Average margin per user

Average margin per user

Average margin per user (AMPU) is one of several criteria for measuring the success of telephone companies. It is an alternative to ARPU, which focuses on revenue per unit. The central premise is that by attention to the margin produced per sold unit, not the amount of cash (revenue) earned from each customer, one can afford low volumes and still have a healthy company. High volumes can also bring a significant edge, but only until competition forces prices down. Telecom analysts are traditionally [http://www.mobilein.com/Perspectives/CBOSS_Margins-1.htm "Forget the Renenues - Focus on Margins"] , "MobileIN", April 4, 2005] highly focused on ARPU, due to the fact that the typical telco has had huge infrastructure costs that needs to be serviced by a considerable ARPU.

Another use of AMPU in some telephone companies (in particular Telenor) is Average Minutes Per User, meaning the amount of time (measured in minutes) the average subscriber talks (or listens) in their phones. This term is also called Minutes-Of-Use or MOU.

ee also

Average Revenue Per User

References


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