Rank: New-farer Joined: 6/22/2011 Posts: 30
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VituVingiSana wrote:Jamani wrote:VituVingiSana wrote:Jamani wrote:Africa almost double India's ARPU and i remember the comment from Airtel COO(CEO) Kenya that the problem with africa is that if you reduce calling rates people go to buy food... trying to justify why their strategy wasnt working in Africa as was in India...
Africa has proved you wrong sir, your results clearly indicates who goes to buy food. Actually, ARPU is a Revenue Measure. When more minutes are used (in a smaller footprint) then it's cheaper to 'produce' them. India is much smaller than 'Africa' [let's stick to Sub-Saharan Africa where Airtel has its operations] yet the population/users are almost equal or lower in SSA. The cost of providing service to remote areas is higher thus (potentially the amount charged) thus ARPU means little without considering the cost of the service. A Base Station in CBD is much busier (could be lower ARPU - more users with shorter calls) than one in Wajir even though the cost of the Wajir station [diesel powered, installation costs, maintenance costs] are much higher. its a measure related to revenue, the average usage... when the Airtel Kenya COO was making that comment he made it in relation to ARPU not in relation to investments or the cost of it. And for a fact, the ARPU in Africa at the time was low compared to India. And talking of india most of their sites are also running of generators. I can't speak of Airtel's base stations in India. No idea. I can talk of some base stations in Kenya. Even in UG (rural areas). ARPU is one of many measures but the bottomline is always profits. Look at KK 2012 vs 2007. Sales in KES have jumped huge but not the volumes coz the $ price of fuel has increased & KES weakened. The revenues (sales) - per station - looked at in isolation is misleading. @VituVingiSana So the bottom line is what we should look @? 
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