Inflation skyrockets, but phone rates go down.

20 April, 2022

This is because while the inflation registered so far this year does not stop increasing, reaching the CPI of 9.8% compared to the previous year, the telephone packages fell by 1%.

Inflation skyrockets, but phone rates go down.

The reason: customer loyalty.

Large telecom operators have been immersed in a price war for some time now. The main reason is to avoid the loss of customers, prioritizing to keep the existing customer portfolio given the lack of new ones. However, according to the data collected, they do not seem to have found the formula to avoid such a loss.

Those lost customers usually go to ‘low-cost’ operators, which, given the situation, have experienced notable growth in recent years.

New and lost lines by operators.

Data from February of this year:

Operator and lost lines

  • Movistar 33.051 lines
  • Vodafone 29.779 lines
  • Orange 19.689 lines

Operator and new lines

  • MásMóvil 22.467 lines
  • Virtual operators (MVNO) 60.052 lines.

Lower rates.

The last offers launched by Movistar, Orange and Vodafone have not influenced the inflation of telephone services, since they have reduced the prices of the rates by almost 1% in the last twelve months. In contrast, the CPI approaches a two-digit number.

For example, Vodafone, one of the most aggressive operators with regard to its offers, currently offers a 50% discount on some of its rates; Orange has a 25% discount on some of theirs, and Movistar offers discounts up to 27%.

Troubled waters… Mergers at sight.

As mentioned above, large telecom operators have been immersed in a price war for some time now, probably for the same time that rumours or negotiations of potential mergers between operators have been coming to the fore, perhaps the solution to their problems.

You see one, you have seen them all. And that is that in the merger dance, the couple made up of Orange and MásMóvil has recently confirmed to be negotiating to join forces.

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