VanillaPlus Magazine - August-Sept 2011 by Prestige Media

AUGUST/SEPTEMBER 2011

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20 SU PP & C BIL -PA LE H LIN GE M AR G EN GI T NG IN SI D E

ISSN 1745-1736 P R O F I T S

TALKING HEADS

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D R I V I N G

CSPs must move beyond fighting known revenue risks to attacking the unknowns of their operations, says cVidya CEO

REVENUE MANAGEMENT Scattered data masks revenue potential CUSTOMER EXPERIENCE Happy customers replace green lights as the KPI UNIFIED APM ▼ Time to tidy up the application performance management toolbox

PLUS!

CLOCKING OFF! ▼ A watchdog with more bark than bite, inside TalkTalk's £3m Ofcom fine

Comptel makes 12m in two years from Axiom Systems acquisition • The NEPs are coming, should we worry? • Vodafone Iceland, Tunisiana and Turkcell make vendor selections • Dates for your Diary

13 TALKING HEADS Alon Aginsky, cVidya Networks

CUSTOMER EXPERIENCE MANAGEMENT

CLOCKING OFF!

cVidya Networks is a global provider of revenueintelligence solutions for telecoms, media and entertainment service providers. The company’s product portfolio helps operators and service providers maximise margins, improve customer experience and optimise ecosystem relationships through revenue assurance, fraud and risk management, dealer management, and margin analytics. Backed by a team of highly skilled professional experts and consultants, cVidya’s solutions have a proven track record of achieving rapid ROI and lower TCO. With over 140 customers in five continents and an extensive network of regional offices in Europe, North America, Latin America and APAC, cVidya has one of the largest installed bases of revenueassurance and fraud-management implementations worldwide. cVidya’s customers include: British Telecom, Telefónica Group, Vodafone Group, AT&T, O2 UK, MTN South Africa, Swisscom, Telecom Italia, China Telecom and more. For more information visit www.cvidya.com

IN THIS ISSUE EDITOR’S COMMENT The NEPs are coming, should we worry?

NEWS Company, Market, Product and Contract News plus the People News column

CONTRACT HOT LIST Major contracts awarded globally and the latest Contract News

TALKING HEADS cVidya’s Alon Aginsky shares his view of the new breed of revenue assurance challenges facing operators. They must move from simply addressing known revenue risks to attacking the unknowns of their operations, he says.

REVENUE MANAGEMENT Jonny Evans explains how business insight helps CSPs deploy their resources effectively.

CUSTOMER EXPERIENCE MANAGEMENT Operator focus is moving away from rows of green lights to enabling rich experiences, says Mark Dye.

EXPERT OPINION: CUSTOMER EXPERIENCE Neil Coleman advocates new approaches to close the gap between what networks report and what customers tell them.

UNIFIED APPLICATION PERFORMANCE MANAGEMENT Nick Booth says there are brilliant tools on the market but they won’t work if operators don’t declutter their toolboxes.

EXPERT OPINION: UNIFIED PERFORMANCE ASSURANCE Marc Lippe says user’s performance needs must be addressed from the data centre to the cell tower – and back again.

SPECIAL REPORT PREVIEW 27 Tango Telecom previews a soon-be-published Special Report that looks beyond policy. WEBINAR PREVIEW Ian Tidder previews an upcoming VanillaPlus webinar on policy management.

DIARY Where to go and what to see

VIDEO REVIEW Sudeesh Yezhuvath discusses his recent VanillaPlus video on actionable intelligence.

CLOCKING OFF! Mark Dye explores how TalkTalk may still have made a profit in spite of being fined £3m.

VANILLAPLUS AUGUST/SEPTEMBER 2011

EDITORIAL ADVISORS

George Malim, Editor: VanillaPlus

The NEPs are coming – should we welcome them with open arms?

The sale by Comptel of the Axiom Systems assets it acquired in 2008 to Cisco Systems is illustrative of a continuing trend by network equipment providers (NEPs) to increase their involvement in back office systems at telecoms operators. All the big vendors claim at least some sort of expertise and have products within their portfolios. Nokia Siemens Networks, Alcatel-Lucent and Ericsson all have developed expertise and offer systems. Some, notably Ericsson with its acquisitions of LHS and more recently Telcordia, are making a concerted play in the OSS/BSS market. Others are white labelling the solutions of specialist vendors. Importantly, Cisco has stated that the Comptel acquisition won’t affect its existing partnerships with the company and that’s demonstrative of the co-operation between the OSS/BSS experts and the NEPs. I put it to Comptel’s marketing director that Comptel’s strategy looked similar to car firm BMW’s ownership of Land Rover. BMW acquired Land Rover along with Rover’s car division in the 1990s. Land Rover was the profitable jewel in the crown of the operation and had massive expertise in producing off-road vehicles. BMW’s ownership of just a few year’s saw it successfully sell the business to Ford and, very rapidly, BMW launched it’s own range of off-road vehicles. By buying Axiom Systems and learning about fulfilment, then selling the asset having added broadband fulfilment to its own product range, I suggested to Suard that Comptel was following a similar strategy. Suard wouldn’t be drawn, saying only that he doesn’t know much about cars, but I think there is a wider issue at stake. NEPs recognise that operators are looking to minimise the numbers of suppliers they deal with and see bundling OSS/BSS with their equipment as a differentiator and deal-maker. My concern focuses on who is gaining what in these types of scheme. It is straightforward when Ericsson acquires a company like Telcordia. Ericsson sees value in the company, buys it and integrates it into its range of products and services. Telcordia becomes Ericsson. It is less clear when an OSS/BSS specialist partners with an NEP. How much knowledge does a Nokia Siemens Networks, a Tellabs or a Ciena gain from their OSS/BSS partners? Could they assemble enough to go it alone in future solution generations and cut out the OSS/BSS specialists? Is this attitude of co-operation eroding specialists’ differentiating sector strengths? Is it the opening move in a strategy by NEPs to address the back office without having to make acquisitions? The answers to those questions ultimately depend on the exact nature of each OSS/BSS vendor’s product line and the product line of each NEP but it is clear their interest and involvement in the sector is set only to increase in line with the demands of operator customers. NEPs would argue that OSS/BSS plays a supportive role to the star of the show, their equipment, so it’s not worth re-inventing the expertise of this ‘small’ market for themselves. However, network equipment is what it is. The new business models of the CSP of the future all are utterly dependent on efficient, scalable, flexible back office systems. NEPs know this and they aren’t necessarily the OSS/BSS vendor’s friend regardless of how many cheerful partnerships appear to be in place.

John Aalbers, chief executive, Volubill

Dan Baker, Research Director, Technology Research Institute

Martin Creaner, president, TM Forum

Andreas Freund, VP Marketing, Orga Systems GmbH

Louis Hall, chief executive, Cerillion Technologies

Gaby Matsliach, general manager, BSS Product Line, Comverse

Pat McCarthy, VP of Global Marketing, Service Delivery Solutions, Telcordia

Simon Muderack, COO, Tribold

John Rainger, vice president, EMEA, CSG International

Olivier Suard, Marketing Director, Comptel

Mac Taylor, CEO, The Moriana Group

Chris Yeadon, director of Product Marketing, Ericsson

Doug Zone, chief technology officer, MetraTech VanillaPlus is distributed free to selected named individuals worldwide who meet the Publisher's terms of Circulation Control. If you would like to apply for a regular free copy supplied at the Publisher's discretion visit www.vanillaplus.com If you do not qualify for a free subscription, paid subscriptions can be obtained. Subscriptions for 6 issues cost £99.00 worldwide (or US$150 / EUR125) including post and packing. VanillaPlus magazine is published 6 times per year.

