Trends in telecommunications prices - September 2022

Executive Summary

Telecommunications prices down by 0.2% in September 2022

In September 2022, telecoms prices, as measured by the respective Consumer Price Index (CPI) group, decreased by 0.2% compared to the previous month due to changes in a bundled offer.

Compared to the same month of the previous year, prices increased by 1.5%, mainly influenced by price increases implemented by MEO, NOS and Vodafone in April 2022¹. This growth in telecoms prices was 7.7 percentage points (p.p.) lower than that recorded by the CPI (9.3%), the largest negative difference since March 2001.

The average rate of change in telecommunications prices over the last twelve months was 1.8%, i.e. 4.1 p.p. below that recorded by the CPI (6.0%).

On a per sub-group basis, according to Eurostat, the average rates of change over the last twelve months were 3.7% and 0.2% for bundled services and mobile telephone services, respectively. In the case of bundled services, the rate was 2.7 p.p. higher than in 2021.

Average change over the last twelve months in Portugal was 1.4 p.p. higher than in the EU

In September 2022, the average rate of change over the last twelve months in telecommunications prices in Portugal was higher than that of the European Union (+1.4 p.p.). Portugal recorded the 6th highest price change (22nd lowest) among EU countries. The country with the highest price increase was Poland (+4.8%) while the highest decrease was Slovenia (-4.7%). On average, telecoms prices in the EU have increased by 0.4%.

On a per sub-group basis, the average rate of change over the last twelve months in the prices of bundled services and mobile telephone services in Portugal exceed the EU average by 2.4 p.p. and 0.7 p.p., respectively.

Telecoms prices have increased by 12.0% since the end of 2010

In a long-term perspective and in cumulative terms, telecoms prices grew by 12.0% since the end of 2010 while the CPI grew 21.6%. Between 2015 and 2019, the cumulative change in telecommunications prices was higher than the cumulative change in the CPI due to “price adjustments” made by main providers. In 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 maximum price for international intra-EU calls and SMS.

Without the price reduction of intra-EU calls, it is estimated that telecommunications prices would have grown 15.7% since the end of 2010, falling in cumulative terms 5.8 p.p. below the CPI change in this period.

From the end of 2021, the CPI started to grow at a faster rate than telecoms prices.

Since 2009, prices have increased by 10.0% in Portugal and decreased by 9.7% in the EU

Between the end of 2009 and September 2022, telecommunications prices increased in Portugal by 10.0%, while in the EU they have decreased by 9.7%.

A closer comparative analysis shows that between the end of 2009 and September 2022, telecoms prices fell by 21.8% in France, 17.0% in Italy, and 10.5% in Spain, while in Portugal they rose by 10.0%

NOWO has the lowest monthly fee for eight offers

The lowest monthly fees are made available by NOWO in eight cases out of a range of 13 services/offers, while MEO and Vodafone presented the lowest monthly fees for four and two types of services/offers respectively.

On a year-on-year basis, there were 3 services/offers with price increases and 4 with price decreases. The following price changes stand out:

• The PTV minimum monthly fee increased by 7.6% after NOS ended its single play PTV offers. In September 2022, the PTV minimum monthly fee corresponded to a MEO offer.
• The FBB minimum monthly fee decreased by 4.2%, due to the offer of the first monthly fee of NOWO’s basic service.
• The minimum MTS monthly fee with Internet increased by 43.8%, after MEO ended its offer (Uzo offer) with a monthly fee of 5€.

Compared to the same month of the previous year, and on a provider basis, MEO increased the monthly charge for two services/offers and reduced the monthly charge for three services/offers (increased the basic monthly charge for 4P offers supported over ADSL or satellite networks by 2€, but started to waive the first monthly fee for 4P and 5P offers). Meanwhile, NOS increased the minimum monthly fee of one service/offer compared to the same month of the previous year, while NOWO decreased the monthly fee of one service/offer (offer of the first monthly fee of the single play fixed broadband basic service).