Sprint - Nextel 2014 Annual Report Download - page 42

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Table of Contents
40
Successor Year Ended December 31, 2013 and Predecessor Year Ended December 31, 2012
Postpaid ARPU for the year ended December 31, 2013 compared to the Predecessor period in 2012 increased
primarily due to higher monthly recurring revenues, including the $10 premium data add-on charges for all smartphones and
device protection fees, combined with other fee increases and a reduction in the number of subscribers eligible for certain
plan discounts due to policy changes and fewer customer care credits. The increase in postpaid ARPU was partially offset by
lower variable usage-based revenues due to the popularity of unlimited plan options, combined with a lower revenue per
subscriber carried by subscribers acquired in the Clearwire and U.S. Cellular acquisitions and growth in sales of tablets,
which also carry a lower revenue per subscriber. Prepaid ARPU for the Successor year ended December 31, 2013 compared
to the Predecessor year ended December 31, 2012 declined primarily as a result of the impact of purchase price accounting to
eliminate deferred revenues, partially offset by the impact of a higher revenue per subscriber carried by subscribers acquired
in the Clearwire Acquisition.
Combined Year Ended December 31, 2013 and Predecessor Year Ended December 31, 2012
In addition to the explanations above, prepaid ARPU for the Combined year ended December 31, 2013 compared
to the Predecessor year ended December 31, 2012 declined primarily as a result of a decrease in ARPU for our Assurance
Wireless brand due to a lower number of active Assurance subscribers as a percentage of the average number of Assurance
subscribers, primarily as a result of the recertification process. This decrease was partially offset by an increase in ARPU for
primarily the Virgin prepaid brands as subscribers are choosing higher priced plans due to the increased availability of
smartphones. ARPU as it relates to our Assurance Wireless brand was also impacted as a result of the recertification process
because those subscribers no longer had a revenue impact after December 31, 2012, but continued to be included in the
prepaid subscriber based until deactivation in the quarter ended June 30, 2013.