Enjoy the issue. George Malim EDITOR George Malim Tel: +44 (0) 0208 292 4036 george@vanillaplus.com ASSOCIATE EDITOR Mark Dye Tel: +44 (0) 0208 251 8908 md@vanillaplus.com DIGITAL EDITOR Nathalie Bisnar Tel: +44 (0) 1732 808690 nathalie@vanillaplus.com

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Cisco pays €21.3m for Comptel’s Axioss fulfilment software Comptel has sold its Axioss service fulfilment software to Cisco Systems for €21.3 million. Cisco expects the software, originally developed by Axiom Systems, a company that Comptel acquired for Juhanni €8.9 million in 2008, Hintikka, chief to strengthen its executive of service provider Comptel managed services offering through the addition of automated ordering and fulfilment. Core to Cisco’s interest is Axioss’s ability to enable it to extend network and service management technologies across its next-generation IP network platforms and enable service providers to launch new video, data, mobility and cloud services to their customers. Jesper Andersen, senior vice president and general manager, Network Management Technology Group (NMTG), Cisco said. “With the acquisition of Axioss software and talent, we will help enable service providers to generate greater profits using a single management architecture to drive quick monetisation and optimisation of their Cisco network investments.”

Significantly, Comptel will continue to provide solutions in the service fulfilment market from its own portfolio. “Our fulfilment strategy remains unchanged,” said Juhanni Hintikka, chief executive of Comptel. “We will maintain Axioss customer relations. Cisco, as is well known, is a network and services vendor and it has been talking about the ability of this business to support their operator base. The businesss for us continues.” Hintikka added that the price raised will be used to invest in the growth of Comptel and that he estimated the transaction to have a negative net sales impact of approximately €2m in 2011. That figure makes the deal attractive to Comptel. “Most importantly, since Juhanni joined Comptel in January he has made no secret of the need to invest for growth,” said Comptel marketing director, Oliver Suard. “The great thing about this deal is it provides both the incentive and the resources to invest and grow in fulfilment and other areas.” Under the deal former Axiom Systems chief executive Gareth Senior who is now the CTO of Comptel will move to Cisco. Other employees, predominately those in the UK at Axiom Systems’ old headquarters, will also transfer. The transaction is estimated to close in September 2011. Comptel and Cisco will continue their cooperation in cloud mediation and charging.

Redknee and Tech Mahindra join forces for billing and CRM Redknee has signed a global partnership with Tech Mahindra, a global systems integrator and business transformation consulting organisation, to jointly deliver software and services to the communications service provider market. The deal sees the two pooling their expertise and knowledge with Redknee integrating its real-time billing capabilities with Microsoft Dynamics CRM and Tech Mahindra, the 2011 Microsoft Communications Sector Partner of the Year Award winner. By pre-integrating Redknee's solutions into its offering, Tech Mahindra can deliver extended BSS capabilities with a faster deployment speed for service providers. The partnership also widens the scope of business opportunities that Redknee can address among service providers.

According to Larry Goldman, head of telecoms Software Research at Analysys Mason, the deal is indicative of CSPs placing increasing value on fully integrated software solutions. "This agreement provides a broad range of integrated billing, charging, customer care and OSS capabilities that deliver improved time to market and reduced cost," he said. Lucas Skoczkowski, CEO of Redknee believes the move will help it to address new revenue generating channels presented by the cloud. "We see a growing opportunity to address requirements for real-time magnetisation solutions for wireless, multi-service and cloud service providers across the world and we feel that our partner strategy is critical to fulfilling this opportunity," he said.

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Amdocs completes Bridgewater Systems acquisition Amdocs has completed the acquisition of Bridgewater Systems, the provider of policy management and network control solutions. Amdocs acquired 25,178,827 common shares of Bridgewater for CAD$8.20 per share in cash, through a wholly owned, indirect subsidiary of Amdocs. Prior to the acquisition, Amdocs did not own any securities of Bridgewater. The transaction is valued at approximately CAD$211 million (€147.9m) or CAD$139 million (€97.4m) net of Bridgewater's cash as of 30 June. The acquisition will expand Amdocs’ Customer Experience Systems (CES) portfolio, allowing service providers to implement new value-based data monetisation strategies to capitalise on data traffic growth. “This strategic acquisition will enable service providers to completely redefine the real-time data experience and maximise the return on their network investments,” claimed Brian Shepherd, group president for Amdocs. “We are delighted to welcome Bridgewater’s highly innovative, skilled professionals to Amdocs as we continue expanding our market-leading CES portfolio.” Ed Ogonek, president and CEO for Bridgewater, added: “Following this acquisition, service providers will be able to benefit from data experience solutions based on a pre-integrated combination of Amdocs’ leading convergent charging technology and Bridgewater’s advanced policy control capabilities that address the increase in demand for high-bandwidth services and the exponential growth of smartphones and other connected devices.” Ari Banerjee, senior analyst at Heavy Reading, commented: “Standalone policy management provides an optimised network but not the most profitable one, while charging by itself provides monetisation but does not enforce network knowledge. Successful network monetisation needs these two systems to work together, which requires significant integration between the business support systems (BSS) and policy control systems. With the Bridgewater acquisition, Amdocs will be positioned to offer a pre-integrated policy management and charging solution to drive service providers’ data revenue.”

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NEWS IN BRIEF

Developing markets to drive global operator revenues to US$1.1trillion in 2012 Mobile operators in Brazil, Russia, India and China (BRIC) are accounting for a rapidly growing share of global mobile revenue and look set to overtake the US in market size in the coming year. That’s according to a new study from Wireless Intelligence which suggests BRIC operators have recorded the strongest revenue growth in recent years. ‘The Global Cellular Industry Balance Sheet’ suggests BRIC operators have recorded the strongest revenue growth in recent years. Indeed, in 2010 revenues totalled around US$170bn (€117.7bn) in 2010, an increase of US$30bn on the previous two years. The study forecasts that the total revenues generated by mobile operators worldwide will cross the US$1.1 trillion mark in 2012. This will be led by the developing markets which it is believed will contribute over 40% of global revenues by this point - up from 33% four years ago. With global operator revenues having reached US$1.057 trillion last year, the study reveals operators invested around US$200bn in capital expenditure during the year. In the developed world the report says mobile revenue growth has remained flat at around 2% a year since 2009 with as many as 40% of operators in developed markets reporting revenue declines in 2010. Worst hit were operators in Western Europe, Eastern Europe and mature Middle Eastern markets such as Bahrain and the UAE. Strongest revenue growth in 2010 came from the large operator groups with 'developing' footprints such as América Móvil and Telefónica. The report revealed that on average voice service revenue still accounted for 75% of recurring revenues in developing countries in 2010 and 70% in developed countries. Meanwhile, data revenues, excluding messaging, on average represented 16% of total revenue in the developed region in 2010, compared to 11% in the developing region. "Mobile revenue growth in the developing world is, in turn, fueled by operators' expansion in Brazil, Russia, India and China, as well as by demand in fast-growing Asian economies," said Joss Gillet, wireless Intelligence senior analyst and author of the report.

Virgin survey finds 69% of workers demand access to cloud techs In a survey of 1,000 office workers, conducted by Virgin Media Business, the UK enterprise communications provider, 69% said they would like to access all of the software that they use in the office, through a web Mark Heraghty, browser from any managing location or any device. director, Virgin Workers are confident Media Business that their businesses will be able to meet these expectations, with 78% believing that in ten years’ time they’ll be able to access all of their applications over the web from outside of the office. This would equate to over 9.3 million office workers using virtual working technologies by 2021. However, many businesses are slow to adopt, expressing concerns over internet connectivity. In a separate survey of 5,000 business owners, 88% have yet to deploy cloud-based applications within their company. The key concern is whether their network infrastructure is up to task. 22% of business owners say they are not comfortable with using applications via the internet, 20% worry about the reliability of their internet connection and 21% are concerned about how much bandwidth

cloud-based applications will use up. With Gartner estimating that by 2016 all of the Global 2000 companies will be using public cloud services, businesses that ignore these technologies risk being left behind. With cloud computing freeing businesses via remote working, they can stand to make huge productivity gains. For example, Apple has claimed 75% of Fortune 500 companies are testing or deploying the iPad within their organisations, with the likes of Xerox, Estee Lauder, Disney and Prudential Financial having already issued iPads to their workforce. On top of the productivity benefits of working on the move, distributing cool technologies has a positive impact on morale, with many claiming that an iPad trumps on-site showers as the top staff perk. “Business technologies have undergone a radical shift in recent years, with MacBooks now accounting for one-in-ten corporate computers and the iPad now accounting for 1% of all browsing,” said Mark Heraghty, managing director, Virgin Media Business. “Underpinning the penetration of traditional consumer hardware in businesses is the less tangible method of storing and accessing information – cloud computing.”

