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MVNO_Cash_Flow_Projection

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MVNO_Cash_Flow_Projection Powered By Docstoc
					Sample MNVO Cash Flow Estimator -- Prepaid Model
                              Month 1              Month 2             Month 3             Month 4
               Adds/Month         1,000                  3,000               5,000               5,000
                Active Units      1,000                  3,940               8,704              13,181
          ARPU (less taxes) $    33.00 $                33.00 $             33.00 $             33.00
            Gross Revenue $ 33,000.00 $             66,980.00 $        147,961.20 $        224,083.53

    Avg Wholesale Cost/Unit    $     16.00 $             16.00 $             16.00 $             16.00
            Avg Profit/Unit    $     17.00 $             17.00 $             17.00 $             17.00
                Avg Margin             52%                 52%                 52%                 52%

   Net Acquisition Cost/Unit   $     76.20    $         76.20     $         76.20     $         76.20
       Net Acquisition Costs   $ 76,200.00    $    228,600.00     $    381,000.00     $    381,000.00

                      Churn            6%                  6%                  6%                  6%

          Maintenance/Unit          $3.00                $3.00               $3.00               $3.00
              Maintenance      $ 3,000.00     $      11,820.00    $      26,110.80    $      39,544.15

              Net Income       ($62,200.00)       ($173,440.00)       ($259,149.60)       ($196,460.62)
         CUMM Net Income       ($62,200.00)       ($235,640.00)       ($494,789.60)       ($691,250.22)




‘Adds/Month’ -- new activations
‘Active Units’ -- total subscribers after factoring in churn.
‘ARPU’ -- Average Revenue Per Unit. The CTIA reported average prepaid ARPU is around $27
‘Avg Wholesale Cost/Unit’ -- the charges incurred from wholesale service providers for the retail usage (ARPU)
‘Avg Gross Profit/Unit’ -- wholesale costs subtracted from retail revenue.
‘Avg Gross Margin’ -- gross profit divided by sales revenue. Actual margins are determined by the combination
‘Net Acquisition Cost/Unit’ -- calculated on next worksheet
‘Churn’ -- subscriber attrition as a percentage of the total subscriber base.
‘Maintenance/Unit’ -- the ongoing direct costs to support the customer, such as Call Center, IVR, and billing.
‘CUMM (cumulative) Net Revenue’ -- a running total of how much is made or lost, and does not include other s
 Model
                  Month 5             Month 6             Month 7             Month 8             Month 9      Month 10
                        5,000               5,000               5,000               5,000               5,000         5,000
                       17,391              21,347              25,066              28,562              31,849       34,938
             $         33.00 $             33.00 $             33.00 $             33.00 $             33.00 $       33.00
             $    295,638.52 $        362,900.21 $        426,126.19 $        485,558.62 $        541,425.10 $ 593,939.60

             $          16.00 $             16.00 $             16.00 $             16.00 $             16.00 $             16.00
             $          17.00 $             17.00 $             17.00 $             17.00 $             17.00 $             17.00
                          52%                 52%                 52%                 52%                 52%                 52%

             $         76.20     $         76.20     $         76.20     $         76.20     $         76.20     $         76.20
             $    381,000.00     $    381,000.00     $    381,000.00     $    381,000.00     $    381,000.00     $    381,000.00

                          6%                  6%                  6%                  6%                  6%                  6%

                        $3.00               $3.00               $3.00               $3.00               $3.00              $3.00
             $      52,171.50    $      64,041.21    $      75,198.74    $      85,686.82    $      95,545.61    $    104,812.87

                 ($137,532.99)        ($82,141.01)        ($30,072.55)         $18,871.81          $64,879.50         $108,126.73
                 ($828,783.21)       ($910,924.22)       ($940,996.76)       ($922,124.96)       ($857,245.46)       ($749,118.73)




is around $27
ders for the retail usage (ARPU).

determined by the combination of (1) costs from wholesale contracts, (2) revenues from retail offerings, and (3) the avera



 Call Center, IVR, and billing.
st, and does not include other start-up costs, G&A, or cash reserve requirements; these need to be factored independently
              Month 11      Month 12      Month 13      Month 14      Month 15      Month 16
                     5,000         5,000         5,000         5,000         5,000         5,000
                   37,841        40,571        43,137        45,548        47,816        49,947
            $       33.00 $       33.00 $       33.00 $       33.00 $       33.00 $       33.00
            $ 643,303.22 $ 689,705.03 $ 733,322.73 $ 774,323.36 $ 812,863.96 $ 849,092.12

            $          16.00 $             16.00 $             16.00 $            16.00 $           16.00 $           16.00
            $          17.00 $             17.00 $             17.00 $            17.00 $           17.00 $           17.00
                         52%                 52%                 52%                52%               52%               52%

            $         76.20     $         76.20     $         76.20     $         76.20   $         76.20   $         76.20
            $    381,000.00     $    381,000.00     $    381,000.00     $    381,000.00   $    381,000.00   $    381,000.00

                         6%                  6%                  6%                 6%                6%                6%

                      $3.00               $3.00               $3.00               $3.00             $3.00             $3.00
            $    113,524.10     $    121,712.65     $    129,409.89     $    136,645.30   $    143,446.58   $    149,839.79

