March 30, 2021
More for Less: The Actual Story of the Amazing Decline in U.S. Wireless Prices .
It’s never been a better time to be a mobile wireless customer in the U.S. America’s wireless carriers are locked in a fierce competitive battle to win consumers each and every day. For the past 20 years, that intense competition has benefitted hundreds of millions of consumers, who have seen falling prices and greater value.
When looking at prices and, quite frankly, any value-based investments in this life, the important thing is long-term trends. Daily, weekly, or even monthly changes in data like wireless price are fairly meaningless, more noise than signal. What’s more relevant is performance over time, and there, the true positive impact of the dynamic and competitive wireless industry in this country becomes clear.
A Track Record of Declining Prices.
For two decades, wireless prices in the U.S. have declined. That holds true regardless of what metric you use: sticker price (down 45% from 2010 to 2019); BLS data (down 40% from 2000 to 2020; or ARPU (down 21% from 2014 to 2019).
Let’s take a look at sticker price. In 2010, an unlimited data, talk and text plan cost $113.87 on average for one line. By 2019, that same plan cost $64.95. That means U.S. subscribers now save $130 billion annually in wireless plan costs.
We’ll gladly put that long-term record of price declines against other key consumer goods and services. For instance, while wireless prices declined, other goods (doctors’ services, up 64%; food, up 63%; housing, up 65%; cable and satellite TV service, up 96%) increased. Even looking at all consumer goods that BLS tracks as a whole, prices have gone up 54% over the past two decades, yet wireless prices have fallen.
In other words, wireless price trends cut against the grain of the price trends of many other goods and services that consumers depend on. Occasionally, wireless price declines were so significant, they were able to change the price trajectory for consumer goods overall. For instance, at one point in 2017, wireless prices were falling so drastically, the average price for the broader set of consumer goods fell for the first time in seven years, with wireless prices driving nearing half of that decline.
Constant Improvements in Wireless Value.
As impressive as the U.S. wireless price decline trend is, focusing just on prices actually undersells the broader value enhancements—faster speeds, larger or unlimited data packages, and more powerful mobile devices—that America’s wireless consumers receive year in and year out.
For instance, download speeds increased 31x, from 1.3 Mbits/second to 41 Mbits/second, during the 4G decade. Over that same period, annual mobile data use increased 96 times, from 388 billion megabytes of data to a whopping 37 trillion megabytes of data.
Quantifying what these improvements mean for consumers can be tricky, but we do know that just looking at just a single metric can be misleading. That’s why it was so notable that a comprehensive analysis of wireless plans—looking at factors beyond price such as amount of data included, SMS inclusion, number of lines, network coverage, download speeds, a country’s geographic size and per capita income—offered in 36 countries last year found that America’s wireless customers get the most value for their money.
The wireless industry enables these massive improvements to consumers’ wireless experience through investment. In just the past four years, wireless companies have invested over $100 billion building out the infrastructure to power the 5G Economy, with billions more invested in the spectrum resources that power wireless connectivity.
These investment in our country’s future are driven by intense wireless competition: 99 percent of Americans can choose between three or more wireless providers from among national operators, over 100 regional operators, including resellers and cable companies.
A Wireless Marketplace Driven by Consumers’ Ever-Evolving Preferences
This is always the case to some degree, but in the past year, consumers drove an unprecedented surge in mobile voice and data traffic amounts as well as patterns. For instance, mobile hotspot use soared. One provider found consumers were using their mobile devices’ hotspot ability nearly 40% more than average so they could share that mobile data connection with other devices.
The competitive wireless marketplace quickly adjusted to meet consumers’ evolving needs. Service providers looking to win over consumers looking for new offers that reflect their changing needs is a good thing. And it’s reflective of how America’s wireless industry stepped up in big ways to meet the challenges of the past year and keep people connected despite massive shifts and spikes in their connectivity needs.
Similarly, over the past year or so, wireless providers have been hard at work building new 5G networks across the country. In a deeply competitive industry, you’d expect to see evolving marketplace offerings—and that’s exactly what’s been happening here. Consumers are seeing offers for new wireless plans, with larger data packages, adjusting existing plans, offering more value-increasing additions like streaming subscriptions and 4K video, and bringing powerful new 4G and 5G devices to market.
* * *
America’s wireless industry has been providing more for less for the past 20 years. More data, new devices, and faster speeds all showcase how this industry thrives on competition, with consumers across the country the ultimate beneficiaries. This track record has been built for over the past two decades, and it remains true today.