CSPs face significant operational hurdles in delivery of cloud services Although CSPs are well-placed to take advantage of the burgeoning cloud computing market, they face considerable challenges when it comes to supporting and selling cloud services. That's according to a new report from Ovum which points to the operational hurdles operators face to make a success of cloud services as being ‘significant’. In his report, 'Enabling Telco Cloud Services', Ovum analyst, Mark Giles, argues that although much has been made of the potential for CSPs to leverage existing assets, such as their communications networks, data centres, OSS and BSS systems, they remain hampered by siloed information, a lack of brand identity and proven service delivery in within the cloud space. Indeed, Giles believes that CSPs will have to carefully consider how they deal with

the pace of innovation, pricing and monitoring if they are to be successful. "Infrastructure as a Service is a natural first point of call for CSPs as it leverages their traditional hosting capabilities," he said. "However, as the IaaS market evolves and becomes more competitive, so there will be downwards pressure on prices, and telcos would be wise to ensure that they either position themselves as managers of enterprises' private clouds whilst also acting as an intermediary for public cloud services, or that they ensure they have the flexibility in their back office to be able to explore other pricing models such as dynamic pricing." Giles thinks telcos should follow the lead of players such as SFR and Telstra by seriously considering joint branding, marketing or sales partnerships with existing IT services players in order to maximise their potential.

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VOSS launches 7.4 for delivery and management of unified communications and collaboration services VOSS Solutions, a provider of unified communications and collaboration (UC&C) service delivery and management software, Mike Frayne, has announced the CEO at VOSS general availability of Solutions VOSS 7.4, a highly scalable fulfillment management platform that overarches complex UC&C networks for managed service providers and large enterprises. VOSS 7.4 now supports the latest release of Cisco’s UC applications, including Unified Communications Manager 8.6 and its advanced suite of voice and mobility features; Unity Connection 8.6 and its advanced suite of messaging features; Unified Presence 8.6; Cisco WebEx; and an extensive range Unified Mobility Clients and the latest Cisco

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devices, such as the Cisco CIUS. With VOSS 7.4, the vendor is now releasing its latest integrated UC&C management technology at the same time that Cisco releases its UC applications update. This means that the very latest Cisco UC applications are supported by VOSS management, well ahead of other management systems. “As UC&C becomes more widely adopted, fulfillment management is a necessity, rather than an option,” said Mike Frayne, CEO at VOSS Solutions. “Cisco has recognised this fact with its decision to embed VOSS within its new HCS architecture. VOSS 7.4 not only simplifies the delivery and management of UC&C services and applications through a centralized administration portal, it enables organisations to make radical operational savings at the same time.”

Tekelec introduces integrated LTE solutions including home subscriber server solution Tekelec has integrated its session, policy, performance and subscriber data management products into new solutions for LTE. The company previously announced a win with an unnamed tier-one North American operator, that saw integration of Tekelec’s Home Subscriber Server (HSS) address resolution database with its Diameter Signaling Router (DSR). This allows the service provider to scale LTE services by routing Diameter messages to the appropriate HSS in the network.

probes and network elements to analyse how subscribers are using IP-enabled devices and applications. In addition, Tekelec has added the PIC troubleshooting features to the core DSR platform to continuously monitor the DSR’s performance.

In addition to those two products, Tekelec’s LTE portfolio includes: Policy Server, a Policy and Charging Rules Function (PCRF) that integrates with the HSS and acts as the brain for policy coordination, dynamic bandwidth control, charging, consumption and other factors for a subscriber’s entire data session; and Performance Intelligence Center (PIC), a performance management system that converts network traffic information into useful business intelligence for service providers to improve the customer experience. The PIC integrates with the DSR to eliminate the need for additional

Joe McGarvey, principal analyst at research firm Current Analysis said: “Tekelec’s strategy is to replicate its 2G and 3G network successes in LTE by simplifying and streamlining complex network architectures to enable network scalability, flexibility and reliability.”

Each of the LTE products runs on Tekelec’s Eagle XG middleware platform, built to meet the core network scalability needs of the world’s largest networks.

Ron de Lange, president and CEO at Tekelec, added: “As service providers evolve to LTE, they are discovering new revenue opportunities and architectural hurdles. Tekelec’s integrated LTE solutions are helping our customers scale their networks to deliver advanced, revenue-generating LTE services.”

Outsourcery launches the O-Cloud for critical line of business applications Outsourcery, a cloud service provider, has announced the launch of its new platform, O-Cloud. The solution follows two years of planning, a multi-million pound investment, 2,000 hours of engineering and has been built using technologies from HP and Microsoft. As well as providing a platform for running critical line of business applications and delivering failover, Outsourcery says it will set new standards in providing integrated network-level security and disaster recovery (DR) features such as Intrusion Detection as standard, as well as optional recovery to a secondary site. Outsourcery hopes that a unique selling point for O-Cloud will be the ability to deliver professional transformation services to get customers into the cloud in a planned, measured and specific manner as opposed to leaving them to make their own decisions as to what services are needed. According to James Griffin, director of product strategy, the O-Cloud was built to de-risk the adoption of cloud for line of business applications. He believes that by engineering the platform to include enterprise grade security and disaster recovery features as standard, the company is re-defining acceptable standards for true business-grade cloud operations. Sybase brings intelligence for everyone to the enterprise Sybase, an SAP company, has announced the general availability of Sybase IQ 15.3, powered by a new generation of shared everything Massively Parallel Processing (MPP) technology. With this release, enterprise IT departments can overcome scalability limitations of data warehouses in many industries, including telecoms. By implementing a business analytics information solution that allows sharing of computing and data resources with the innovative Sybase IQ PlexQ™ technology, enterprises can lead the next wave of data warehouse transformation by breaking down user and information silos to drive analytics adoption throughout the entire organisation.

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No other publication works harder or travels further! In a period of global financial turbulence, company failures, re-structures and negative economic growth it seemed like everyone in publishing was battening down the hatches and sitting tight. Everyone that is apart from VanillaPlus magazine. 2010 saw continued substantial growth and investment in VanillaPlus. We enhanced our existing products, broadened our portfolio and invested in our circulation. Whilst other magazines were falling by the wayside, look what VanillaPlus did for you: BOOSTED VanillaPlus increased its presence at key events and attended 54 events in 20 different countries across Europe, Middle East, Africa and the USA – ensuring the furthest possible reach for its advertisers and gaining more key readers around the globe. INVESTED VanillaPlus continued to invest in circulation, adding top level new Operator names across Brazil, Russia, India and Australia. At the same time we cleaned and refined our data and got to know our readers even better. See our 2011 Media Pack for the latest details.

LAUNCHED In 2010 VanillaPlus launched Video Talking Heads – video interviews of key industry players filmed on location across the globe and available to view at www.vanillaplus.com INCREASED In 2010 VanillaPlus increased the circulation of its ezine, VanillaPlus Bites to a whopping 23,000 – with more signing up daily

IMPROVED In 2010 VanillaPlus continued its website improvements – making video available, adding a Knowledge Centre resource, and a full issue archive

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Tunisiana chooses CSG International for interconnect Tunisiana, the Tunisian operator owned by QTEL, has chosen CSG Interconnect to streamline its operational processes, improve revenues, reduce costs and optimise cashflow. John Rainger, The operator, which CSG launched in December International’s 2002 with the ambition vice president of Europe, to become the largest Middle East private primary operator and Africa in the Tunisian market, now has more than five million active subscribers which means it has achieved that aim. CSG Interconnect is an interconnect billing and settlements solution claimed to enable Tunisiana to consolidate and manage all of its partner agreements from a single platform, allowing the provider to access competitive rates, minimise disputes and reduce potential leakage. In addition to the features of the

CSG Interconnect solution, the operator acknowledged CSG’s reputation for ontime implementations and its deep knowledge of the requirements of the market in Tunisia. “We chose CSG due to its position in the interconnection billing area with its ability to deploy a full suite of products in the billing and OSS area,” said Yves Gauthier, chief executive of Tunisiana. John Rainger, CSG International’s vice president of Europe, Middle East and Africa, added:“With CSG Interconnect, Tunisiana is able to substantially reduce its manual processes, speed its reconciliation with partners for faster time to revenue, and easily configure new partner agreements for enhanced service offerings. Tunisiana will also be able to view its interconnect business and value-added services in a holistic fashion through reporting, providing added visibility and control for enabling better business decisions.”

