Trends in telecommunications prices - February 2021

Executive summary

• In February 2021, telecommunications prices, measured by the sub-index of the Consumer Price Index (CPI), increased by 0.8% compared to the previous month. This change was due to the price increase of some quadruple-play bundles.
• Compared to the same month of the previous year, the observed variation in prices was -0.4%. The year-on-year variation of telecommunications prices has been lower than the growth of the CPI since November 2017.
• The average variation rate of telecommunications prices in the last twelve months was -1.5%, i.e., 1.5 percentage points (p.p.) below that recorded by the CPI (0.0%). This price reduction reflects the entry into force on 15 May 2019 of the new European rules regulating the prices of intra-EU communications, and the reduction of the monthly charge of some post-paid mobile broadband offers via PC/Tablet and some bundled offers.
• In February 2021, the average variation rate of telecommunications prices in Portugal was lower than that observed in the European Union (-1.5 p.p.). The average variation rate of telecommunications prices of the last twelve months in Portugal was the 8th lowest (20th highest) among EU countries. The country that recorded the highest increase of prices was Poland (+4.7%) while the strongest reduction occurred in Denmark (-3.3%). On average, telecommunications prices in the EU decreased by 0.1%.
• Between the end of 2009 and February, telecommunications prices in Portugal increased by 7.3%, while in EU they fell by 9.8%. The difference narrowed following the entry into force on 15 May 2019 of the new European rules regulating the prices of intra-EU communications.
  A finer comparative analysis with some countries with a GDP per capita similar to that of Portugal, shows that telecommunications prices increased by 7.5% in Slovakia, 7.3% in Portugal and 1.0% in Greece, while in the Czech Republic they fell by 22.7% between the end of 2009 and February 2021.
• Minimum monthly charges are offered by NOWO in seven cases of a range of 13 services/offers, while the providers MEO, NOS and Vodafone each present the lowest monthly charges for two types of services/offers.
• Compared to the same month of the previous year, there were 19 price variations of the minimum monthly charges of services/offers, 16 of which were price increases and 3 were reductions.
• The following price variations stand out in particular: the minimum monthly charge of the mobile telephone service with internet on the mobile phone fell by 33.3%, thanks to the reduction of the monthly charge of the NOWO offer from 7.5 euros to 5 euros (with free offer of the first monthly charge); and the minimum monthly charge of individualised fixed broadband (BLF) increased by 4.3%, due to the end of the free offer of the first monthly charge of the basic service provided by NOWO.
• By provider, MEO decreased its minimum monthly charge of one service/offer in relation to the same month of the previous year and increased the monthly charge in four services/offers. One of the MEO services whose monthly charge decreased significantly was the offer of mobile telephone service with internet on the mobile telephone (UZO offer), which now has values close to the minimum monthly charge (provided by NOWO). NOS increased the minimum monthly charges of seven services/offers, and Vodafone increased the minimum monthly charges of four services/offers. Particular note should be made of the increased monthly charge of the triple-play offer of MEO, NOS and Vodafone, which occurred in October and November of 2020¹.