(From Business Line)
FOR decades, the acronym ARPU, standing for Average Revenue Per User, has been the most sacrosanct metric for measuring the success of mobile operators worldwide. Even in India, this timeless metric (in conjunction with a few others) has been used for comparing the performance of different mobile operators in the country.
The conventional wisdom of using ARPU for evaluation has been called into question in a research report by The Shosteck Group, a telecom consultancy based in Maryland, US. According to this group, as ARPU became an accepted metric, some assumptions have been taken for granted by financial analysts. They are:
- The margins which are derived …