Vodafone Iceland selects CTI Group SmartRecord CTI Group’s SmartRecord carrier-grade call recording solution has been selected by Vodafone Iceland. SmartRecord enables the operator to record telephone conversations on its next generation IP multimedia BroadSoft BroadWorks voice platform to help its customers meet regulatory, quality management and legal demands. Vodafone Iceland’s next generation network is a geographically distributed, hosted, IP multimedia subsystem (IMS) deployment which spans multiple countries and handles multiple network methodologies. The decision to choose an IMS environment was made in order to enable scalable deployment and provisioning, and generate higher revenues per end-user. The integration of the SmartRecord platform into its IMS environment enables Vodafone Iceland to deliver a crucial regulatory application, further increasing user functionality and enabling enhanced application revenues. This validated deployment in an IMS environment opens the door for enabling a call

recording application, regardless of user network access methodology, especially in VoLTE and other wireless environments. Andy Wilson, vice president of worldwide sales at CTI Group, said: “The multi-national, multi-company coordination between Vodafone Iceland, Ericsson and CTI Group has delivered a scalable, revenue generating application for Vodafone Iceland’s next generation network, which I am confident will be of extraordinary value to Vodafone Iceland’s increasingly mobile workforce.” Ragnheiour Guomundsdóttir, head of product management and marketing at Vodafone Iceland, added that: “the selection of CTI Group’s hosted call recording solution, SmartRecord, was won against stiff competition. The rich functionality and technical innovations of SmartRecord, supported by an efficient, knowledgeable and responsive commercial and technical team at CTI Group was impressive and well received by our product management team.”

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Turkcell selects Progress for event processing Turkcell has revealed that it has gone live with its implementation of the Progress Apama Complex Event Processing platform, enabling it to offer real-time situation based promotion capabilities to customers. The solution will enable the operator to respond instantly to its mobile customers’ situations, providing them with customised offers based on more than 150 criteria and usage patterns including location and personal preferences. As a result, Turkcell expects to cut the time required to execute a marketing campaign in minutes, so that by January, it can analyse more than one million subscriber preferences per hour to develop relevant marketing campaigns. As Burak Sevilengul, chief marketing officer, Turkcell explained, the ability to innovate only becomes possible when knowing a customer and being able to truly personalise their service. "We need to satisfy all our customer’s needs, which means we need insight into their changing expectations and a way to communicate effectively to ensure broad awareness,” he said.

Volubill brings charging and policy to Cameroon Volubill has announced that 4G Africa AG, a Swiss company operating in sub Saharan Africa, has completed the first phase of a mobile 4G WiMAX network deployment in Cameroon including the implementation of its CONTROL-IT and CHARGE-IT solutions. The 4G Africa project operates an integrated subscriber management system containing AAA, service policy management and real-time convergent billing capability, based on Volubill’s commercial solution and self-developed front-end applications for CRM, customer self-care and point-of-sales. John Aalbers, CEO, Volubill said, Broadband penetration serves only 1% of the total population and without the copper infrastructure WiMAX is cheaper to roll out and provides greater efficiency for a developing region that is data hungry.

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Welcome to our regular Jobs column brought to you by Kineticom, sponsors of People News I have previously used this column to talk about the recruitment industry in general and discuss methods to improve recruitment effectiveness in the networking, OSS and BSS markets. Those are subjects that are dear to my heart but it's Jason Bandy dawned on me that many Vanilla Plus readers probably don't know too much about Kineticom and so in this edition, unashamedly, I would like to do some self promotion. I hope to ignite discussion and to develop some new commercial relationships. Kineticom is a specialist recruitment company. Our expertise is to quickly identify, assess and secure high quality talent for our clients within the Network Infrastructure, OSS and BSS arenas. My partner Rob Shaw and I have been recruiting within the telecoms world since the early 1990s and have built up a reputation for decency, deep industry knowledge and speed of delivery. We currently employ 16 people based in Buckinghamshire, UK. We provide permanent – retained and contingency – and contract resource to carriers, vendors and systems integrators throughout EMEA. I see our main strength as being as simple as the fact that we have learnt to ask the right questions. Experience, knowledge and a focus within key areas such as network infrastructure and OSS and BSS enables us to drill down, dig deep and get to the heart of an individual's DNA and an organisation’s culture. We are not typical because of that sectorspecific experience. We are not generalist technology recruiters and that makes us different. We are flexible and we have a huge impact on our clients’ performance and candidates’ careers. I'd like to explore how we might be able to help you and your organisation and encourage you to contact me. Jason Bandy, director, Kineticom Ltd. Jason.bandy@kineticom.co.uk Tel: +44 (0)845 370 2900 Mobile: +44 (0)7500 013084 www.kineticom.co.uk

Olaf Swantee Appointed CEO of Everything Everywhere

Olaf Swantee

Everything Everywhere, the merged business of France Telecom Orange and Deutsche Telekom in the UK, has appointed Olaf Swantee as chief executive officer. Swantee will take up his new job on 1 September and replace Tom Alexander who has resigned. The company stated Alexander has resigned both for personal reasons and to pursue other interests. Alexander will continue to advise the company and support Swantee in the transition, until the end of the year.

Alexander joined Orange in 2008 as CEO of the UK business. He became CEO of Everything Everywhere when the company was officially formed on 1 July 2010 following the merger of Orange UK and T-Mobile UK. “It’s been my privilege to serve Everything Everywhere these past twelve months, and Orange before that,” said Alexander. “I’m proud of what we’ve accomplished: we conducted a rapid integration of the new company, completing a companywide restructuring, and maintained good commercial momentum throughout, delivering record retention levels and growth on our contract customer base across both brands. There is never an easy time to leave a company that you care deeply for but, for personal reasons, I feel now is a good moment to step back. I am delighted to welcome Olaf into his new role. I’d like to thank my team and all the staff at Everything Everywhere for their great work and support, and to wish them all continuing success in the future.” Olaf Swantee, an economics graduate with an MBA from the Ecole Supérieure de Commerce de Paris – École des Affaires de Paris (ESCP-EAP), is currently France Telecom’s Executive Vice President, Operations in Europe (except France) and Sourcing. Prior to telecoms, Olaf had 17 years experience in the IT industry, holding senior leadership, sales and marketing positions with HP, Compaq and DEC in Europe and the United States. Since 2007, he has successfully transformed Orange throughout Europe. He was instrumental in the Orange UK turnaround and has been on the board of Everything Everywhere since its inception. He will relocate to London with his family. Swantee, previously executive vice president of European activities and sourcing for France Telecom Orange and board member of Everything Everywhere, added: “I’d like to pay tribute to Tom’s leadership, and I am looking forward to building on the successes that Everything Everywhere has already accomplished, and to taking on the challenge of moving the company even further ahead in the coming months and years.” Tim Höttges, chairman of Everything Everywhere’s board and chief financial officer of Deutsche Telekom, said: “Olaf Swantee has a deep knowledge of Everything Everywhere’s business and has been a director on the board of the company since its very beginning, and is ideally placed to provide both continuity and progression.” Gervais Pellissier, member of Everything Everywhere’s board, deputy CEO and CFO of France Telecom, said: “We would like to thank Tom Alexander for his significant accomplishments at Everything Everywhere and wish him well in the future.” Alexander’s departure has come as a surprise to the industry. He set up Virgin Mobile and floated it before taking a ‘career

VANILLAPLUS AUGUST/SEPTEMBER 2011

break’ in 2006 in which he indulged his passion for motor racing. He joined Orange two years later. Before the merger, Swantee was more senior to Alexander, running Orange's operations across Europe. He is currently France Telecom's executive vice-president. Some commentators have suggested that the parent companies had become frustrated over the financial performance of the business but the owners state that the forthcoming results will show Everything Everywhere had hit its targets. The change may simply be a case of Alexander wanting to return to his extensive garage but a sinister reading of the situation would be that France Telecom is looking to exert greater control of the business through placing one of its key executives in the senior position at the company. Richard Moat, CFO and deputy CEO of the business, and the former CEO of T-Mobile UK, will continue as Deutsche Telekom’s counterweight at the top of the company.

