| Pssst, Wanna Buy a New BSS?
 One of the best ways to see what’s available in the world of Business Support Systems is to be part of the selection process within an operator.
By Tony Poulos, Head of Revenue Management Sector, TM Forum One of the challenges I face in my role at TM Forum is keeping abreast of all the innovation and advancement of Business Support Systems, especially around billing and customer care. With the acceptance and adoption of Service Oriented Architectures (SOA), and the move towards all-IP Next Generation Networks, there is a distinct move away from departmental silos and toward taking a more holistic view of requirements. The biggest movement appears to be occurring in the Tier 2, Tier 3 and VNO space, where the expectations from any BSS is to speed up processes, improve service and reduce costs, and that is a tall order to achieve! For most of us, the best way to see what is available is to attend one of the numerous billing and customer care events held around the world each year, including our own Management World series. Here we not only get to hear about advancements in technology and process, we also get to see them. Telco technology is now very much led by vendors and particularly so in the BSS arena. However, to learn more you have to be able to ‘deep dive’ and with so many vendors and products in the marketplace, this becomes a daunting task. One other way is to be part of a selection process within an operator looking for a new BSS, an opportunity I was recently fortunate enough to have. This was a Virtual Network Operator and this was no ordinary method, let me tell you! There was a requirement to make a quick, yet calculated decision in the shortest possible time, and with minimal disruption to the operations. The other critical factor was secrecy, a key element to avoid being inundated by unwanted advances and potentially upsetting existing relationships. An outside consultant/advisor was bought in to determine requirements and draft an architecture for the complete BSS. This was completed in three weeks. Yes, three weeks. And a long list of potential vendors was drawn up. The key requirements were identified and given priority against vendor claims. The VNO prized a strong working relationship with its vendor partner and a flexible architecture that allowed easy integration with their existing customer care partner. Utilizing a managed service, the proximity of the partner and good reference customers of similar ilk were the next key items, and the list was whittled down even further. At about this stage an RFI and then an RFP is issued, but as we all know, everyone is compliant on every point in some way, so the whole evaluation process is pretty well useless. That was all replaced by a ‘beauty contest’ where the short-listed potential partners were invited to an all-day workshop with a set of broad requirements that had to be demonstrated live to the selection panel. That panel was made up of staff from different areas of the operator who attended only the sections that affected them, thus minimizing disruption to internal operations. The evaluations were held off-site and phones and email barred in the room. A tight timetable and diligent, time-conscious staff had the whole process working like a Swiss clock. Four shortlisted vendors, one dedicated day for each, in front of a focused and well-versed audience who ‘scored’ what they saw. The scorecards had their own hidden weightings as well to ensure that the final result would be skewed towards the key criteria being sought. The 5th day was used to go over all the results, listen to individual comments and concerns, and collate the whole process into a final list of two, and proceeding to the next stage for pricing and contract discussions. This was set for 16 working days and a commitment to have the first stage of a system up and running by January 2009. That’s a total of eight weeks from requirements gathering to contract and a further 11 weeks to implementation. Not bad! The part that I found most amazing was the vendor responses and the quality of their systems. Although each was unique in some way, the combination of technology, experience, product knowledge and willingness to participate in a not-so-ordinary selection process speaks volumes about the state of our industry as we move towards NGNs and transformation projects in all types and size of operations. I hope to be able to share the results of the whole process in the months to come. Back to top
Will Billing Flatline in a Flat-Rate World? By Dr. Jens Trötscher, CTO, LHS Vodafone’s former chief, Arun Sarin, warned fellow mobile network operators (MNOs) at this year’s Mobile World Congress against becoming mere transporters of data, or “dumb bit pipes”. If the commoditized, flat-rate future is bad news for MNOs, it could be even more serious for the billing software industry whose systems currently perform the process of producing MNOs’ customers’ bills for billions of individually metered connections each day. In a flat-rate world, is this the end of telecoms billing as we know it? Flattening Out
Flat-rate calling plans have already launched in many countries. In the U.S., Verizon Wireless introduced flat-rate unlimited domestic voice pricing early in 2008 and was quickly followed by AT&T, T-Mobile and Sprint Nextel. European examples include T-Mobile Germany, offering domestic flat-rate calls to any mobile user, and Orange France, which offers fixed line flat-rate calls, data and TV as part of the basic broadband service (mobile not included). However, mobile data access is still expensive, and most take-up has been by laptop business users with mobile modems, not phones. This is partly because the user experience on current mobile handsets is limited, although new, high-end smartphones will radically improve it. In another potential paradigm shift, Helsinki-based Blyk launched a free UK advertising-supported mobile voice and SMS service for 16-24 year-olds. By viewing six ads a day, users are credited with 43 minutes of voice and 217 texts a month. If successful, the service will roll out across Europe later this year. How Long Until the “Flat Line”?
