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As data consumption continues to skyrocket, service providers are coming to terms with the fact that a once voice-centric market is rapidly turning into a data-centric one. Consumption of data on mobile networks is being driven by a perfect storm of ubiquitous mobile broadband, smart connected devices and new data services. While the growth in data consumption may be exponential, the growth in data revenues is somewhat less stellar. Service providers around the globe are tackling the very real issues of how to best monetize data services while ensuring the best quality of experience.
Today’s data plans typically have one thing in common: They are priced around access. There are many ways to price access such as such as volume, time and speed, but the focus is ultimately on data traffic rather than data experience. In addition, most plans are based around a simple customer/device model, i.e. one data plan per device. Purchase a second device from the same carrier, and you will most likely need to purchase an additional data plan. Add a device to a family account that already has several other devices and data plans, and it is next to impossible to share data between users and devices.
Taking this one step further, what about a data plan that adapts to the type of device or application being used, or offers better quality to a customer based on the type of service they are using and available network resources? It is clear that data monetization models need to evolve to drive new revenue opportunities while at the same time providing customers with far greater insight into their data consumption to deliver a better data experience. Today more than ever, marketing departments are under pressure to deliver a better data experience to their customers using whatever resources are necessary — both from the business side and the network.
This sentiment is clearly echoed in the results of a recently published Amdocs survey on how service providers are looking to meet the challenges of data monetization. The research, conducted by Heavy Reading, is based on 64 qualitative interviews with service providers across the globe including Europe, North America and Asia Pacific. Ninety-two percent of the European service providers interviewed are looking to launch tiered data services within the next six to 12 months, with similar answers in the North American market. An overwhelming 90% of operators responded that convergence of services across lines of business, services and payment methods are needed to enable new business models for data monetization. In addition, more than 80% of interviewed operators said that their future plans include data plans shared between several devices (e.g. tablets, smartphones), with over 65% seeing the need to include data plans shared between several family members.
To deliver on such a business vision requires two key components. The first is flexible, dynamic charging capable of rating data across multiple parameters such as volume, time, tiers, location, type of service and device type. In addition, charging needs to be “customer aware,” managing data consumption within a multitiered customer structure, including shared data allowances between users and/or devices. Finally real-time charging is crucial to deliver immediate insight to customers such data threshold alerts as well as monetary or bandwidth consumption notifications.
To enhance the data experience even further however, an additional layer is required. Service providers are realizing that combining granular network insight and control with charging capabilities is necessary to enable new data monetization opportunities. This idea was clearly revealed in the survey, in which 100% of European service providers said that policy and charging integration is necessary in order to introduce new monetization models and capabilities, followed by 89% of North American service providers and 67% from APAC.
While service providers are unanimous in the need to integrate, the execution of such integration is a different story. Almost all respondents to the survey (91%) indicated they have some policy elements in their network environment today, but in most cases these have been siloed, network facing implementations to support network policies such as subscriber quota allocation (time/volume), bandwidth management, fair usage and bill shock avoidance. As a result, integration between policy and charging solutions has been challenging if not impossible. Over 75% of operators interviewed stated that it is extremely difficult for them to extend their stand-alone policy solutions for a specific use case to support multiple use cases that also involve charging. Some service providers have avoided the integration altogether due to prohibitive costs and complexity.
Successfully integrating policy and charging will therefore be critical to service providers as they try to accommodate customer needs in real time as well as on-demand services that will become more ubiquitous with 4G speeds and capacity.