GSMA replaces Rob Conway with Anne Bouverot The GSMA has announced that Anne Bouverot from France Telecom Orange is to become the association’s new head. Bouverot was most recently executive vice president of mobile services for the Parisheadquartered operator and has served on the board of the GSMA for the past two years.

Anne Bouverot

Bouverot replaces long-standing CEO Rob Conway, who announced his resignation in June. The organisation’s chairman Franco Bernabè, the CEO of Telecom Italia, wants the GSMA to refocus on serving the interests of its operator members. Bouverot will not assume the label of CEO, instead taking the title of the GSMA’s Director General. The reason for this switch, says the GSMA, is because the association’s board and its chairman wanted the GSMA's new leader’s title to “fully reflect the GSMA’s role as an association representing the interests of its members.” Prior to her most recent role at Orange, Bouverot was responsible for international business development at the operator, and her achievements include the privatisation of Telkom Kenya, new mobile licences in Armenia and Tunisia, and partnerships in Portugal and UAE. Before moving to Orange, she led a 600-person business unit of Equant and was responsible for developing IT services for Equant’s multinational business customers. She began her career in telecoms as project manager for Telmex in Mexico in 1991. “I am deeply honoured by the trust placed in me by the GSMA Board. The GSMA has played an important role in the development of the mobile industry, uniting the world behind a standard technology and ensuring seamless and interoperable mobile services for billions of users globally,” commented Bouverot in a prepared statement. “We are now entering a new phase, where virtually everyone and everything is connected by mobile, and with many new challenges facing the industry. I am looking forward to leading the GSMA to help and support its operator members to face these challenges and continue their development.”

Tekelec appoints Douglas Suriano CTO

Tekelec has named Douglas Suriano as chief technology officer. Suriano will be responsible for product innovation, leadership in standards bodies and industry forums, and advocacy for mobile data solutions across Tekelec’s global customer base. He will retain his current responsibilities as vice president of engineering, which he has held since joining Tekelec in 2003. In his eight-year tenure, he and his team have developed Tekelec’s next-generation mobile broadband portfolio through organic growth and strategic acquisitions, while expanding market share of its voice and text solutions. “Doug’s passion for identifying and developing marketleading technology places him in the ideal position to drive our mobile broadband innovation,” said Ron de Lange, Tekelec’s president and CEO. “Doug has earned the respect of our customers and partners and will apply his experience and expertise to identify solutions to solve their core network challenges as they launch and scale their LTE and IMS networks.”

Amit Daniel joins cVidya

Amit Daniel

cVidya Networks has appointed Amit Daniel as executive vice president of marketing and business development. Daniel has over 17 years experience in senior marketing and commercial positions in the communications and telecoms industries worldwide and her responsibilities will include strategic marketing, product management and business development.

“We are delighted to welcome Amit Daniel to cVidya and are looking forward to the impact she will have on our company”, commented Alon Aginsky, President and CEO of cVidya Networks. “Amit has been responsible for various product offerings and roadmaps throughout their product lifecycle and brings rich market and product experiences from her previous executive positions to our organisation. We are confident that she will help us with our long term strategies as we enter the next stages of growth, namely, maintaining our leadership whilst entering new markets.” “I’m excited to be joining cVidya and to help expand the business with innovative strategies” said Amit Daniel. “With cVidya being the global leader of the revenue intelligence solutions space, our next steps are to maximise the experiences of our client base through generating new products, roadmaps and services to help them achieve their goals. At the same time we’ll be looking to increase cVidya’s market share and take our expertise into new areas. I’m confident that with my telecoms and market experiences and background, I will be able to help cVidya continue to grow and remain at the forefront of this domain.” Prior to joining cVidya, Daniel served as VP of marketing and business development for Starhome, a provider of roaming solutions and held various managerial roles in product management teams.

VANILLAPLUS AUGUST/SEPTEMBER 2011

VanillaPlus Hot List: August/September 2011 The Hot List below shows the companies informing us of recent contract wins or product deployments. If your contract is not listed here email the details to us now marked "Hot List" <editorial@vanillaplus.com> Vendor(s)

Client, Country

Product / Service (Duration & Value)

Deployed

Amdocs

Telenor Serbia

Deployment of Amdocs' OSS as the inventory and planning system to support the first phase of Telenor Serbia OSS transformation project

6.11

Clarity

Telekom Malaysia

Completion of its Network Inventory System (NIS) project to enable rapid and accurate deployment of new services

9.11

Convergys

Guyana Telephone & Telegraph

Deployment of Comverse ONE Billing & Active Customer Management with Comverse Mobile Internet, and Comverse HUB Voice & Messaging Value-Added Services (VAS), to power transformation to enable OPEX reduction

8.11

CSG International Tunisiana, Tunisia

CSG Interconnect billing and settlements solution to consolidate and manage all partner agreements from a single platform

8.11

CTI Group

SmartRecord call recording solution to enable recording of telephone conversations on next generation IP multimedia voice platform to help it meet regulatory, quality and legal demands

7.11

Evolving Systems Indosat Mobile, India

Dynamic SIM Allocation (DSA) solution that allows prepaid subscribers to choose tariff package when they activate their phone

6.11

Fortinet

SK Telecom, South Korea

FortiGate-3950B network security appliances to protect 24 million subscribers using 3G and 4G LTE services from malicious attacks

8.11

Gemalto

UniCredit, Slovakia

Optelio microprocessor-based contactless stickers for commercial mobile payment deployment for phones without contactless features

7.11

Giesecke & Devrient

Bell Mobility, Canada

SmartRoam platform to optimise over-the-air updates for centralised outbound roaming solution.

Interactive Intelligence

Jersey Telecom, UK

Replacement of contact centre equipment and telephone system with a new solution to link five offices across Jersey and Guernsey

8.11

Progress Software Turkcell, Turkey

Implementation of the Progress Apama Complex Event Processing (CEP) platform enabling real-time situation based promotion capabilities

6.11

Red Hat

Telstra, Australia

Extension of partnership to enable expanded choice for enterprise customers in the cloud. Telstra offers Red Hat Enterprise Linux as a guest operating system on its infrastructure cloud service.

8.11

Redknee

Telefónica, Spain

Pricing analysis and optimisation solution to enable in-depth profit analysis and forecasting data for residential and enterprise customers.

9.11

Telcordia

Chile

Selected to provide number portability for all the country's operators on behalf of the national Number Portability Committee

8.11

Vodafone, Iceland

7.11

NEWS IN BRIEF

Operator billing arrives in France, the UK, Germany and the US Boku, an online mobile payments enabler, has launched direct operator billing with French carriers Bouygues Telecom and SFR, a subsidiary of Vivendi, adding to existing direct billing with Orange France. The partnership offers an additional 32 million French customers the ability to pay for digital goods and services using only their existing wireless service account, with the charge appearing on their carrier bill. The agreement means nearly all mobile users in France will be covered by direct operator billing from Boku. The French moves are not alone. Earlier this month, Vodafone began rolling out direct operator billing for apps sold through the Android Market, allowing users to charge purchases direct to their phone bill. “Vodafone operator billing extends developers’ reach to the large number of app-buying customers who are unwilling or unable to use credit cards,” a Vodafone statement commented. “In some countries this can be more than 90% of the market.” The first operations to get operator billing for Android will be Vodafone UK and Vodafone Germany. The operator intends to extend the payment method to its global properties.

