat over the last year.  Look for dramatic future growth, with fiber optic TV penetration hitting 10% within the next two years and attracting an exceptionally affluent customer base.

Nielsen’s tip for telecom marketers: stress the value of your products.  Consumers will continue to seek out the latest “bells and whistles,” but they’ll be weighing the costs and the benefits more carefully than ever.

View Nielsen Claritas’s complete report.

Seventeen percent of U.S. households — 20 million homes — have already ditched their home landlines, relying instead on mobile phones, Nielsen reported.

These “wireless substitutors” tend to live in smaller households with just one or two residents and have lower income-levels — 59% have household incomes of $40,000 or less.  A significant number moved (31%) or changed jobs (22%) just before discontinuing their landline service.

“In a tightening economy every dollar counts, and consumers are more and more comfortable with the idea of ditching their landline connection,” Alison LeBreton, vice president of client services, Nielsen Mobile, noted.

The percentage of wireless-only households has grown steadily since 2003, when just 4.2% of U.S. homes had cut their landline service.

Still, Nielsen’s research shows that wireless substitution doesn’t work for everyone.  Ten percent of current landline users experimented with cord-cutting at one point, but eventually reinstated landline service.

View the full press release.

Read the white paper, “Call My Cell: Wireless Substitution in the United States.”

Explore coverage of Nielsen’s findings in The New York Times, the Los Angeles Times, Adweek, MediaPost, Wireless Week, and on CNET.com.