Trend reversal. After several years as the only AHI category in deflation, telecommunications costs have turned positive. The ABS Communications CPI group is now running at +1.4% year on year, as the long-running handset price decline moderates and plan prices begin to drift upward. This shift ends a period of relief for household budgets from this category.
Subcategory Breakdown
Annual price movements within the ABS Communications CPI group. The handset deflationary tailwind is fading as plan prices rise.
Source: ABS CPI, Q4 2025 release. Subcategory splits are estimates from published ABS group components.
Communications CPI Trend
Annual % change in the ABS Communications group over 12 months.
Source: ABS quarterly CPI, Q1 2025 to Q4 2025.
Why Telecommunications Costs Are Now Rising
The handset deflationary tailwind has ended. For several years, falling real prices for mobile handsets were the primary drag on the Communications CPI. That effect has now largely played out — smartphone prices have stabilised and the easy gains from post-supply-chain normalisation are exhausted. With the handset offset removed, rising plan prices are now flowing through to the headline figure.
Mobile plan prices are drifting upward. The major carriers — Telstra, Optus, and TPG — have been raising entry-level and mid-tier plan prices as they seek to recover margin after years of competitive pressure. MVNO pricing has followed. The period of data inclusions growing faster than prices appears to be over for now.
NBN wholesale pricing is a growing pressure. NBN Co's wholesale pricing has been revised, and some ISPs have begun passing increases through to retail customers. The regulated access pricing framework provides some protection, but the direction of travel in broadband costs is now upward.
Postal services continue to add upward pressure. Australia Post has increased pricing on standard letter services, reflecting structural decline in letter volumes. This adds a small but persistent upward component to the Communications CPI.
The outlook. Telecommunications is unlikely to return to deflation in the near term. With handset prices stabilised and carriers under margin pressure, plan price increases are the more probable trajectory. The category will remain a small but now rising contributor to household cost pressure.