In the US, T-Mobile announced at the start of the month that it is soon to launch what it calls ‘direct carrier billing’ to enable users to make purchases that will appear on their phone bills. However, the service has attracted the attention of the Consumers Union, which has voiced fears that operator billing leaves customers unprotected from fraud or merchant errors. “Mobile payment products promise a new, convenient way to pay but consumers could end up losing money if something goes wrong with their transaction,” said Michelle Jun, a senior attorney with the Union. “Mobile payment services like the one being launched by T-Mobile could put consumers at risk and fail to provide the protections they deserve.” No such concerns have yet been aired in Europe and Boku emphasizes its security and ease of use. MovieStarPlanet is one merchant already using the service with Bouyges and SFR. “Purchasing … is now even easier with this partnership powering a safe, secure and convenient direct carrier billing option,” said the company’s CEO Claus Lykke Jensen. "User feedback and increased revenue clearly indicate how much people love the convenience of Boku to pay via their mobile number. This new partnership will extend that convenience to many more loyal gamers in France." Sponsored by:

VANILLAPLUS AUGUST/SEPTEMBER 2011

CSPs must move from simply addressing known revenue risks to attacking the unknowns of their operations Alon Aginsky is CEO and president of cVidya Networks, the provider of revenue intelligence solutions for telecom, media and entertainment service providers that he established 10 years ago. Prior to cVidya, Aginsky served as vice president of business development and business alliances at C. Mer Industries, where he was responsible for new ventures in telecoms customer care, billing, and network management solutions. Aginsky holds a BA in Business Administration from New York Technology University and also helps young startups grow and prosper. Here he shares his view of the new revenue intelligence challenges with VanillaPlus. VanillaPlus: Alon, cVidya has now been in the industry for 10 years, with over 150 global clients, including 20 of the largest operators in the world. How did you get here? Alon Aginsky: When I founded cVidya in 2001, I knew that we were entering into an industry that would keep growing and where customersâ&#x20AC;&#x2122; needs would keep evolving. Back then we saw businesses were trying to manage their value chains efficiently but were lacking the expertise to address these needs. Businesses were in need of products, solutions and consultants that could provide much needed support and whose benefit would far offset their cost.

VP: As operators offer more and more complex services and the value chain becomes more distributed, how has the revenue assurance challenge intensified? What specific challenges are CSPs looking to overcome right now?

â&#x2013;˛

Iâ&#x20AC;&#x2122;ve always had an entrepreneurial streak and I knew that communication service providers (CSPs), with their incredibly advanced and

diverse revenue channels, needed the ability to control these channels and prevent leakage. I wanted to create a business that would provide a win-win offering. My vision was to establish cVidya as a company that would enable businesses to achieve a high ROI from our solutions; that we would actually save the customer money through engaging us and that they would be capable to optimise and generate new profitable streams once revenues are assured. However first we needed to educate the market that such solutions were possible to implement and actually work.

VANILLAPLUS AUGUST/SEPTEMBER 2011

“Revenue assurance AA: Each operator tries to keep winning new and fraud used to be mostly reactive, focusing on the ‘known knowns’. While this approach proved itself as very effective resulting in significant financial recompense, its effect on preventing leakages was limited.”

business and retaining existing customers by offering advanced services or enhancements to existing ones. Each time this occurs, the value chain becomes more distributed and complex, and so the need for revenue intelligence solutions grows. Some of the major issues and challenges we’re addressing for operators today relate to business intelligence with regards to pricing analytics. Whether it’s for a customer threatening to leave unless they are offered a better package or service, or a large corporation looking to source new services, CSPs need to be able to ascertain instantly what price or services they need to offer in order to retain the profitable customers or win a lucrative contract. Pricing analytics across the board is a key issue for CSPs as they look for new sources of revenues that are not coming from new subscribers or service launches, but from innovative bundles and packages to attract existing and new users. The solutions that enable the operators to identify the impact on pricing and provide recommendations for tailored pricing per subscriber are key differentiators. Another challenge that CSPs face is internal fraud, which is fraud that occurs from within their own organisations. We did a poll last year and 85% of CSPs felt that internal fraud was a ‘growing concern’. Internal fraud can range from an employee fixing bills for their friends or family to large scale financial fraud. CSPs were not always in a position to catch these fraudsters and would rely on word of mouth or other tactics. Our solutions come with dashboards designed specifically for identifying these issues. VP: Where do you feel the Revenue Intelligence domain is heading over the next few years? AA: In the past revenue assurance (RA) and fraud used to be mostly reactive, focusing on the ‘known knowns’. While this approach proved itself as very effective resulting in significant financial recompense, its effect on preventing leakages was limited. In practice, the percentage of the recovery of detected leakage is far from being 100%, mainly due to commercial considerations that limited the amount of back billing. Hence the industry needed to become more proactive, and prevent the leakages. This is exactly the benefit of adopting and adapting well-established risk management methodologies into the RA and fraud world. We managed to set standards in the industry through our CTO’s leadership of the RISK concept in the TM Forum, incorporating Risk Management methodologies into its Revenue Intelligence solutions. Our solutions enable C Level management to deploy a top-down view of their business and proven revenue protection methods enabling them to benefit from clear strategic planning and ongoing processes to achieve the set targets.

VANILLAPLUS AUGUST/SEPTEMBER 2011

fraud solutions, mainly using one-off consulting services, but the requirement for the market is for ongoing consulting capabilities to support the proactive approach. cVidya is the first in the industry to embed risk management methodology into its solutions. We will be revolutionising the industry by enabling operators to easily identify targeted risks and know exactly what threats will arise. We will also be enabling the RA, fraud and pricing specialists to benefit from an easy adoption of this methodology in their day-to-day operations through wizards and built in support within the products. Another trend we will see increasing is fraud conducted through social media channels. Fraud is one of the major concerns of CSPs and fraudsters themselves will always try and be one step ahead of a company. The dramatic growth of social networks around the internet world has brought us to the understanding that the information and data accumulated within these networks can be highly beneficial to fraud investigation processes. With virtually everything going on in or around the internet, fraudsters and their peers also act within, and manipulate for their criminal intent, the surrounding social networks. Embedding social networks, like Facebook, as an integrated tool and source of information to the fraud management system is something that helps fraud investigators in their search for relevant and useful information to uncover new fraud scenarios and trends. VP: In terms of new business and delivery models – cloud computing seems to be top of mind, what is your perspective on how cloud computing will change our industry? AA: Yes, cloud computing is definitely one of the exciting technology and business model shifts in recent years. For the communications industry it has two main implications. The first implication is that service providers are themselves becoming cloud service providers. This allows them to move up the value chain to offer IT services – in order to reduce churn, increase ARPU and ultimately avoid becoming dumb pipes. Service providers who will thrive in this new era are those who will offer hundreds and even thousands of ever changing applications delivered with innovative pricing models and over a complex value chain. This is challenging from a number of aspects and monetisation in particular – namely billing for these services and preventing fraud and other revenue leakages. To address these issues, cVidya launched IRIS for Cloud Services earlier this year – a solution addressed at tackling the specific challenges that service providers offering cloud services face when they want to assure their cloud services margins. The second implication is that service providers are also becoming consumers of cloud services. We see more and more BSS/OSS applications starting to move to the cloud, and while cloud computing is still in its early adoption phase, its benefits – including fast time

▲

Currently, we see operators utilising consulting services when initially deploying the RA and

“With virtually everything going on in or around the internet, fraudsters and their peers also act within, and manipulate for their criminal intent, the surrounding social networks.”

to market and low affordable monthly pricing – are just too compelling to ignore. This is why last year we launched cVidyaCloud, our umbrella of on demand revenue intelligence applications, for service providers of all sizes. It is available over the web on a monthly subscription fee without the need to install hardware or software. VP: How does cVidya work with its customers to deploy solutions that generate rapid ROI and have an impact on their profits? AA: cVidya provides a complete solution from the operator’s perspective. We provide our IRIS offering together with consulting services which enables us to define the priorities with the operators and guarantee ROI for the different product deployments. The fact that we provide consulting together with supportive products and tools allows us to adjust the products to the needs of the operators more effectively in order to prevent leakage and identify revenue losses. We also ensure that our products are synced with each other. We enable complete knowledge sharing between the IRIS portfolio applications be they fraud, dealer management, margin analysis or revenue assurance. Customers are sometimes tempted to take cheap or low-cost solutions but then they often find themselves stuck with poor performance products, lacking the flexibility to address new challenges, and without the innovative features that they need or expect. We make sure that our products address all those needs whilst taking into account the ROI

that the client expects. Lastly, we ensure that the client knows that we’re here to stay. Although a project might come to an end, the relationship doesn’t. We enter into a long-term partnership so that the customer will know that we will be there to help their business grow and provide consultation and advice at each new stage along the way. We work closely and continuously with the customer to brainstorm and provide our expertise from other customers to all deployments. VP: What do you think makes a player stand out in the Revenue Intelligence domain? AA: One key ingredient, and something that cVidya is known for, is innovation. We were first in the market with revenue assurance and fraud solutions for 3G, data and IP services, rating and billing verification. We are currently developing and deploying, in partnership with our customers, a solution for the mobile money space that enables operators to tailor their revenue assurance solutions to fit the new value chain of mobile money. We are also penetrating other vertical markets such as utilities, M2M and televoting in which knowledge we have gained from the telecom, entertainment and media areas will be used to tailor solutions to these markets. In addition, a player stands out when they have a reputation for delivery excellence and a commitment to the successful ending of every project they engage in. VANILLAPLUS AUGUST/SEPTEMBER 2011

REVENUE MANAGEMENT

Data mining and business insight, why it makes sense They say information is power, but what kind of power? What's the best way to manage revenue and how does business insight help service providers ensure they've deployed their resources sufficiently to support a just-enough service model, asks Jonny Evans?

