MoU (minutes of use) is a measurement usually in minutes time unit that show how long each user (in average) consumes a product/service in a month. This measurement often used in telecommunication industries or other industries which the product/service consumption is due to time unit (time based pricing) such as : electric/power companies, gas companies, sterilized water companies, etc. The value of MoU can be used as one of performance indicators in some businesses.
Just like MoU, ARPU (Average Revenue Per User) is also one of performance indicators in running one business. This is the measurement usually in currency unit (such as : US $, ID Rp., Poundsterling, etc.) that show how much money each user spend to consume one or more products or services.
Both of MoU and ARPU are indicate the business performance that still could be related to the revenue as its end result. For example : a service company has 3,000 customers with MoU’s value is 120 minutes per month. If the unit price of its service is US $ 1.5 per minute (in average), we can conclude that the monthly revenue of that company is = 3,000 x 120 x 1.5 = US $ 540,000. Assumed if the next coming month the MoU increase to 150 minutes at the constantly unit price. We can easily calculate the revenue based on the previous month revenue. We just do the simple mathematics operation as follow : 150/120 x 540,000 = US $ 675,000.
Just like MoU, almost the same simple mathematics operation do in ARPU calculation, but a little more simple. For example : if the ARPU of a company is US $ 180 and the number of customers is 3,000 users then the revenue of that month is = 3,000 x 180 = US $ 540,000. Imagine if in the next coming month the value of ARPU increase from US $ 180 to US $ 225. The revenue will be increase also to : 225/180 x 540,000 = US $ 675,000.
In the reverse mathematical operation we can see the differences of these two kinds methods. We can see the differences from its formulated variables. Variables that effect to MoU are totally time usage (for all customers) and number of customers. In other side, ARPU’s variable are : the number of customers and the totally revenue. Either ARPU or MoU is indicate the using of each customer in a month or one periodic time. The only different is it’s the measurement unit. ARPU measured in currency but MoU measured in time unit. They both have the same variable, number of customers. To the increasing of revenue, they both still indicates the same symptomp too. The increasing of ARPU indicates the increasing of revenue, and so does the MoU.
The only question is : when do we use ARPU and when do we use MoU in our analysis ?
ARPU usually use for two or more products consumption combination, and usually the measurement unit also variated too. For example a telecommunication operator that provides voice call (pricing in US $ per minutes), data internet (pricing in US $ per Mbyte), and also mailbox feature (pricing in US $ per month). We should use ARPU method for analysis. For getting the ARPU’s value, we have to calculate the average of invoice of all customers we have. But if in case internet service provider which used flat rate time based charging method, we could use MoU method for analysis in order to evaluate the business performance.
Actually, MoU and ARPU would be better used in complementary one another. In case above, for heterogenic products we usually use ARPU for our analysis. But for further analysis, we could also use MoU (for detailed specific product) such as MoU for International Call, MoU for VOIP, and MoU for local call.
MoU also could be used for analysis which the objective is to know or evaluate the effect of marketing program especially in pricing to the increasing of the usage of every customers (in average).
...Read more...!
Just like MoU, ARPU (Average Revenue Per User) is also one of performance indicators in running one business. This is the measurement usually in currency unit (such as : US $, ID Rp., Poundsterling, etc.) that show how much money each user spend to consume one or more products or services.
Both of MoU and ARPU are indicate the business performance that still could be related to the revenue as its end result. For example : a service company has 3,000 customers with MoU’s value is 120 minutes per month. If the unit price of its service is US $ 1.5 per minute (in average), we can conclude that the monthly revenue of that company is = 3,000 x 120 x 1.5 = US $ 540,000. Assumed if the next coming month the MoU increase to 150 minutes at the constantly unit price. We can easily calculate the revenue based on the previous month revenue. We just do the simple mathematics operation as follow : 150/120 x 540,000 = US $ 675,000.
Just like MoU, almost the same simple mathematics operation do in ARPU calculation, but a little more simple. For example : if the ARPU of a company is US $ 180 and the number of customers is 3,000 users then the revenue of that month is = 3,000 x 180 = US $ 540,000. Imagine if in the next coming month the value of ARPU increase from US $ 180 to US $ 225. The revenue will be increase also to : 225/180 x 540,000 = US $ 675,000.
In the reverse mathematical operation we can see the differences of these two kinds methods. We can see the differences from its formulated variables. Variables that effect to MoU are totally time usage (for all customers) and number of customers. In other side, ARPU’s variable are : the number of customers and the totally revenue. Either ARPU or MoU is indicate the using of each customer in a month or one periodic time. The only different is it’s the measurement unit. ARPU measured in currency but MoU measured in time unit. They both have the same variable, number of customers. To the increasing of revenue, they both still indicates the same symptomp too. The increasing of ARPU indicates the increasing of revenue, and so does the MoU.
The only question is : when do we use ARPU and when do we use MoU in our analysis ?
ARPU usually use for two or more products consumption combination, and usually the measurement unit also variated too. For example a telecommunication operator that provides voice call (pricing in US $ per minutes), data internet (pricing in US $ per Mbyte), and also mailbox feature (pricing in US $ per month). We should use ARPU method for analysis. For getting the ARPU’s value, we have to calculate the average of invoice of all customers we have. But if in case internet service provider which used flat rate time based charging method, we could use MoU method for analysis in order to evaluate the business performance.
Actually, MoU and ARPU would be better used in complementary one another. In case above, for heterogenic products we usually use ARPU for our analysis. But for further analysis, we could also use MoU (for detailed specific product) such as MoU for International Call, MoU for VOIP, and MoU for local call.
MoU also could be used for analysis which the objective is to know or evaluate the effect of marketing program especially in pricing to the increasing of the usage of every customers (in average).
