ansformed from a large number of small, local operations into five large, national carriers who compete actively among themselves and with traditional wire-based carriers for customers. 21 The Rapid Growth of Wireless Telecommunications The Relative Prices of Wireless and Wireline Service In the United States, local residential service is offered at a regulated flat rate that does not vary with the number of calls or minutes of use in a local calling area. Wireless services do not offer free calling except in off-peak hours. Wireless connections have become enormously popular in part because of the substantial real decline in average wireless rates, shown in figure 7-1. Between 1996 and 2002, real cellular prices per minute de- clined at an annual rate of 23 percent, and these prices now include local and national calling because all national wireless carriers currently offer a single plan for local and national calls. 22 By contrast, real revenue per minute for interstate long-distance services that are dialed over traditional wire-based networks fell by only 9.5 percent a year between 1996 and 2002, despite a 25 percent annual decline in real switched access charges. The real consumer price index (CPI) for resi- dential landline long-distance calls, including intrastate long distance, fell by only 7.2 percent a year between December 1997 and December 2003. 24 Finally, the cost of subscribing to a local line has actually increased since 1996, largely because of a regulatory shift in the burden of non-traffic- sensitive costs from per minute long-distance access charges to fixed per line charges. In real terms, this increase has amounted to about 0.3 percent a year. 25 Clearly, the cost of using a wireless telephone has declined rapidly in comparison with the cost of leasing a local landline and using it. Local calls are still free to most local residential wireline telephone subscribers, but the cost of subscribing to the line is rising slowly. By contrast, the real cost of sending (and receiving) local and long