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Tren Griffin
@trengriffin
, 6 tweets, 3 min read Read on Twitter
"Ten basis points of churn is a billion dollars,” says Donovan, who runs AT&T’s wireless, DirecTV and wired broadband. fortune.com/longform/att-m…

Bundling can lower churn. Costs of other services impact COGS.

Mufasa: "All LTV factors interact in the Great Circle of Life Simba."
Once upon a time in the mobile business what Buffett talks about here was referred to as the "you can only talk on your phone so many hours in a day problem." Of course, people don't talk much on their phones any more and leaving voicemails is what you do to people you don't like
QUIZ: When he said "Ten basis points of churn is a billion dollars" was he referring to revenue, cash flow, accounting earnings, lifetime value or some other financial metric?
HOMEWORK: Use this spreadsheet from David Skok dskok-wpengine.netdna-ssl.com/wp-content/upl… and some assumptions about churn etc to model a 30 basis point reduction in churn on a per customer basis. Watch changes in LTV. Full article, including a downloadable spreadsheet is: forentrepreneurs.com/ltv/
What assumptions are you using in completing the homework if you took up the challenge? Are you looking for the inputs for the model in places like this? investors.att.com/~/media/Files/…
Someone said the direct link to the spreadsheet dskok-wpengine.netdna-ssl.com/wp-content/upl… doesn't work. If so you can find it in the article. forentrepreneurs.com/ltv/
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Tren Griffin
@trengriffin
Bezos: "Kuiper's 3,200 satellites in low Earth orbit is a good business for Amazon. It’s multiple billions of dollars of capex. Amazon is a large enough company that we need to do things that, if they work, can actually move the needle.” geekwire.com/2019/jeff-bezo…
"The US tax code encourages capital investment through the way it treats the depreciation of assets such as power plants ... allowing companies to record profits that are not taxed until later in the life of these assets." google.com/amp/s/amp.ft.c…
John Malone: "Taxes are a leakage of economic value. To the degree it can be deferred, you get to continue to invest that component on behalf of the government. There's an old saying that the government is your partner from birth, but they don’t get to come to all the meetings.”
Read 3 tweets
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Tren Griffin
@trengriffin
When people look at the lifetime value (CLV) formula they may think "Oh this is like math." Yes, there is a formula but if the assumptions are wrong you may have less than nothing. The future of a business can't be calculated like an annuity since humans don't behave predictably.
Bill Gurley and I talked when he was writing this essay about how CLV is a useful organizing tool but you need to be careful about how it is used. All formulas are wrong and some are useful. Applying CLV is a black art --previous experience is helpful. google.com/amp/s/25iq.com…
What is new is that there is far more customer telemetry and new data science tools than ever before and so the scientific method can be applied to managing a customer relationship. But if the assumptions are wrong even with these new tools it may be garbage in and garbage out.
Read 4 tweets
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Tren Griffin
@trengriffin
I attended a book talk this morning by Portland/Chang Mai based Andy Ricker (Pok Pok). Of course, I asked him what the restaurant business is like right now. He said "I don't want to talk about it" and then proceeded to talk about it. He said "just don't do it." Margins are tiny.
Ricker repeated the often heard insight that if you make any profit as a restauranteur it is on the sale of liquor. He was talking today about his 3rd book on noodles. He dissed being an author and then talked about the difficulty of selling his Som drinking vinegars at a profit.
Ricker talked about his time with Anthony Bourdain and said it amounted to about 40 minutes. Most time is waiting for a shot or reshoots.

Bourdain said to Ricker he had the best job in the world but was alone almost all the time and was unhappy. "Driven by what he was doing."
Read 3 tweets

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modest proposal
@modestproposal1
“Stephenson’s strategy is breathtaking in scale and scope”
“The DirecTV deal was never driven by an analysis of what AT&T needed in order to succeed, but rather by what the company would be allowed to buy,” argues Craig Moffett, the Wall Street analyst. “That’s a terrible way to approach strategy.”
“AT&T’s strategy for delivering an integrated offering to consumers has heretofore amounted to simple discounting, and to devastating effect,” he says
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Lenny Mendonca
@Lenny_Mendonca
1/ By popular demand: The class structure for “Business and Public Policy Perspectives on US Inequality” that I teach @StanfordGSB with @PaulOyer. I will post the readings for each class throughout the quarter for those interested.
2/ This class will analyze the growth in inequality in the US over the last several decades and how that trend is likely to continue or change in the future. We will ask if and how public policy can affect inequality.
3/ We will also focus on business's role -- what are the responsibilities of private sector companies, how does inequality affect them, and how should the growth in inequality affect their strategies?
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Declan Ganley
@declanganley
I watched 'AOC' on a TV interview last night. On it she was celebrating Amazon's cancellation of its New York HQ. She said that the $3 billion that Amazon were getting (in tax benefits) could now be spent on education and subway upgrades. She is that financially illiterate.
A well meaning idiot like AOC thinks that the tax breaks that will now not happen, on the cash that will now not be generated at all (in NY), will now somehow magically produce 3 billion of cash from thin air to pay for public services. The stupidity is mind numbing.
Remarkably, the journalist doing the interview didn't ask the question about where this 3 billion would now come from as the only place it was going to be generated was within Amazon. Would Amazon just send 3 billion to New York because AOC & pals frustrated Amazon's plans?
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John Warner
@biblioracle
All of these takes on Schultz as some kind of viable candidate (he isn't) posit a large "middle class" that's economically secure and afraid of policies from the left which could be disruptive. My Q: What middle class? washingtonpost.com/opinions/could…
We know the middle class is shrinking. Incomes haven't kept up with expenses, particularly in health care and education costs. fortune.com/longform/shrin…
Only 39% of households could absorb even a $1000 unexpected expense without accruing debt. I'd think any definition of middle class would have to meet at least this threshold. cnbc.com/2018/01/18/few…
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Anand Ranganathan
@ARanganathan72
Church Attacks. FAILED
Award wapsi. FAILED
Intolerance. FAILED
Make NO mistake. The vipers are writhing in the sand again for something new.
2013. Just 1 year out of 10 under UPA. Rudimentary search reveals more than a dozen lynchings. Guess it was Hindustan then, not Lynchistan.
Don't care two hoots for the govt. They are as useless as their predecessor. But if you come after India with an agenda, I'll come after you
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Anand Ranganathan
@ARanganathan72
38% becomes 85%, headline becomes "Unsolved cases at an all-time high", Police becomes a butt of jokes; and then comes the TOI clarification
Church Attacks. FAILED
Award wapsi. FAILED
Intolerance. FAILED
Make NO mistake. The vipers are writhing in the sand again for something new.
2013. Just 1 year out of 10 under UPA. Rudimentary search reveals more than a dozen lynchings. Guess it was Hindustan then, not Lynchistan.
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