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asked in Estimation by (13 points) | 430 views

2 Answers

+1 vote

Calculations = GSuite Revenue/total payment per user per annum

Assumptions and Facts

  • GSuite Basic - Pay $5/month/user
  • GSuite Business - Pay $25/month/user
  • For both (Basic and Business) market share is 50:50
Calculations
25 + 5 = 30/2 = $15/user/month 
in a year 15*12 = $180
divide $7bn/$180 = 38,888,888m
Answer - 38,888,888 users 
answered by (24 points)
0 votes

Assumptions

  • Revenue comes from subscription as well as ads
  • 10% of the users has Ads turned on

Pricing

GSuite Basic = $5/month/user

GSuite Business = $10/month/user

GSuite Enterprise = $25/month/user

User base (who take GSuite subscription)

GSuite Basic = 80% (Largest number of users on basic plan)

GSuite Business = 5% (Medium number of businesses yet small compared to Basic Category)

GSuite Enterprise = 5% (Small number of Enterprises has large number of users, hence, almost equal to that of Business Category)

Revenue

Total Revenue = Subscription Revenue + Ad Revenue

#Ad Revenue

Assume 10% users has ads turned on.

Assume one user views on an average 10 ads a day with 20% CTR with a $0.20 CPC

One user generates a revenue of 10 x 0.20 x $0.10 = $0.4 per day 

Yearly ad revenue = $0.4 x 250 (working days) = $100

Since, only 10% has ads turned on, for calculation we can say

Yearly ad revenue = 0.10 x $100 = $10 /user/year

 

#Subscription Revenue

Monthly subscription revenue =  0.8 x $5 + 0.1 x $10 + 0.1 x $25 = $7.5 /user/month

Yearly subscription revenue =  $7.5 x 12 = $ 90 /user/year

 

Annual Revenue per user = $10 + $90 = $100

Total Annual Revenue = #Users x $100 = $7B

#Total GSuite Users = 70 Million

answered ago by (30 points)

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