                 $148,779.12         $186,992.38         $222,912.83        $256,678.06       $288,417.38       $318,252.34
                ($600,339.61)       ($413,347.23)       ($190,434.40)        $66,243.66       $354,661.04       $672,913.38




erings, and (3) the average unused balance upon card/PIN expiration.




e factored independently.
  Month 17      Month 18      Month 19      Month 20      Month 21      Month 22
         5,000         5,000         5,000         5,000         5,000         5,000
       51,950        53,833        55,603        57,267        58,831        60,301
$       33.00 $       33.00 $       33.00 $       33.00 $       33.00 $       33.00
$ 883,146.60 $ 915,157.80 $ 945,248.33 $ 973,533.43 $ 1,000,121.43 $ 1,025,114.14

$        16.00 $          16.00 $          16.00 $          16.00 $          16.00 $          16.00
$        17.00 $          17.00 $          17.00 $          17.00 $          17.00 $          17.00
           52%              52%              52%              52%              52%              52%

$        76.20   $        76.20   $        76.20   $        76.20   $        76.20   $        76.20
$   381,000.00   $   381,000.00   $   381,000.00   $   381,000.00   $   381,000.00   $   381,000.00

           6%               6%               6%               6%               6%               6%

         $3.00            $3.00            $3.00            $3.00            $3.00            $3.00
$   155,849.40   $   161,498.44   $   166,808.53   $   171,800.02   $   176,492.02   $   180,902.50

  $346,297.20      $372,659.37      $397,439.80      $420,733.42      $442,629.41      $463,211.65
$1,019,210.58    $1,391,869.94    $1,789,309.75    $2,210,043.16    $2,652,672.57    $3,115,884.22
   Month 23       Month 24       Month 25      Month 26      Month 27      Month 28
          5,000          5,000          5,000         5,000         5,000         5,000
         61,683         62,982         64,203        65,351        66,430        67,444
$        33.00 $        33.00 $        33.00 $       33.00 $       33.00 $       33.00
$ 1,048,607.29 $ 1,070,690.86 $ 1,091,449.40 $1,110,962.44 $1,129,304.69 $1,146,546.41

$        16.00 $          16.00 $          16.00 $        16.00 $         16.00 $         16.00
$        17.00 $          17.00 $          17.00 $        17.00 $         17.00 $         17.00
           52%              52%              52%            52%             52%             52%

$        76.20   $        76.20   $        76.20   $      76.20    $      76.20    $      76.20
$   381,000.00   $   381,000.00   $   381,000.00   $ 381,000.00    $ 381,000.00    $ 381,000.00

           6%               6%               6%              6%              6%              6%

         $3.00            $3.00            $3.00          $3.00           $3.00           $3.00
$   185,048.35   $   188,945.45   $   192,608.72   $ 196,052.20    $ 199,289.06    $ 202,331.72

  $482,558.95      $500,745.41      $517,840.69      $533,910.24     $549,015.63     $563,214.69
$3,598,443.17    $4,099,188.58    $4,617,029.26    $5,150,939.51   $5,699,955.14   $6,263,169.83
  Month 29      Month 30      Month 31      Month 32      Month 33      Month 34
         5,000         5,000         5,000         5,000         5,000         5,000
        68,397        69,293        70,136        70,928        71,672        72,372
$       33.00 $       33.00 $       33.00 $       33.00 $       33.00 $       33.00
$1,162,753.63 $1,177,988.41 $1,192,309.10 $1,205,770.56 $1,218,424.32 $1,230,318.87

$      16.00 $         16.00 $         16.00 $         16.00 $         16.00 $         16.00
$      17.00 $         17.00 $         17.00 $         17.00 $         17.00 $         17.00
         52%             52%             52%             52%             52%             52%

$      76.20    $      76.20    $      76.20    $      76.20    $      76.20    $      76.20
$ 381,000.00    $ 381,000.00    $ 381,000.00    $ 381,000.00    $ 381,000.00    $ 381,000.00

          6%              6%              6%              6%              6%              6%

       $3.00           $3.00           $3.00           $3.00           $3.00           $3.00
$ 205,191.82    $ 207,880.31    $ 210,407.49    $ 212,783.04    $ 215,016.06    $ 217,115.09

  $576,561.81     $589,108.10     $600,901.62     $611,987.52     $622,408.27     $632,203.77
$6,839,731.64   $7,428,839.74   $8,029,741.35   $8,641,728.87   $9,264,137.14   $9,896,340.91
   Month 35       Month 36
          5,000          5,000
         73,029         73,648
$        33.00 $        33.00
$ 1,241,499.73 $ 1,252,009.75

$        16.00 $          16.00
$        17.00 $          17.00
           52%              52%

$        76.20   $        76.20
$   381,000.00   $   381,000.00

           6%               6%

         $3.00            $3.00
$   219,088.19   $   220,942.90

   $641,411.55    $650,066.85
$10,537,752.46 $11,187,819.31
Sample Acquisition Costs
                             Retail     Wholesale
                             Offer        Cost            Net Cost
                 Handset       $50.00          $60.00        $10.00
           Activation Fee                       $5.00         $5.00
              Distribution                     $10.00        $10.00
               Marketing                       $25.00        $25.00
             Commission                        $25.00        $25.00
  Initial Included Minutes         20           $1.20         $1.20
     Wholesale Rate/MoU         $0.06
                                  Net Acquisition Costs      $76.20

				
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