Airlines learned a discipline that many telcos still avoid: not every customer should get the same experience, the same price, or the same privileges.

In aviation, value is earned.
In telecom, value is often assumed—and subsidised—before it is proven.

That difference sits at the heart of the acquisition-cost problem playing out across Southeast Asia. Operators routinely lose 18–30% of revenue before customers generate meaningful value, driven by dealer commissions, handset subsidies, and bad debt, plus an additional layer of “hidden” distribution overheads (CRM platforms, dealer systems, logistics, incentive programs, dealerinduced churn, and fraud leakage).  

Other industries redesigned these economics away. Telecom is still paying as if it’s 2015.  

Airlines reward proven value. Telcos subsidise assumed value.
One industry protects margins through discipline. The other funds churn through hope.

In airlines, value is earned before it is rewarded.
In telcos, value is rewarded before it is earned.

What Airlines Got Right: Privilege Follows Proof

Fly once and you are just another passenger.

Airlines don’t give lounge access to firsttime flyers. You do not get upgrades because you downloaded the app. You earn benefits by demonstrating value over time—through spend, frequency, and loyalty.

Only after sufficient mileage and revenue do you cross into Silver, Gold, and Platinum tiers where the experience becomes meaningfully different. This is not discrimination. It is economic design.

Airlines are relentless about matching cost-to-serve and expensive perks to proven customer economics. They reserve premium benefits for passengers who justify them, because “uniform generosity” attracts the wrong behaviour and punishes the most profitable customers.

What Telcos Often Get Wrong: Rewarding Potential, Ignoring Proof

Most telcos do the opposite.

The largest subsidies and the warmest welcome are often reserved for customers who have not yet demonstrated anything—new acquisitions, port-ins, promo hunters. Meanwhile, customers who have paid reliably for years often receive generic offers and minimal recognition.

This creates a loyalty paradox: proven highvalue customers (HVCs) are treated like commodities, while “potential HVCs” receive costly incentives. The market learns a simple lesson: churn gets rewarded.  

And when loyal customers feel invisible, churn doesn’t announce itself loudly—it happens quietly. Your own article references a regional media player losing customers not primarily because of price, but because loyal customers received no differentiation. Telcos are walking into the same trap.  

Why Treating All SIMs the Same Is the Most Expensive Strategy

Uniform treatment sounds fair. It isn’t efficient.

When every customer gets:

• the same acquisition subsidy

• the same service access

• the same retention budget

…three predictable outcomes follow:

1. HVCs get no reason to stay

2. LVCs consume disproportionate care and network capacity

3. CAC rises structurally while ARPU remains flat

In your numbers, dealer commissions (8–15% postpaid, 5–8% prepaid), handset subsidies (5–8%), and bad debt (5–8%) stack quickly—and distribution overhead adds ~3% of revenue. A material portion of that spend is misallocated because it ignores customer value. [jp-prod.as…rosoft.com]

The Commodity Fallacy: Seats Are Commodities Too—Value Isn’t

A common objection is that telcos “can’t differentiate” because connectivity is a commodity, while airlines sell a premium service. This is a comforting myth—and completely false. An airline seat from Point A to Point B is one of the purest commodities in the world: same sky, same airports, same physics, often the same aircraft model. Yet airlines have mastered the art of layering differentiated value on top of a commodity core. Priority boarding, lounge access, mileage multipliers, upgrade paths, dedicated service lines, and elite-only perks transform an identical seat into a radically different experience for high‑value customers. Hotels do the same with identical rooms on different floors. Banks do it with the same savings account but different privileges. Even coffee chains turn a RM12 latte into a loyalty ecosystem. Commodity does not prevent differentiation; it demands it. The real difference is not the product—it is the discipline. Airlines refuse to subsidise unproven customers. Telcos choose to.

What Telcos Can Copy From Airlines

The point is not to copy airline perks.

The point is to copy airline logic: match benefits and cost-to-serve to proven economics.

A practical telco segmentation looks like this:

• HVC (HighValue Customers): high ARPU, strong payment behaviour, long tenure, high margin contribution

• MVC (MidValue Customers): profitable but pricesensitive; the “climber” segment

• LVC (LowValue Customers): low contribution, often high cost-to-serve

• NVC (NoValue / NegativeValue Customers): minimal revenue, high cost and/or high risk; “network fillers” that strain the system  

This is not a marketing exercise. It is a finance-grade operating model: it tells you how much to spend to acquire, how much to spend to serve, and how much to invest to retain.