Trends in telecommunications prices - February 2022

Executive Summary

Prices decreased by 0.3% in February 2022

In February 2022, telecommunication prices, as measured by the respective sub-index of the Consumer Price Index (CPI), decreased by 0.3% from the previous month due to price changes in some bundled offers.

Compared to the same month last year, prices rose by 1.5%, which is 2.7 percentage points (p.p.) lower than the CPI growth¹.

The average rate of change in telecommunication prices over the last twelve months was 0.9%, which means 0.9 percentage points (p.p.) lower than that recorded by the CPI (1.8%).

Average change over the last 12 months in Portugal was 0.3 p.p. higher than the EU

In February 2022, the average rate of change in telecommunications prices in Portugal was higher than in the European Union (+0.3 p.p.). The average rate of change over the last twelve months in telecommunications prices in Portugal was the 10th highest (18th lowest) among EU countries. The country with the highest price increase was Slovakia (+5.9%) while the highest decrease was Bulgaria (-4.5%). On average, EU telecommunications prices increased by 0.6%.

Prices have increased by 10.9% since the end of 2010

From a long-term perspective and in accumulated terms, telecommunications prices have increased by 10.9% since the end of 2010, while CPI has increased by 13.0%. The divergence between the two indexes, first seen in 2015 and increasing in 2016, is associated with “price adjustments” applied by main providers. As of May 2019, the narrowing divergence between the two indexes was mainly due to the entry into force of Regulation (EU) 2018/1971 of the European Parliament and of the Council, which imposed a price cap on intra-EU international calls and SMS messages.

Had the price reduction of intra-EU calls not occurred, it is estimated that telecommunication prices would have grown by 14.6% since the end of 2010, being in cumulative terms 1.6 p.p. above the CPI change in this period.

Since the end of 2009, prices have increased by 8.9% in Portugal and decreased by 9.6% in the EU

Between the end of 2009 and February 2022, telecommunications prices in Portugal increased by 8.9%, while decreasing by 9.6% in the EU. The difference narrowed with the entry into force, on 15 May 2019, of new European rules regulating the prices of intra-EU communications.

A more detailed comparative analysis shows that between the end of 2009 and February 2022, telecoms prices fell by 21.9% in France, 17.1% in Italy and 9.1% in Spain, while in Portugal they rose by 8.9%.

NOWO has the lowest monthly charge for eight offers

The lowest monthly charges are offered by NOWO in eight cases from a range of 13 services/offers, while MEO and NOS presented the lowest monthly charges for two types of service/offer each. Vodafone presented the lowest monthly charges for one type of service/offer.

On a year-on-year basis, there were 18 price increases and 4 price decreases. The following price changes stand out:

• The minimum monthly charge for PTV increased by 30.8% with the discontinuation of an offer from NOS;
• The minimum monthly charge for FBB fell by 4.2%, due to the offer of the first monthly charge of NOWO’s basic service;
• The minimum monthly charge of the Mobile Telephone Service with Internet increased by 50.0%, due to discontinuation of the offers from NOWO and MEO (Uzo offer) with a monthly charge of EUR 5.00;
• The minimum monthly charge for Mobile Broadband via PC/Tablet increased by 4.3%, as MEO discontinued its offer of a free first monthly charge of the basic service;
• The minimum monthly charges for FBB+PTV (+11.1%), PTV+FTS and 3P (+0.4%) offers increased following discontinuation of NOWO’s TV option at EUR 2.50/month. Additionally, the minimum monthly charge for PTV+FTS increased by 77.6% with the discontinuation of an offer from NOS, making a total of 78.4%;
• The minimum monthly charge for 4P offers increased by 8.3% due to discontinuation of NOWO’s mobile telephone service option with a monthly charge of EUR 5.00, and 1.3% due to discontinuation of NOWO’s TV option at EUR 2.50, making a total of 9.8%;
• The minimum monthly charge for 5P offers increased by 0.2%, as Vodafone discontinued its offer of a free first monthly charge of the basic service.

According to provider, MEO increased the monthly charge for five services/offers and reduced the monthly charge for two offers (discount of EUR 5.00 for 12 months for 4P offers supported over ADSL or satellite network). NOS increased the minimum monthly charges for two services/offers. Vodafone increased the minimum monthly charges for three services/offers and reduced the monthly charge for one offer (the mobile broadband Internet offer via PC/tablet). In turn, NOWO increased the minimum monthly charges for eight services/offers and reduced the monthly charge for one service/offer (offer of the first monthly charge for the single-play fixed broadband basic service).

There were notable increases in the monthly charges for 4P and 5P offers by MEO, NOS and Vodafone in May and June 2021².