Subscriber acquisition cost

Subscriber acquisition cost (SAC) is the average cost of signing up a new customer. It is most frequently used by mobile telecoms companies.

The customer acquisition cost of mobile companies is complicated by the number of costs involved. Mobile telecoms companies frequently pay incentives to retailers who bring in customers for their networks. They also usually subsidise the costs of mobile phones (heavily so in the case of contract customers).

The SAC of contract connections is usually far higher than that of prepay connections because of the greater incentives and subsidies. This is more than outweighed by the greater value to the networks of contract customers who are committed to minimum expenditure levels.

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