Customer Lifetime Value

Small rural broadband providers are seeing average customer lifetime value (CLV) of just over $5,000, according to a new report from the National Rural Telecommunications Cooperative (NRTC).

CLV measures subscribers’ profitability over the average subscriber lifetime.

The report is based on a survey of NRTC’s rural broadband provider members. The survey had 84 respondents, including traditional telecom providers as well as electric cooperatives that offer broadband. Respondents are in 33 states.

About one-quarter of respondents have less than 2,000 subscribers, while another quarter have more than 15,000 subscribers. The median number of subscribers is 6,100.

Other interesting provider metrics from the report titled “Rural Broadband Operations Benchmarking Report“:

  • 100% of respondents offer broadband internet service.
  • 91% offer voice service.
  • 32% offer video service.
  • Average revenue per user is $74 monthly.
  • Customer acquisition cost is $135.
  • Average churn is 0.9% but is lower for higher-speed tiers and higher for lower-speed tiers.
Source: NRTC Rural Broadband Operations Benchmarking Report

Nearly two-thirds of respondents (64%) have competition offering broadband speeds of at least 100/20 Mbps. Not surprisingly, providers with the least competition have the highest take rates (53%), while those with the most competition have the lowest take rates (33%).

Telecompetitor is published by Pivot Group, which is owned by NRTC.

Updated to state that average customer acquisition cost is $135

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