By Nir Asulin, CEO, FTS
May 7, 2013
As we know, one of the biggest challenges that operators face with the arrival of 4G networks is how to better monetize them. Customers now expect low-cost voice calls and texts as standard, leaving data – especially 4G data – as the revenue-generating opportunity with the most potential for operators. Operators need to examine how to maximise this opportunity in the smartest way possible, and this is the area in which policy control and charging can play a vital role, not only as a method of effective traffic and subscriber management, but also as a means of providing operators with the ability to create more revenue streams.
The biggest problem that operators are facing to date is that their back-end systems are both cumbersome and expensive to alter. And the billing or even the policy management systems that were right as we moved into the 3G era are no longer fit for purpose as we move to 4G. As changes happen in the market, it can take operators months to react to them and put in place charging and pricing plans that fit with their customers’ requirements and rival their competitors. Slow reaction times and costly change requests mean that operators are struggling to innovate.
As Teresa Cottam has highlighted, the need to integrate complex, multiple systems can slow things down. There are a number of vendors looking for solutions to the problem of integration, some with refreshing new approaches, but until these are implemented, integration remains one of the biggest bottlenecks to product, pricing and marketing innovation.
However, even if the integration and interfaces issues are solved, the question is whether the operator has the ability to work as quickly to implement innovative campaigns as fast as its marketing department is developing them.
As operators look for ways to get higher margin customers to spend more on data services, smarter telecom billing and policy control solutions will enable them to create new cross-selling plans and innovative programs on the fly, generating new revenue streams which are limited only by the marketing department’s imagination.
Take, for example, a wireless provider that wants to encourage its subscribers to sign up for premium data services. It uses a policy control and charging solution that provides quota-based credits for the data used on these premium services, enabling consumers to be refunded the data they use when accessing services such as VoIP or online gaming. The credits, on top of their regular Internet quota, mean that consumers no longer ‘pay’ twice for additional services. This incentivises subscribers to sign up for premium services, something they might be unwilling to do in a world of simple consumption control, where it would just ‘eat’ their entire quota. Enabling innovative cross-selling plans allows the operator to generate increased revenues, whilst enhancing its customers’ satisfaction.
This is a real-life example that was implemented using FTS’ Policy Control and charging solution with no delay by the service provider’s own IT team, once it was conceived by the CSP’s marketing team, and without the need to revert to the vendor for long change request processes which would delay the service introduction.
Another sector operators are also turning to as a new source of revenue is the fast-growing M2M market. Here, too, policy control and charging solutions can enable smarter monetization of these services. To take full advantage, what is needed is a PCRF and charging tool that employs a dynamic business-rules engine providing unlimited policy and charging rules to create on-the-fly micro-segmented strategies. The M2M world is characterised by a complex range of business formations which may also involve numerous partners in a highly complicated value chain. Policy control therefore needs to enable M2M service providers to apply different quality of service levels, priorities and policies to different services or devices, and implement flexible service plans based on recurring and non-recurring rates, usage charges, data usage, interactions frequency, criticality of data (e.g. health and security vs. media and entertainment segments), discounts, promotions, bundling and packaging, etc.
As the new networks are sold on increased speed, it is the speed of the BSS platforms that will help the operators take full advantage of them. Responding to operators’ requirements for LTE billing, charging and policy control systems that meet the new demands of the 4G era enables them to create cross-selling plans and innovative programs in real time. In this way, it is possible to not only keep subscribers happy in the longer term but also to ensure that operators can better monetise their networks and take advantage of new revenue opportunities such as mobile money or M2M.
Even after solving interfaces issues, the question still remains of what to do with these integrated systems. Without a good platform on which to implement innovative services quickly and easily, operators cannot take advantage of the increased capabilities of LTE. With such a platform in place, telecom operators can introduce new plans encouraging subscribers to adopt premium services, or create solutions that fulfil the billing needs of emerging market sectors such as machine-to-machine billing or mobile money. The right billing system will take you from not only getting your ducks in a row but also to showing them the right way to go.
Nir Asulin is CEO of FTS. FTS provides convergent billing, customer care and policy control solutions that have greater flexibility and provide greater independence for communications and content service providers, resulting in a dramatically lower total cost of ownership (TCO).