Watching television has been a part of New Zealanders' lives for five decades. For most of that time, the consumers price index (CPI)* has tracked changes in the price of buying and hiring television sets, buying television licences, and subscribing to pay television.
New Zealanders have gone from watching one channel on black and white 'consolettes' that cost about $4,500 in today's terms, to watching an array of free-to-air and pay channels today on flat-panel colour television sets that cost an average of $1,500.
Within three years of the first television broadcast on 1 June 1960, buying a television set had become a significant element of household spending. Television sets were added to the CPI basket in 1966 after a review of goods and services included in the basket. The review was based on spending patterns for the year to March 1963. (The previous CPI basket review was in 1955.)
Black and white television prices
In February 1966, the average price of the 23-inch black and white television 'consolette' tracked in the CPI was about £131 pounds. Allowing for general inflation, that's about $4,500 in today's terms.
Over the next five years, television sets became only marginally cheaper relative to other goods and services. In February 1971, the average price of a 23-inch black and white television set was about $320, or about $4,100 in today's terms.
Because television sets were relatively expensive at the time, many households chose to hire one rather than buy and the CPI tracked those costs. In 1971, the average charge for hiring a television set for two years was $244. This is equivalent to about $3,100 in today's terms, a significant outlay for many households.
Colour television in, black and white television out
Colour television broadcasts began in 1973, not long before the 1974 Commonwealth Games in Christchurch. In 1975, colour television sets were added to the CPI basket. In February 1975, black and white television sets cost about $350, and the 26-inch colour television set tracked in the CPI averaged about $840. In today's terms, that's equivalent to about $7,500, so buying a colour television set in 1975 would have been quite a stretch for many households.
The average price of colour television sets grew in nominal terms, from $840 in 1975 to $1,200 in 1979. The 1979 price was equivalent to about $6,300 today, so in relative terms colour television sets became slightly more affordable over the four years.
Black and white television sets were removed from the CPI basket in 1979. In February 1979, black and white television sets cost about $360, compared with the 26-inch colour television sets being tracked in the CPI that averaged about $1,200.
First pay television service
The first pay television service, Sky, began broadcasting via an ultra-high frequency network to some regions in May 1990, with other regions being progressively added until 1996. In 1997, Sky introduced a nationwide satellite service. Pay television was added to the CPI basket in 1994 as a result of a basket review undertaken in 1993.
From boxes to flat panels
Old-style cathode ray tube (CRT) colour television sets remained in the CPI basket for three decades, with the occasional change in size or style. For example, from 2002, 29-inch flat-screen television sets were tracked, whereas 21-inch models had been priced for some time before that.
Then in 2006, flat-panel television sets were added to the CPI basket, alongside the old-style CRT television sets. Both liquid crystal display (LCD) and plasma display flat-panel television sets were tracked from that time.
Recent changes
As part of the 2008 CPI basket review, CRT television sets were dropped from the basket. LCD and plasma display flat-panel television sets remain in the basket, and free-to-air digital television receivers were added, reflecting the introduction of Freeview.
In recent years, New Zealanders have been buying about 300,000 new television sets each year. In 2009, about three in four of these were LCD television sets.
Back in 2004, LCD television sets cost about $3,500 on average. In 2009, the average price was about $1,400 and they tended to have bigger screens and be of better quality, with higher picture resolutions and contrast ratios.
With the impending arrival of 3D television sets, further changes to the CPI basket might lie ahead.
* Note: The consumers price index (CPI)
The CPI measures changes in the price of goods and services purchased by households. The range of goods and services included in the CPI ‘basket’ is reviewed regularly to make sure it reflects what households actually spend their money on. Changes to the CPI basket track the changing priorities, tastes, lifestyles, and incomes of New Zealand households, but also what’s on the market and how much it costs.
A ‘household’ is defined as a group of people who share a private dwelling and normally spend four or more nights a week together. People in boarding houses, hostels, homes for the elderly, psychiatric institutions, and prisons are excluded.