{"id":18345,"date":"2024-05-06T09:30:13","date_gmt":"2024-05-06T13:30:13","guid":{"rendered":"https:\/\/mhgoldberg.com\/blog\/?p=18345"},"modified":"2024-05-06T09:31:56","modified_gmt":"2024-05-06T13:31:56","slug":"arpu-trends-arent-the-same-as-price-trends","status":"publish","type":"post","link":"https:\/\/mhgoldberg.com\/blog\/?p=18345","title":{"rendered":"ARPU trends aren’t the same as price trends"},"content":{"rendered":"

For years now, I keep trying to explain why you can’t look at ARPU trends to determine trends in pricing. Conflating ARPU trends with pricing is one of those zombie fallacies – we can’t seem to kill it no matter how hard we try. But I am going to give it another go anyway.<\/p>\n

Last week, the government released<\/a> its annual review of telecom prices [full report pdf<\/a>, 1.8MB]. The report found that “prices for most wireless and home Internet services declined in 2023”. Notably, the media release observed that mobile prices in Japan and the USA were consistently higher than those prices paid in Canada. It is also worth noting that the study was conducted using October 2023 price data. Since then, Canadian mobile prices have dropped more than 10%, while prices have increased in many of Canada’s peer countries.
\n\"ARPU<\/a>
\nWe have seen Statistics Canada regularly reporting declines in mobile pricing of more than 25% as part of its monthly Consumer Price Index. <\/p>\n

So, why the disconnect with ARPU?<\/p>\n

ARPU is a financial analyst measure that calculates average revenue per user, by taking the total wireless service revenues and dividing by the number of subscribers. But, as I wrote 11 years ago, “Not all ARPUs are the same”<\/a>. It just isn’t the same as unit prices. <\/p>\n

Last summer, I wrote another post on the subject, “ARPU doesn’t measure price”<\/a>.<\/p>\n

That was a follow-up to a piece I wrote in 2017<\/a>. I complained at that time about a number of Canadian telecommunications industry observers who confuse ‘ARPU’ with ‘prices’. Plus \u00e7a change, plus c’est la m\u00eame chose.<\/em><\/p>\n

I recently saw a post<\/a> about per capita grocery spending in Canada that resonated with me:<\/p>\n

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Food retail sales in Canada still dropping, based on new data from Statistics Canada (February 2024). <\/p>\n

The misery continues… pic.twitter.com\/Up4f8sRmO1<\/a><\/p>\n

— The Food Professor (@FoodProfessor) April 24, 2024<\/a><\/p><\/blockquote>\n