Telecommunications bucks inflation trend

Oct 18, 2021

Statistics NZ reports the consumer price index has risen 2.2 percent in the September quarter, making it the biggest jump since 2010, putting the annual inflation rate at 4.9 percent compared with last September’s quarter.

Yet telecommunication costs continue to track downward (2.6 percent down for equipment, 0.9 percent for services), a trend which has continued for several years now.

“If we look back to the September quarter last year, telecommunication services have fallen in price by 4.0 percent, at a time when just about every other metric continues to rise,” says TCF CEO, Paul Brislen.

“Over the past decade we have seen prices for telecommunications equipment fall by more than 18 percent and services fall by 10 percent, at a time when the prices of almost every other category measured by Statistics NZ have risen.”

Figure 1: Price changes over the past decade

Brislen says at the same time, investment in the telecommunications sector remains strong, according to the Commerce Commission.

“Investment runs to around $1.6 billion each year across mobile, fixed line and fixed wireless markets and the number of customers continues to grow, with more than 6.2 million mobile connections and 1.76 million fixed broadband connections in New Zealand.”

During the recent COVID outbreak and subsequent lockdown, usage data skyrocketed again as customers realise just how essential telecommunication services have become.

“Being able to keep the economy afloat during lockdown is vitally important, but so too is enabling classrooms to operate online, keeping family and friends connected  and providing an essential lifeline for those who need help and support. Ensuring we keep costs down for customers helps all New Zealanders stay in touch during these difficult times. ”

For media enquiries contact
Paul Brislen.

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