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Because the business model of the carriers is built on a fairly high ARPU of about $45-55. They need to protect that average revenue per user, so they don't rea
by cstejerean 10y ago
Because the business model of the carriers is built on a fairly high ARPU of about $45-55. They need to protect that average revenue per user, so they don't really care what they sell you as long as they get the revenue. At first it was voice minutes. Then as those got cheaper more of the money was made on domestic roaming and long-distance charges. Then those went away and they replaced them with SMS charges. Then revenue shifted to data. At this point data makes up about 60% of the revenue, and I suspect this number will only continue to rise.
The only way for that ARPU to drop considerably is if a new player enters the market that can significantly undercut the existing players, because none of the existing players are willing to see that number drop by half or more. I don't believe such a new entrant will materialize anytime soon due to the high barriers to entry. I suspect the cost of building and operating a wireless network in the US is too high to support a carrier operating on a fraction of the ARPU.