Year 2 Year 2 Example of Service MRC price percentage MRC price percentage Year n Mix Over Time Service 1 $3,800 $3,200 Service 2 $6,500 $6,000 Service 3 $8,000 $7,700 Service 4 $12,000 $11,500 Service 5 $17,000 $16,800 Service n so, we'll focus on one aspect: the number of orders needed to reach a certain revenue level. As output to the marketing modeling activities previously described, the planner should arrive at a matrix like the one shown in Table 10-9, where there could be dozens of different services. Modeling the entire panoply of services can be daunting, but it's not impossible. One way to simplify the task is to arrive at a proxy environment that has two equivalent services to deal with. One service could be the weighted average MRC of all costs (for example, above $4,000 X 0.3 + 6,500 X 0.2 + and so on), and another service could be 1.5 times the average. For a typical (self-sustaining) data-oriented next-generation carrier, the aver- age proxy service could turn out to be $4,000 MRC and the other proxy ser- vice could be $6,000 MRC. These two services can then be used to compute how many orders are needed to achieve a given bottom line. Two other parameters (leading now to a total of four input variables) are price erosion and service mix change after year 1. Table 10-10 provides an example. In this example, the revenue goals were as follows: 2001 Goal 2002 Goal 2003 Goal 2004 Goal 2005 Goal $6,632,700 $53,060,813 $168,973,793 $364,186,911 $650,929,776 Chapter 10 The pricing of the two services (shown as T1 = Type 1 and T2 = Type 2), the mix in various years, and the erosion in prices are as follows: High-end Service (Type 1) Mid-end Service (Type 2) Percentage in 2001% 0.500 0.500 Erosion factor Average 2001 revenue $6,000 $4,000 Percentage in 2002 0.550 0.450 Average 2002 revenue $5,760 $3,840 Percentage in 2003 0.600 0.400 Average 2003 revenue $5,530 $3,686 Percentage in 2004 0.650 0.350 Average 2004 revenue $5,308 $3,539 Percentage in 2005 0.700 0.300 Average 2005 revenue $5,096 $3,397 Three kin