At its simplest, the calculation of revenue is just total subscribers multiplied by average net revenue per subscriber after interconnect. Unfortunately, both of these figures are subject to a high degree of error. Subscribers need to be divided into different categories such as large businesses, medium businesses, small business and residential, and the total numbers and revenue predicted for each. Tariffing policies need to be consistent with competition and target subscribers. Subscriber numbers need to show the change in subscribers over time and the change in call usage over time, for example due to increasing Internet usage.
Revenue needs to take into account the fall in call charges over time in liberalised environments.
Figure 1 shows the basic manner in which revenue can be calculated. It highlights the important role of interconnect fees. For some WLL operators as much as half their revenue is paid to the PTO in interconnect fees. This figure shows the complexity of calculating revenue. On the positive side, the WLL operator will gain revenue from the call charges levied to the subscriber as well as from interconnect revenue charged to other operators when calls from a different network are terminated on the WLL network.