Question-and-Answer Session
Operator
(Operator Instructions) Your first question comes from the line of Colby Synesael - Kaufman Brothers.
Colby Synesael - Kaufman Brothers
The first question has to do with ARPU. I know you cited a variety of reasons why you do not think it is going to decline any further. But it seems like the experience is not on the Company that want to trend start, it does continue for a little bit. And just trying to get some understanding why you would think more customers were asked for rebates going forward or why more customers were not asked for pricing concessions when they were renewing or signing up going forward? Thanks.
James F. Geiger
Colby thank you. I guess I would still like to reiterate the points that Bob made to start the answer that unlike some of the wire line and wireless competitors that we have faced, we avoid those direct price comparisons by selling package products versus a la carte pricing.
We do have a very low usage component of about 5%, actually just under 5% of our customer revenue is variable and I would say probably that the element that is hardest for us to assign any kind of quantitative factor to you but customers assigned varying levels of value to the applications we provide them and uniquely we have about 30 different apps for our customers to choose from and they find that value equation as evidenced by to strength in our sales numbers. They find that value equation quite compelling, Bob maybe...
J. Robert Fugate
Yes. I will just add something to that Colby.
We look at a number of components of ARPU when we examine our financials and I can tell you that the ARPU that we derived from additional line from customers and applications has been steadily increasing overtime and that has been somewhat offset equally by ARPU decreases from the customer incentives that you asked about.
So, while those have cancelled each other out, we have had some remaining small differences lately related to usage and terminating access and some slight shifts in the package or mix but those are relatively small and we feel that the major movements within ARPU are contained in the increases we see in the application revenue, the additional lines and those being pretty much offset by the customer incentives.
So, the customer incentives are component of ARPU that we manage. They have always been part of our business. We have been doing this for years and we feel like this is something that we have got a pretty good handle on.
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