Prospects Response Qualified Prob 80% Final Share Effective Cost Per Total Cost Cost Per Final

Reached Rate Customer Prospect Customer Customer

Rate Acquisition
cost per
customer
Direct Mail 300000 2% 6000 0.67 4000.00 0.80 3200.00 11.76% 1.07% 1.5 450000.00 140.63 16.54

Take-ones 2000000 2% 30000 0.33 10000.00 0.80 8000.00 29.41% 0.40% 0.25 500000.00 62.50 18.38

Direct Sales 30000 50% 15000 0.67 10000.00 0.80 8000.00 29.41% 26.67% 18000/sales p 225000.00 28.13 8.27

Bind-ins 3000000 1% 30000 0.33 10000.00 0.80 8000.00 29.41% 0.27% 0.15 450000.00 56.25 16.54

5330000 81000 34000 27200 59.7426470588

1
Number of Customers 250,000 480,315 500,000 750,000 1000000 1250000
Avg Rev per Customer $ 162.25 $ 162.25 $ 162.65 $ 162.65 $ 162.65 $ 162.65
Less
Avg Direct cost/cust $ 25.00 $ 19.25 $ 19.00 $ 13.00 $ 7.00 $ 7.00
Avg Acquisition cost/cust $ 59.74 $ 59.74 $ 59.74 $ 59.74 $ 59.74 $ 59.74
Total Direct Costs $ 84.74 $ 78.99 $ 78.74 $ 72.74 $ 66.74 $ 66.74
ContributionNew
$ 77.51 $ 83.26 $ 83.91 $ 89.91 $ 95.91 $ 95.91
Customer
ContributionExisting
$ 137.25 $ 143.00 $ 143.65 $ 149.65 $ 155.65 $ 155.65
Customer
# of New Customers 250,000 250000 250,000 250,000 250,000 250,000
# of existing customers 0 230315 250,000 500,000 750,000 1,000,000
New Contribution $ 19377500.00 $ 20815000.00 $ 20977500.00 $ 22477500.00 $ 23977500.00 $ 23977500.00
Existing Contribution $ 0.00 $ 32,935,045 $ 35912500.00 $ 74825000.00 $ 116737500.00 $ 155650000.00
Total Contribution $ 19377500.00 ### ### ### ### ###
Fixed Cost: Infrastructure $ 35000000.00 $ 50000000.00 $ 50000000.00 $ 65000000.00 $ 80000000.00 $ 95000000.00
Profit/Loss before
-$ 15622500.00 $ 3750045.00 $ 6890000.00 $ 32302500.00 $ 60715000.00 $ 84627500.00
Advertising
Advertising $ 2000000.00 $ 3750000.00 $ 4000000.00 $ 6000000.00 $ 8000000.00 $ 10000000.00
Cumulative Profit/Loss -$ 17622500.00 $ 45.00 $ 2890000.00 ### $ 52715000.00 $ 74627500.00
Cumulative Profit/Loss
-$ 17.62 $ 0.00 $ 2.89 $ 26.30 $ 52.72 $ 74.63
(millions)
BREAKEVEN