Well, any metric can be sheep's wool, Tom.
EBITA comes to mind immediately. It isn't even an accounting standard. But Wall St. likes it, even though no 2 companies calculate it the same way. (It isn't a standard so they don't have to). As long as they consistent calculate it the same way year after year.

ARPU on the same network can be a good indicator. If I have a MOTO network and my ARPU is $99 and your MOTO network has $399. Unless you have lots of overhead and pay high leases, you should be more profitable.

In the case of CLECs: when I see one that is focused, with a true target market, selling a limited catalogue of services, with an ARPU upwards of $600, I see a model CLEC. Considering most other CLECs have about 25k customers after 10 years and a couple of acquisitions and have much lower ARPU, there are lessons to be learned from the higher ARPU company.

Take DSL. Most ISPs have the same costs associated with it. Maybe one pays more for IP or labor, but the telecom costs are the same (ATM & DSL loops). So when I see one ISP with DSL ARPU at $100+ and another at $50-60, who do you think is probably doing better?

Plus the less profitable customers you have, the better off you are. It's not like you can make it up in volume, since growth and scale actually eat at profit.

Profit in telecom is hardly ever talked about. It would scare away any investors :)

- Peter

Tom DeReggi wrote:

Or they measure in ARPU to mask profitabilty. A higher ARPU subs is not always more profitable.
Average ARPU also does not show retention rate.
Having an average ARPU of $700 buck does not do any good if they are only a customer for 6 months, if they end up being disatisfied after the fact. Nor is a higher ARPU that much better if the world has to be given away to get the $700 ARPU.

Getting an ARPU of $700 for a T1 speed line is pretty darn impressive. But not neessarilly so, if 20mbps links need to be given away to get it, meaning less growth possibilty. And a reoccurring cost following the ARPU longer.

(Not that I'm saying high ARPU is not good.)

I think their are more important factors like,

Time till ROI?
Profit during that time, and anticipated profit per year after that time (ROI).

Tom DeReggi
RapidDSL & Wireless, Inc
IntAirNet- Fixed Wireless Broadband

----- Original Message ----- From: "Peter R." <[EMAIL PROTECTED]>
To: "WISPA General List" <wireless@wispa.org>
Sent: Tuesday, May 30, 2006 6:12 PM
Subject: Re: [WISPA] This is HUGE!

Because number of subs is the measuring stick.
Revenue is more important; but profit is the most important.
Not many can speak to profit, so they measure in subs.

- Peter

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