Earthlink 2006 Annual Report Download - page 42

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Key Operating Metrics
We utilize certain non-
financial and operating measures to assess our financial performance. Terms such as churn and average revenue per
user (“ARPU”)
are terms commonly used in our industry. The following table sets forth subscriber and operating data for the periods indicated:
(a)
Subscriber counts do not include nonpaying customers. Customers receiving service under promotional programs that include periods of
free service at inception are not included in subscriber counts until they become paying customers.
(b)
Acquired subscribers for the year ended December 31, 2006 includes approximately 58,000 broadband subscribers acquired in the New
Edge merger transaction.
(c)
Effective March 24, 2005, we transferred approximately 27,000 wireless subscribers to HELIO in connection with completing the
formation of HELIO.
(d)
Churn rate is used to measure the rate at which subscribers discontinue service on a voluntary or involuntary basis. Churn rate is
computed by dividing the average monthly number of subscribers that discontinued service during the year by the average subscribers for
the year.
41
As of December 31,
2004
2005
2006
Subscriber Data (a)
Narrowband subscribers
3,880,000
3,580,000
3,301,000
Broadband subscribers
1,364,000
1,608,000
1,886,000
Web hosting accounts
144,000
127,000
112,000
Total subscribers at end of year
5,388,000
5,315,000
5,299,000
Year Ended December 31,
2004
2005
2006
Subscriber Activity
Subscribers at beginning of year
5,206,000
5,388,000
5,315,000
Gross organic subscriber additions
3,137,000
2,766,000
2,700,000
Acquired subscribers (b)
12,000
147,000
162,000
Adjustment (c)
—
(
27,000
)
—
Churn
(2,967,000
)
(2,959,000
)
(2,878,000
)
Subscribers at end of year
5,388,000
5,315,000
5,299,000
Churn rate (d)
4.6%
4.6%
4.5%
Narrowband Data
Average subscribers (e)
3,965,000
3,726,000
3,390,000
ARPU (f)
$
18.37
$
16.61
$
15.49
Churn rate (d)
5.3%
5.5%
5.6%
Broadband Data
Average subscribers (e)
1,215,000
1,495,000
1,825,000
ARPU (f)
$
28.77
$
24.62
$
24.93
Churn rate (d)
2.5%
2.6%
2.5%
Web Hosting Data
Average accounts (e)
153,000
136,000
118,000
ARPU (f)
$
25.84
$
24.97
$
25.55
Churn rate (d)
2.4%
2.2%
2.0%