Editor’s Note: Welcome to our weekly Reality Check column. We’ve gathered a group of visionaries and veterans in the mobile industry to give their insights into the marketplace.
One of the game-changing shifts that communications service providers face as they transform their networks for mobile broadband is an evolution from subscription-based business models to service based ones.
Based on current market drivers, telecommunication services are expected to shift from a model characterized by long service durations with standard quality levels and prices to a new model that includes session-based pricing, short service durations and dynamic pricing that require real-time service management.
For CSPs, this shift can place strain on their current business support systems that facilitate the processes necessary to support new business models. Such systems include resource planning; customer relationship management, fulfillment, charging, rating and billing; and trouble management.
BSS systems must be capable of handling complex services as well as be agile in terms of service configuration and ongoing management on a real-time basis. For example, a subscriber could be using their service during low-traffic periods, such as early January, right after the busy holiday season. CSPs could reinforce a positive customer experience by offering that subscriber a gigabyte of data for the month of January for a nominal charge. The customer offer, service configuration, and provisioning can all occur in real-time.
In dealing with the complexities, CSPs challenges can include legacy systems that were built vertically around every service offering and/or duplicate systems resulting from mergers and acquisitions and/or old technologies that necessitate making service configuration changes across multiple systems. CSPs need to “horizontalize” business processes, consolidate systems and retire old and inefficient systems. Dealing with these challenges is key to improving time-to-market for service deployment and to lowering the cost of serving the customer.
Beyond addressing the challenges, CSPs need to plan which BSS processes to optimize, factoring how they can accelerate revenue growth, whether it is a billing system, policy control, service provisioning, analytics or other system.
Crucial to this planning are two primary solutions: the order-to-cash and revenue-management processes.
Order-to-cash solutions help align, streamline, and automate the customer on-boarding processes, helping CSPs create an open and flexible service environment.
In the past, CSPs maintained an order-to-cash process for each one of its services. Today, given a shift toward a services-based model, CSPs must look at their order-to-cash processes holistically to optimize and transform them, accounting for gaps in system capabilities. At a high level, optimizing the order-to-cash process should reduce billing errors, manual processes and provisioning time, and strengthen flowthrough, revenue and profits.
The priority here is accelerating operational efficiency and service rollouts to “get to cash” as soon as possible.
Real-time charging systems enable CSPs to partner with certain over the top providers to offer an enhanced end-user experience based on service partnership models. Additional partnership opportunities are achieved by exposing network and services APIs to the OTT and developer community to further strengthen partnerships and differentiate end-user experience.
For example, a streaming video provider can partner with a CSP to drive a premium customer experience for its subscribers. In this case, the streaming video provider can subsidize the end user’s data cost to download the video over the CSP’s network. In return, the CSP can offer a high quality of service that ensures a differentiated viewing experience. Through an OTT partnership, a consumer’s normal data package with their CSP did not get used up, the streaming OTT provider was able to differentiate its offering above “best effort” competitors and the CSP was able to participate in the value proposition. CSPs can further enhance OTT offerings by enabling “API mashups” across services.
Moving toward a real-time service-based model means that CSPs no longer need to wait until the end of the month to rate their customer billing. This type of flexibility can enable, as an example, localized offers for low-cost roaming for people traveling overseas who may otherwise stash their mobile devices away for fear of incurring expensive international roaming charges. There are limitless numbers of other real-time services scenarios that are possible.
With order-to-cash and revenue management being critical to transitioning to a services based model, CSPs should seek out a trusted partner with deep telecom knowledge of their business to help navigate the complexities of transforming their BSS systems.
Jihad Hermes is VP Strategic Business Development for Ericsson’s operations in North America. He is responsible for overseeing strategic business development for OSS/BSS systems and managed services in the United States and Canada. Hermes has more than 29 years of experience working on strategy and networks in the telecommunications industry. He has held executive positions at Sprint/Nextel, Teligent, PrimeCo/Verizon and AT&T Wireless. He holds his Masters and Bachelors degrees in Electrical Engineering, both from the New Jersey Institute of Technology.