I think it is more complex then that. I would not call the decrease in prices for certain goods or services deflationary when the clear cause is increased competition. To be sure this is the case with cell phones/plans, other consumer electronics and computers/gaming stuff. Improvements in technology for r&d combined with the cheap labor/manufacturing offshore for those particular products is the primary cause for the improvement in those prices.

However when it comes to commodities that are used for everyday life it is clear that we are in an inflationary environment. Through the past decade we have squeezed and popped bubbles in many different areas, (stock market, real estate, and currently the bond market). However now we are seeing inflation in crucial commodities including food, water and fuel… The free market is determining where our currency should be and unfortunately that will be reflected in higher prices for the stuff we need to live on as opposed to nonessential items.