Friday, April 22, 2022

Monetization of Higher Data Consumption Remains a Key Issue for ISPs

Virtually all internet service providers worry to some degree about monetizing growing data consumption on the part of their customers. But monetization is a bigger problem in some markets than in others. 


If consumption and revenue were strictly linear, as once was the case for long-distance telephone communications, the highest usages would correlate with the highest revenue, all other things being equal. Looking at mobile ARPU, some markets including India and South Africa show the monetization issue.

soruce: Cisco, Kagan Research 


In most markets, though, monetization is sticky on the revenue side. Average revenue per user might not increase as usage grows. To remain viable under such circumstances, an ISP must reduce costs per delivered bit or find additional revenue sources with higher profit margins and stronger revenue growth profiles. 


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