(keitai-l) Re: JPhone introduces Prepay

From: Benjamin Kowarsch <benjk_at_mac.com>
Date: 10/31/01
Message-Id: <627B5ABC-CDFF-11D5-A270-003065501888@mac.com>
On Wednesday, October 31, 2001, at 05:43 , Graham Brown wrote:

> Pre-pay users generally have lower ARPU (average 40-50% lower) *but* as
> an upside it offers a) better cash-flow for operators (ie all money is
> upfront),
> b) a significant reduction in bad-debts (ie people not paying up) and c)
> access to
> a new market (and also a future contract market).

Yup. Also, total cost of ownership of prepaid to an operator is far 
lower than that of postpaid. I have seen cases where prepaid TOC was 
only 1/25th of postpaid.

Return of investment on a billing system deployment can be years, while 
ROI of a prepaid deployment is usually a matter of hours to days. I have 
seen prepaid deployment where the system had paid for itself in less 
than five minutes of going live !!! It is always puzzling and amazing - 
you work on the planning and deployment for months with a whole team and 
then when it goes live it's all paid for in little more than an instant. 
That's when you think "Perhaps I should have negotiated a better 
rate" ... ;-)

And another interesting anecdote is about prepaid in India. Apparently 
India has about 17 million or so dollar millionaires but only about 1 
million taxpayers. Owning a mobile phone there triggers a tax audit. You 
don't need a PhD to figure out that an anonymously owned prepaid phone 
is the choice for all those folks who wold appear to be wealthy enough 
to pay tax but rather don't. And the ARPU of those prepaid phones dwarfs 
any postpaid account elsewhere.

rgds
benjamin


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Received on Wed Oct 31 15:05:21 2001