How long until flat-rate billing becomes the mainstream mobile billing model? Handset pricing and availability will cause a bottleneck. In mature markets, the smartphones that make the mobile data access experience worthwhile won’t be widely affordable for another two or three years. In lower income emerging markets, affordability may take six to 10 years. Affordable smartphones will open up flat-rate data access services on a major scale, although these may take time to become established. If mobile data access rates remain expensive, for example to fund major network infrastructure investments, then take-up could remain modest for 15 years. Profile of a Future Digital Citizen
A Habbo survey of 11-18 year-old social networking site users in 31 countries found these teens now use their mobile phones to “access information, communicate and have fun”. While 88 percent regularly communicate using traditional SMS, 71 percent use their handsets as MP3 players, 70 percent take photos and videos, and 64 percent play games on their mobiles. In 10 years, these teenagers, who have grown up with Internet and mobile phone technology, will have real purchasing power. They will be everyday users of multi-play and flat-rate services, such as voice, data, music and video. In addition, they will be selective users of premium services, such as exclusive pay-per-views, downloads or pay-per-play games. The recent pre-release of tracks from the new Madonna album for Vodafone UK customers is a great example of this exclusive content. Once mobile commerce initiatives such as the GSMA’s PayBuyMobile (PBM) bear fruit, consumers will be paying for everything with their mobile wallets. Cash will become obsolete for them when they are confident in the security and fraud prevention measures. These consumers will be also willing to opt-in to receive advertiser or sponsor messages, provided these are targeted and include appropriate incentives. Vodafone has already said it would share advertising revenue with those who opt-in to receive its advertising. These consumers will appreciate the simplicity of their provider’s flat-rate packages, the relevance of their opt-in advertising and will trust the one-stop convenience of their billing statements. However, the provider who fails to deliver in any of these areas, or fails to sort out problems promptly and accurately, will find these customers churn very quickly. The MNO Response
MNOs are best placed to offer multi-play services because they are “masters of mobility”. Other providers such as the former cable companies and fixed-line Internet providers must play catch-up in the mobile arena to compete, perhaps by becoming mobile virtual network operators (MVNOs) and reselling mobile services to their customers. Some MNOs could deliberately adopt a “dumb pipe” strategy, force down costs and increase revenue by retailing to price sensitive customers and wholesaling to MVNOs. But the majority will avoid commoditisation by rolling out more and more value-added services. These will be based on the huge amount of information they have about their customers. Such services will be based on content, m-commerce transactions, the consumer’s location, or the collaborative needs of groups of individuals. Offering these services will involve creating extended value chains with a wide range of partners, together with the necessary charging and settlement activity among them all. For example, a content-based service involving music would require a settlement system between content providers and aggregators, royalty collection societies and record companies. Mobile commerce would require settlements between merchants, credit card companies and banks. Location-based services would require settlements between intelligent GPS map providers, or yellow pages style directory owners. Despite the complex revenue management required behind the scenes, the success of these services depends on offering consumers simplicity, convenience and security. A good example is the Emirates Integrated Telecommunication Company (EITC), which went to market in early 2007 with its new “du” brand. Mobile penetration was already 120 percent, but it captured 30 percent share in 10 months. Central to du’s strategy for its aggressive launch was simplicity and convenience, offering subscribers an innovative triple-play fixed-line, Internet, pay TV and future mobile package that is not only simple to use but also easy to purchase, and which provides a single monthly bill and a single point of contact for support. The New Look of Billing
Flat-rate billing will cover most multi-play services such as voice, data, music and video, but roaming and international calling charges are unlikely to be included in the foreseeable future because of external cost factors affecting the consumer’s home MNO. New, extended value chains will require settlements between partners involved in providing a wider range of value-added services than seen today, including content, mobile commerce, location-based services and collaboration. Mobile commerce will be extremely important to MNOs in the future. If MNOs retain their trusted billing relationship with customers for their m-wallet purchases, they will receive a major boost through valuable retail customer intelligence at their fingertips. This will enable them to predict customer spending to the same degree as loyalty card companies do today. MNOs that wholesale their bandwidth to multiple MVNOs on their networks will see their billing and settlements requirements grow alongside services offered by their hosted MVNOs. MNOs’ billing capabilities will be an important differentiator in this MVNO market. Billing Challenges and Needs
