OECD telecommunication price baskets

Bookmark this page: www.oecd.org/sti/telecom/pricebaskets

Measuring the prices of voice services is complex. The amount consumers pay each
month is determined by a mixture of monthly subscription fees, per-call and per-text
charges. Adding to the complexity is the fact that many subscriptions include a certain number of included calls, minutes or texts.

One solution for comparing prices amid this complexity is building a standard “basket” of monthly consumption and then comparing how much it would cost to purchase this basket in each OECD country. The OECD has a methodology for building representative baskets which was developed with input from member countries and telecommunications operators. The baskets are routinely updated as usage patterns change.

Each OECD basket represents one standard level of consumption and is not intended to reflect specific calling patterns in a particular country. National calling patterns often vary considerably between countries. Instead, the baskets compare the price of buying a set amount of telecommunication services across countries. The breakdown of baskets is decided in discussion with operators and policy makers from across the OECD.

Fixed (PSTN) Baskets

The OECD fixed line baskets examine the price of making a set basket of calls over the period of one year. The baskets include a set number of calls which vary according to duration, distance, destination (fixed, mobile and international), and time of day. The distribution of calls is based on data from operators across the OECD who provide information on actual calling patterns. Once the breakdown is set and agreed upon, the same calling pattern is used to compare prices of different plans across the OECD. Operators submit their best offers considering the demands of the basket.

(per year)

* Assumes calls are billed by the second. Operators rounding up to the nearest minute will require more minutes to fulfil the baskets.

Mobile Baskets

The OECD mobile baskets examine the price of making a set basket of calls over the period of one year. The mobile call baskets include a pre-determined number of calls, SMS and MMS messages each year. The ratio of on-network and off-network calls is determined through discussions with operators. Operators also provide the OECD with data on SMS and MMS patterns.

(per year)

* Assumes calls are billed by the second. Operators rounding up to the nearest minute will require more minutes to fulfil the baskets.

Leased Lines

Leased lines are symmetrical transmission channels provided permanently for the duration of a contract. They are often used by businesses as a way to connect offices and branches to each other or link back to a telecommunications provider. Businesses commonly use a network of leased lines as a way to effectively manage their own telecommunication services. DSL connections are increasingly replacing leased lines for businesses and this is part of the explanation for falling prices over the previous decade. The leased line price data below represents

For up-to-date basket results, the Teligen T-Basket system provided by Strategy Analytics provides quarterly updates and extended detail. Please see http://www.strategyanalytics.com/teligen.html for more details.