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Develop a 5-year Business plan for a telecom operator: Market size 10 million subscribers growing at 20% a year and growth rate going down to
Develop a 5-year Business plan for a telecom operator:
Market size 10 million subscribers growing at 20% a year and growth rate going down to 10% in last year
Market Share at end of year 0 = 10%
Share of net adds 15% going up to 30% in last year
Churn starting from 30% going down to 15% in last year
Subscriber acquisition cost US$ 5.00 going down to US$ 2.50 in last year
Marketing cost 10% of revenue going down to 7% of revenue
Interconnect cost is 3 cents per minute
License fee 1% of revenue less interconnect cost
Other OPEX 35% of revenue going down to 25% in last year
Revenue calculations
o Pricing 3 packages
Afixed cost US$ 5.00
Free minuteson net 50 off net 20
OG on net 5 cents/minOff net 7 cents/min
Bfixed cost US$ 7.50
Free minuteson net 75 off net 50
OG on net 3 cents/minOff net 5 cents/min
Cfixed cost US$ 10.00
Free minuteson net 100off net 75
OG on net 2 cents/minOff net 4 cents/min
o For all packages, below criteria applies:
Peak hours usage is 70% of usage
Off peak tariffs reduce by 25% from peak tariffs
On net is 65% of the traffic
Subscriber split is 50%, 30% and 20% on packages A B and C respectively
Average monthly usage per subscriber is 300 MOUs on Package A, 500 MOUs on Package B and 800 MOUs on Package C
For revenue projection, assume growth in usage of 5% per year with same call mix
Outputs Expected:
1. Revenue
2. Gross Profit
3. EBITDA
4. List of additional information/data points required to forecast Net Income
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