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For the first time, mobile phones have surpassed fixed phones as the most common devices that EU residents use to make personal calls. The latest E-Communications Household Survey commissioned by the EU shows that 80 percent of homes in the 25-state union now have access to mobile phones.

By contrast, 78 percent reported using a fixed-line phone in the home. And, as most fixed operators can attest, their share will probably continue to decline in the future.

The same development can be found in other parts of the world. In the United States, for example, 8 percent of mobile users had “cut the cord” and dumped their landline phones by the end of 2005  according to a Forrester Research report published in March. That was up from 5 percent a year earlier.

So what should an operator do to either stem the customer flight or – in the case of a mobile services provider – speed up the process?

Experts offer some basic advice for both: develop a clear strategy for managing new customer preferences.

“Fixed operators are becoming smarter,” says Mark Heath, of UK-based Analysys, who recently coauthored two reports on fixed-mobile substitution. They “are learning how to bundle services, and aggressively price broadband services to get them into the mainstream as quickly as possible.”

Broadband, Heath says, remains the more effective weapon fixed operators can use against their mobile competitors – at least until basic 3G networks evolve into Super 3G. That is because mobile broadband through basic 3G service still cannot match broadband over cable or the phone line when it comes to speed and coverage.

Some fixed-line operators are also pushing Internet Protocol Television (IPTV) to offer their customers added benefits through wireline. Deutsche Telekom, for example, recently rolled out an IP-based television service over its new high-speed VDSL network.

By the same token, mobile operators are waking up to the fact that fixed operators – by offering faster internet access and more services via broadband –could lure back some customers who went mobile, Heath says.

Some mobile operators, including O2 in the United Kingdom, have responded by teaming up with fixed partners that allow them to offer a bundle of fixed and mobile services – including high-speed internet access.

As the battle between mobile and fixed heats up, more mobile operators are also offering customers large “buckets” of minutes and attractive bundles of voice and data services at more affordable rates, Heath says.

So is it just a matter of time before fixed-line phone systems disappear for good?

Probably not, says Erik Kruse, a senior expert in consumer behavior at Ericsson’s Consumer & Enterprise Lab, which researches telecom trends and developments.

For example, families with children old enough to speak on the phone but too young to handle mobile phones will still want a fixed phone at home, he says. Kruse also believes that fixed operators that overhaul their rates could manage to retain their customers.

Flat rates, rather than charging customers by the minute, could help, Kruse says. So would more modern, racier phones with screens that show, say, Yellow Pages or a video of the person on the other end.

“The fixed phone has not really changed in the past 70 years,” he says. “There are a lot of functions adopted by the mobile industry that fixed operators could also benefit from.”