Brian Carroll: Operators can find a happy medium

Amos Sivan: Manage congestion without marginalising users

Things are changing for CSPs as their product lines become more complex and the costs they incur from supporting new services spirals out of relation to the revenues they generate. A forced reassessment is underway, explains Clarity chief product officer, Tony Kalcina: "The telecoms industry has been forced to reassess longstanding business models to fend off advances from heavyweight competitors, such as Apple and Google." James DeMarco, CTO of charging billing and customer care at Nokia Siemens Networks explains that historically: "Flat rate and unlimited offers have encouraged unpredictable user behaviour in network environments, effectively de-coupling the cost of service from its purchase price. This approach has led to foreseeable usage spikes as well as some unforeseen externalities for many mobile operators in particular."

VANILLAPLUS AUGUST/SEPTEMBER 2011

But service expectations are changing. Customers want broadband, and also want calls, and CSPs must find a way to balance user demand with infrastructure costs: they need information about usage patterns today in order to develop solutions for intelligent billing tomorrow. This information will help them develop services "good enough" for consumer needs. For Amos Sivan, CEO, FTS, One of the challenges operators face in delivering broadband as data traffic continues to grow is to manage network congestion without marginalising their subscribers and at the same time monetise network traffic, improve subscriber-facing activities and increase ROI in network capacity. InTune Networks CTO, John Dunne, explains existing networks "aren't dynamic enough to respond to unpredictable traffic." Carrier costs keep climbing but revenue doesn't keep up. In addition, "Services are closed and bundled tightly, so users cannot obtain services on-demand. Their financial systems and service creation systems are not linked in any way to the underlying infrastructure."

â&#x2013;˛

For many communications service providers (CSPs), data is scattered across multiple systems, making the right information hard to find and revenues tortuous to manage. "Data is often looked at from a technical perspective rather than a customer point of view," says Anssi Tauriainen from Aito Technologies.

The Google/Apple impact means carriers have lost control of the advertising dollar. "One solution is for content producers and communication service providers to create mutually beneficial business models based on shared value chains," Clarity's Kalcina adds. Arantech CEO, Brian Carroll, also believes intelligent and continuous management and monitoring should help providers find a happy medium between using customer information and maintaining the network by delivering an endless stream of business intelligence to all relevant departments. "The operator could extract data analysis of the quality and consumption of network services, broken down by service, subscriber and device," he explains. This data could be matched with intelligent billing systems designed to "match individual customer usage and to improve their overall experience," he says. Sivan adds: "By offering packages based on the service or application, service providers can increase revenues beyond anything that a flat rate usage policy can offer. The provider will be able to offer subscribers packages such as YouTube subscription, or online gaming subscription, or regular surfing and email subscription. Tauriainen from Aito Technologies agrees that intelligent data could enable operators "to focus their retention efforts only on 5% of customers bringing in 50% of voice minutes, or direct marketing activities to latest smartphone owners who are not yet using data services," for example. Segmenting the customer base in order to retain the most valuable customers. Tony Jackson, director of telecoms solution strategy at Convergys, thinks the same way. "Operators can now rely on intelligent systems, which ensure that compatible software billing systems are in place to meet the specific demands of each subscriber," he

says. Such systems enable operators to meet the demands of both prepaid and postpaid consumers in real-time. Perhaps service providers can also differentiate traffic on different criteria, such as quality of service, bandwidth allocation or application types. Randy Fuller, director of strategic management at policy management provider, Tekelec, thinks that's the case. "Operators would be in a position to make traffic adjustments based on usage, meet the demand for new applications and offer a level of service that meets with a subscriber's expectations," he remarks. This new arena sees traditional revenue management becoming inextricably correlated with network and policy management. The value generated from services has to be related to the cost of providing them and, better yet, allow for profit. The future? Dave Labuda, Founder and CEO, MATRIXX Software, sees it thus: "CSPs will use this intelligence to enable context-based pricing in which not everyone will be charged the same. This will give them the ability to better shape and influence the demand on their networks and platforms - for example charging higher rates during prime gaming hours or offering free Web browsing during hours when network utilisation is low." This new service environment is more complex than ever before, but has the potential to deliver the granularity of data that revenue management functions require. Operators, however, must face the challenge of identifying just how to extract the meaty revenue data they require from the murky soup of extraneous, non-integrated data they hold.

Dave Labuda: Not everyone will be charged the same

The telecoms industry has been forced to reassess longstanding business models to fend off advances from heavyweight competitors, such as Apple and Google.

VANILLAPLUS AUGUST/SEPTEMBER 2011

CUSTOMER EXPERIENCE MANAGEMENT

Operators are metamorphosing as the blinkers come off Many CSPs are finally wising up to the benefits of delivering a truly unique experience to subscribers and changing their shape to focus on rich customer experiences rather than a row of green lights in their network operations centres. Mark Dye reports. For most consumers the experience of dealing with their network provider tends to be a lovehate relationship but something of a necessary evil. That connection to the outside world is something most of us can’t do without so it’s amazing what we learn to live with. If I had a cent for every time a call had cut out on my previous Orange or Vodafone 3G network I would be rich by now. The point here is that CSPs need to be doing more to improve the customer experience and the good news is that most are trying, in many cases very hard. The bad news? Well, it’s that they’re not quite there yet. As Brian Carroll, chief executive officer of Arantech, points out: “As it stands, mobile operators are adept at attracting new customers, but after the point sale tend to fail in their duty as a customer-focused service provider.” That’s because the first time most mobile operators hear from their customers after the initial sale is when calls are made to the contact centre and yes, you’ve guessed it, invariably these are complaints.

Thankfully CSPs have begun to sit up, think about customer experience and the reams of data they have at their disposal to help with this. Peter Dykes, senior analyst, Networks at Informa Telecoms & Media, reminds us, the advantages of real-time interaction with customers have seen more than one billing vendor repackaging part of its online-charging offering as a real-time-messaging system. “In February 2009, Germany-based Orga Systems launched its customercommunications platform, which is essentially the messaging module of the company's online-charging platform,” he says.

Bob Hockman: Improving handovers could boost quality of experience

“The idea of real-

Orga Systems’ aim was to ensure customers knew they were approaching bandwidth usage caps and enhance things like family tariff plans by letting a main post-paid account holder know when prepaid account holders needed topping up.

time control over

“The idea of real-time control over an essentially prepaid account is, for the time being at least, garnering more attention than the ability to charge in real time,” says Dykes.

more attention

an essentially prepaid account is, for the time being at least, garnering than the ability to

▲

Of course, this is ironic, in a world where a key priority for operators is to reduce the number of in-bound calls because of financial drain

associated with running call centres. Historically this has left most playing reactively and attempting to win new customers rather than retaining them, says Carroll.

charge in real time”

VANILLAPLUS AUGUST/SEPTEMBER 2011

CUSTOMER EXPERIENCE MANAGEMENT

Patrick Booth: Operators must focus on the types of experience they want users to have

He notes other vendors who have reported similar demands, recalling a conversation he had with Highdeal, now owned by SAP, about using real-time systems for purposes other than charging.

different pieces of the network will reveal interoperability issues. Simply improving handovers between different network protocols could significantly boost overall quality of experience,” he adds.

