Australians’ technology spending switches as online services surge

AUSTRALIANS are online for more than four hours every day and spending more money than ever on technology. But what we are paying for is changing dramatically.

AUSTRALIANS are online for more than four hours every day and spending more money than ever on technology but what we are paying for is changing dramatically.

Every adult spends an average $2465 each year on technology and digital services, according to new research by Suncorp, as data packages, online subscriptions and smart TVs swallow money that previously paid for home phone plans and desktop computers.

Technology specialists say subscriptions for entertainment and news services are growing strongly, while virtual reality, wearable technology and smart speakers such as Google Home and Amazon’s Alexa will boom in the next five years.

Australian adults spend more than four hours a day of personal time online.

There have been big jumps in spending on internet and mobile phone plans and subscriptions but falling prices for technology equipment.

“Even when costs come down for stuff, we feel that we need more stuff — we have just added more devices,” said Suncorp’s executive general manager of digital distribution, Tony Wessling.

“As a society we have moved from a fixed cost model to a subscription based model. Even for things like Microsoft — we used to buy a copy and now we rent that service,” he said.

“As a consumer we need to get used to it.”

BEWARE: Afterpay shoppers warned about fraudsters

The research found adults were spending twice as much personal time online as their children, mainly for entertainment, social interaction, banking and paying bills.

Connecting to the internet is Australians’ biggest annual technology expense — $1428 — while average spending on smart watches ($15) and home assistants ($10) is still small but growing quickly.

Adults are spending twice as much time online as children, Suncorp found.

Research group Telsyte’s managing director, Foad Fadaghi, said consumers were holding on to their mobile phones longer but spending more on subscriptions and other digital services.

“We are seeing a slowdown in the replacement of smartphones. A few years ago the average was two years — now it’s up to about three years,” he said.

SHARING: How to make money from your own data

“A whole range of new hardware has emerged in the last year and a half, from smart speakers to virtual reality headsets. The smart speaker is starting to become a hub for connecting additional devices.

“All indicators are that Australians are lapping up technology.”

Suncorp behavioural economist Phil Slade said more than a third of Australians now identified technology as essential to their lives.

“Our devices make complex and tedious things simple and everything we need is in the one spot,” he said. “And when things are simple they feel logical and we feel more confident about making decisions.”

@keanemoney

TECH SPENDING SWITCH

(average annual cost per adult)

2015 2018

Internet plan $447 $828

Mobile phone plan $334 $552

Smartphone $245 $239

Home phone/other $260 $48

Tablet computer $171 $53

Laptop computer $240 $186

Desktop computer $161 $89

Subscriptions/apps $123 $265

Home entertainment $203 $189