I am confused when he says they have 90% “take rate” yet there is another WISP competitor in the area. I assume there are also people with Hughesnet, Exede, mobile hotspots, and Luddites with no Internet. Perhaps he means something other than they have 90% of households in the coverage area as customers.
I can understand with a $20 plan they could sweep up even the people who could almost use dialup. Still 90% market penetration in the face of competition seems amazing. I’m guessing 10% of households in my area don’t have any kind of fixed Internet, either because they don’t need no stinkin’ Internet, or because they just use the data plan on their smartphone. From: Af [mailto:[email protected]] On Behalf Of Chuck McCown Sent: Thursday, January 12, 2017 10:15 AM To: [email protected] Subject: Re: [AFMUG] Price per sub? We see the asymptote converging on about 84% in our FTTH neighborhoods. From: Brian Webster Sent: Wednesday, January 11, 2017 7:36 PM To: [email protected] Subject: Re: [AFMUG] Price per sub? A couple of things that seem to always come up in these deals. One, what future revenue has already been taken by the current owners. What I mean by that are prepaid annual contracts, side deals on site rent in exchange for relay sites, stuff like that. Second, is the owners tend to want you to buy their potential. When you say 90% take rate you should dig in to those numbers. The highest adoption rate in America are only about 80% of households passed. Are they saying 90% take rate on leads that come in? How many homes does their network potentially cover vs. number of subscribers. How much competition is there for those homes. What equipment do they have deployed, signal levels and client distances? This will have a big effect on your ability to upsell bandwidth. If the clients are all marginal connections you will not have the ability to deliver much capacity off the sectors if you want to upsell or if customer want more bandwidth. This means upgrades at your own cost. Third, look very carefully at tower site leases or agreements. Are there any? Do they allow for a transfer of ownership and stay in effect? Are there balloon rent increases that would change your forecasts? Do they have renewal terms that are long enough for you to make your money on the purchase of their company? Large company or small being purchased the tower site agreements are one very important thing to dig deep on the details. Thank You, Brian Webster www.wirelessmapping.com <http://www.wirelessmapping.com> www.Broadband-Mapping.com <wlmailhtml:www.Broadband-Mapping.com> From: Af [mailto:[email protected]] On Behalf Of Mike Hammett Sent: Wednesday, January 11, 2017 9:08 PM To: [email protected] Subject: Re: [AFMUG] Price per sub? I hear that is around 12x - 18x months of revenue and a heck of a lot easier to calculate when ballparking. They know their revenue (or well, is somewhat easy to figure out). They probably can't spell EBITDA. ----- Mike Hammett <http://www.ics-il.com/> Intelligent Computing Solutions <https://www.facebook.com/ICSIL> <https://plus.google.com/+IntelligentComputingSolutionsDeKalb> <https://www.linkedin.com/company/intelligent-computing-solutions> <https://twitter.com/ICSIL> <http://www.midwest-ix.com/> Midwest Internet Exchange <https://www.facebook.com/mdwestix> <https://www.linkedin.com/company/midwest-internet-exchange> <https://twitter.com/mdwestix> <http://www.thebrotherswisp.com/> The Brothers WISP <https://www.facebook.com/thebrotherswisp> <https://www.youtube.com/channel/UCXSdfxQv7SpoRQYNyLwntZg> _____ From: "Chuck McCown" <[email protected]> To: [email protected] Sent: Wednesday, January 11, 2017 3:16:00 PM Subject: Re: [AFMUG] Price per sub? 4x ebitda From: Josh Reynolds Sent: Wednesday, January 11, 2017 2:14 PM To: [email protected] Subject: Re: [AFMUG] Price per sub? How many subs? On Jan 11, 2017 3:13 PM, "Brett A Mansfield" <[email protected]> wrote: When looking at buying a competitor, I'm wondering what everyone's thought is on a price per sub? They don't do contracts and they use the litebeam hardware. I'm not looking for legal advice, just wondering what all of you think is fair. This company has about a 90% take rate in the area they're in. Their plans are $20, $40, and $50/mo. Thank you, Brett A Mansfield