So what will the MNOs’ billing challenges be in the future and what will be the billing systems requirements? More core billing will be flat rate, but there will also be a wider range of premium event-based items to charge for than today. This requires high levels of flexibility to ensure easy-to-understand service pricing including usage, flat-fee and hybrid models. Moreover, as the range of services offered by the MNO increases so do the types of market in which it operates. Tariff flexibility may be even more important to enable the innovative bundles and marketing offers required to compete in numerous markets. In addition, rating engines must also enable sponsorship- and advertising-based business models that support tariffs based on additional rules such as subscriber demographics, brand and click-throughs. Increased billing will take place between partners in the extended value chain in the form of settlements. Billing systems must provide complete flexibility in the management of business partners, including full support of wholesaler and MVNO models, and the ability to provide comprehensive usage statements to rights owners. The value of a customer will become even more important than today, and so will customer care and customer business intelligence, especially for m-commerce. Subscribers will need real-time pricing information to ensure their comfort with these services. So, does a flat-rate telecom world mean the end of telecom billing? It certainly does not. Although the number of billable transactions by MNOs may decline, the range of billable services and the types of markets in which MNOs are operating will increase. With a multitude of new players providing intense competition on many fronts and customers growing ever more sophisticated and demanding, the billing and customer care systems of an MNO and its trusted billing relationship with its customers could become more strategically important than ever before. Back to top
Evangelists Unite! By Tony Poulos, Head of Revenue Management Sector, TM Forum After 15 years involved in telecom billing, I am still amazed at how little billing is appreciated by senior executives of service providers and how poorly those of us in billing and revenue management represent our small, but important world to outsiders. I am one of a small band of crusaders who goes from one telco event to another shouting from the rostrum through presentations entitled “Billing is NOT Boring,” “If You Can’t Bill It, Kill It,” “Billing is Dead, Long Live Billing,” and my own favorite, “Show Me the Money!” Through TM Forum’s Revenue Management Initiative, we call out to anyone willing to listen and evangelize just how important billing is to every single service provider. It is the one thing our industry has mastered and does better than anybody else, really! Who else can micro-bill items as low as 1 cent in value (or who would even bother)? How many businesses can you name that can get people to pay in advance for something, and if they don’t use it in the allotted time frame, forfeit their money? How many industries do you know that can calculate the value of a service continuously while it’s in the process of being used and cut off that service when the money runs out? And, probably less desirable is our ability to create incredibly complex tariff plans for simple voice calls, which is seen by many as making us indispensable, especially at times of staff cutbacks! Billing for some telcos has not only given them a financial and customer service edge, it has also been used as a marketing tool, e.g. the famous MCI ‘Friends & Family’ case. Now with the inevitable move to all-IP networks and the provisioning of triple and quad play services across all technologies, service providers fear that they may simply become the conduit for the traffic and not share in the booty. It’s their ability to charge for almost anything, anytime at any value that may be the difference.
So you can imagine my joy when I recently read an article by Tim McElligott in Billing & OSS World titled “Squashing the Dumb Pipe Theory with Billing.” I have become quite a fan mainly because he sees the positive side of our sub-industry and is not scared to comment on it. This is definitely recommended reading.
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Ask Dr. Bill  Dear Dr. Bill,
Where are service providers in the cycle of fully supporting new video services via their existing/upgraded billing infrastructures? In other words, what is the state of triple play billing today? Is it fully integrated, or are there typically workarounds to “append” bills together.
Mathew Dear Mathew,
Generally speaking, the triple play service providers are usually fixed-line or broadband operators looking at new lines of business utilizing existing network infrastructure. Unfortunately, depending on how long they have been around, their existing voice billing platforms may be next to useless in accounting for the complexities of billing non-voice services, especially when it comes to bundling and video on demand, often required for IPTV services. The usual work around is to buy a fit-for-purpose system that can do rating and charging for the new services and feed the priced record to the main ‘legacy’ system for rolling up into the customer’s final bill. This is known as ‘adjunct’ billing. Dr. Bill If you would like Dr. Bill to help you with any billing-related problems, write to askdrbill@tmforum.org, and your question may be answered in a future column. Back to top |