Trends in telecommunications prices - January 2022

Executive Summary

Prices increased by 1.4% in January 2022

In January 2022, telecommunications prices in Portugal, measured through the respective sub-index of the Consumer Price Index (CPI), rose by 1.4% compared to December 2021, following an increase in the prices of some offers of mobile services and bundles.

Compared to January 2021, prices increased by 2.7% (0.7 percentage points lower than CPI growth over the same period)¹.

The average variation rate of telecommunications prices over the last twelve months in Portugal was 0.8% (0.7 percentage points below the change in CPI (1.5%) over the same period).

Average change over the last 12 months in Portugal was 0.2 percentage points higher than the EU

In January 2022, the average rate of change in telecommunications prices in Portugal was higher than in the European Union (+0.2 percentage points). The average rate of change over the last twelve months of telecommunications prices in Portugal was the 12th highest (18th lowest) among EU countries. The country with the biggest price increase was Slovakia (+6.6%) while the biggest decrease occurred in Bulgaria (-3.9%). On average, EU telecommunications prices rose by 0.6%.

Prices have increased by 9.7% since the end of 2010

From a long-term perspective and in accumulated terms, telecommunications prices have increased by 11.3% since the end of 2010, while CPI has increased by 12.6%. Divergence between the two indexes, first seen in 2015 and increasing in 2016, is associated with “price adjustments” applied by the principal 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 maximum price on intra-EU international calls and SMS messages.

If it was not for the price reduction in intra-EU calls, it is estimated that telecommunications prices would have increased by 14.9% since the end of 2010 (2.4 percentage points above the variation in CPI over this period, in accumulated terms).

Since the end of 2009, prices have increased by 9.3% in Portugal and fallen by 9.8% in the EU

Between the end of 2009 and January 2022, telecommunications prices in Portugal increased by 9.3%, while decreasing by 9.8% in the EU. The difference narrowed with the entry into force of new European rules on 15 May 2019 regulating the prices of intra-EU communications.

A finer comparative analysis shows that, between the end of 2009 and January 2022, telecommunications prices fell by 12.2% in Croatia while increasing 2.0% in Slovenia, 4.8% in Cyprus and 9.3% in Portugal.

NOWO has the lowest monthly charge for eight offers

The lowest monthly charges are offered by NOWO in eight cases out of a total of 13 services/offers; MEO and Vodafone reported the lowest monthly charges for two types of services/offers each. NOS reported the lowest monthly fees for one type of service/offer.

In year-on-year terms, there were 21 price increases and 5 decreases. The following price variations stand out:

• The minimum monthly charge for STV increased by 30.8% with the discontinuation of an offer from NOS;
• The minimum monthly charge for Fixed Broadband (FBB) fell by 4.2%, due to NOWO's offer waiving the first monthly charge for its 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 five euros;
• 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+STV (+11.1%), STV+FTS and 3P (+0.4%) offers increased following discontinuation of the TV option from NOWO at 2.5 euros/month. Additionally, the minimum monthly charge for STV+FTS increased by 77.6% with the discontinuation of an offer from NOS, making a total of 78.4%;
• 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 five euros, and 1.3% due to discontinuation of NOWO's TV option at 2.5 euros, making a total of 9.8%;
• The minimum monthly charge for 5P offers increased by 4.3%, as Vodafone discontinued its offer of a free first monthly charge of the basic service.

MEO increased the minimum monthly charge for five services/offers and reduced the monthly charge for two offers (discount of five euros for 12 months for 4P offers supported over ADSL or satellite network). NOS increased the minimum monthly fees for five services/offers and decreased the monthly fee for one offer (mobile telephone service with mobile phone Internet - Mundo offer). Vodafone increased the minimum monthly charge for three services/offers and reduced the monthly charge for one offer, the mobile broadband Internet offer via PC/tablet. In turn, NOWO increased 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.