“I think what will really revolutionise CRM is when PCRF/EF really comes into its own on the service offerings side. At present it is mainly being used for traffic management and as such, the amount of data required relating to the BSS domain, access network and the end-user device is fairly limited,” adds Dykes. “Yet once things like on-the-fly cross-bundling, upselling and all that shiny shiny stuff gets going however, the need for far more granular data will be that much greater and therefore available to areas such as marketing and customer relationship management.”

Neil Coleman, director of marketing, Actix, thinks that geo-located, real-time customer data could be the game changer in terms of CEM and CRM. Whether it comes from cell trace, probes or handset agents, he says, it provides a real-time feed of how a customer is interacting with the network, what services they access and the quality of experience they receive.

Dykes thinks that two of the biggest benefits to operators will be the to be the ability to take a more proactive approach to CRM with the availability of real-time data, and the ability to automate a far greater proportion of the CRM functions. Brian Carroll: Carriers adept at attracting new customers

“Operators will have to be careful however, when deciding how much and which parts of the CRM process to automate in order to avoid replicating some of the more negative aspects of IVR systems,” he adds. Patrick Booth, industry sales director at SAP UK and Ireland, feels marketing is increasingly being pulled by individual consumers rather than being pushed to a large group of people. “Organisations must focus on the types of experiences they want customers to have during every interaction,” he stresses.

Bob Hockman, vice president of product marketing at Empirix, says that once CSPs are able to visualise the customer experience, they can strategically enhance it. “Rather than simply over-provisioning and waiting for networks to clog, mobile providers can use service assurance analytics to effectively “This personalisation, pinpoint infrastructure investments,” he says.

although essential for

This could mean mapping of applications to

the future of network resources to reveal choke-points that

operators, is more of degrade quality, or where video is consistently performing poorly in a specific area,

a logical progression optimising that portion of the network to than a big-bang generate significant results. approach” “Validating communications events across 20

VANILLAPLUS AUGUST/SEPTEMBER 2011

“Geo-located customer experience data enables operators to stop focusing on their network plumbing and to start focusing on customers, devices and locations,” says Coleman. “When combined with existing billing, customer care trouble and marketing data it becomes a powerful tool for understanding both customer experience and customer demand. CSPs can then make investment, marketing and day to day management decisions based around what the impact to the customer is rather than a set of dry abstract KPIs.” Monica Zlotogorski, marketing manager of Openet, says that this personalisation, although essential for the future of operators seeking customer acquisition and retention, is more a logical progression than a big-bang approach. In her mind the era of multi-year transformational strategies is over because CSPs simply cannot afford them anymore. She believes personalisation sits around deploying new technologies that insulate the traditional back office from change to leverage those new investments and coordinate real-time business rules across network access types. “Centralised policy controls, charging mechanisms, and subscriber data management tools enable new business rules to be rapidly deployed – by operators and, increasingly, through self care portals,” she adds. “Tactical business initiatives, such as personalised subscriber controls, promotional offers, and even opt-in advertising, enable operators to deliver increasingly more personalised options, evolving capabilities toward a strategic solution that delivers a more enhanced customer experience.”

CUSTOMER EXPERIENCE

EXPERT OPINION:

How to close the customer experience gap Mobile operators need new approaches to close the gap between what their networks report and what their customers tell them, argues Neil Coleman Over the last two to three years, we have seen growing tensions between customer care and network operations teams in mobile operators. Customer care agents find themselves handling more and more customer complaints at the same time as the operations team report ‘all green’ network status.

The problem with being network centric

This problem has its origins in the exponential rise in mobile data, increased competition and industry deregulation. The result of this means that operators now face a perfect storm of increasing network and device complexity coupled with slowing revenue growth, rising subscriber acquisition costs and a lack of customer loyalty. Operators have been investing in Customer Experience Management (CEM) initiatives but these systems, with their focus on high level end to end monitoring, lack the granular detail to enable them to address the real causes of the problems especially in RAN that accounts for 20% of all customer churn. Mobile operators’ traditional approach for assuring customer experience has been network centric, with management, employees and outsourcers being measured on their ability to improve overall network KPIs. This network centric approach misses the voice of the customer. Operators lack hard data on the quality of experience they deliver to key customer segments at critical locations and also don’t have data on how their network supports the latest devices. Being network centric also means that operators struggle to: • focus sales and marketing campaigns where their network is a differentiator • target investments in network infrastructure (macro, femto and Wi-Fi) to deliver maximum benefit to key customers • prioritise in-house and outsourced resources on activities that have the greatest customer impact

Forget the network, focus on people and places

To close the customer experience gap requires operators to become customer centric, shifting their focus from network elements to people and places. Being customer centric means that operators should be able to answer fundamental questions like: • Where are my corporate customers when they’re not in the office, are they dropping calls and is it a location, network or a device specific problem? • Is my network capacity being consumed by rogue users or handsets? • Are the problems being reported by my customers specific to one location, one handset type or one service? To address these questions, operators need to invest in customer experience optimisation solutions. These systems compliment traditional network OSS and CEM systems by providing granular customer experience data, geo-located and segmented by customer and handset type. These systems allow operators to follow a customer centric approach by: • establishing customer experience KPIs to prioritise customer impacting activities • allowing customer experience data to be used to diagnose problems, target investment and design solutions • enabling key processes to focus on improving customer experience KPIs.

The benefits of customer centricity

To illustrate the benefits of customer centricity, an operator we have been working with spent a number of months trying to address an unusually high rate of dropped calls on a small cluster of sectors. It initially took a network centric approach, adjusting network configuration without success. Taking a customer centric approach, focusing on people and places, it quickly saw the drops originated at a bus station, where people, waiting for their rides home used their smartphones. Unfortunately the bus station was underneath a concrete railway bridge, meaning that changes to the macro network had little effect and that a local coverage solution was required.

Neil Coleman, director of marketing, Actix: It’s time to take a customer centric approach

“Operators have been investing in Customer Experience Management (CEM) initiatives but these systems, with their focus on high level end to end monitoring, lack the granular detail to enable them to address the real causes of the problems”

VANILLAPLUS AUGUST/SEPTEMBER 2011

UNIFIED APPLICATION PERFORMANCE MANAGEMENT

Operators must tidy up their toolboxes to improve application performance There are some brilliant tools on the market for fine tuning network performance. But they won’t work unless you carry out a ruthless decluttering, writes Nick Booth. Some mobile apps can make you feel you’re getting old – you find yourself staring at the screen trying to remember what you set out to do. Which isn’t great when the subscribers are generally young at heart – they’re fickle and want instant gratification. So these ‘mobile middle-aged moments’ aren’t a great advert for the network.

VANILLAPLUS AUGUST/SEPTEMBER 2011

“Most service assurance tools are designed to tackle individual service monitoring, mobile infrastructure monitoring or transport monitoring, but never all three at once,” he says. Many of these tools are extremely limited anyway, he says. What’s the point of a monitoring and measuring tools that only

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Mass defections could be fatal in the current market, according to Marc Lippe, the director of worldwide marketing at InfoVista, whose tools probe the service delivery chain and look for the blockages that are congesting the network.

One of the problems for network operators is the confusing number of tools on the market, says Lippe. Their proliferation makes the duty of perfecting the end-user experience even harder and more expensive.

covers one domain of their infrastructure, he asks. It’s not as if IP/MPLS, mobile packet core network, IP transport, backhaul, Radio Network or data centre activity are self contained units. Each has an impact on the other. As so often happens, insularity has let the software industry down again. Some software is tied to particular vendors and other cannot handle a variety of existing technologies. All of these factors make it near impossible for service providers to ensure end-to-end service quality. As a result, many service providers are consolidating their IT and OSS tools. One InfoVista customer had over 1,000 tools and recently ditched 800 of them. Despite the complexity of the task, service providers need to find a solution fast, or their subscribers won’t ever be enticed into using more valuable services. We have to speed up problem-solving, says Lippe, by identifying, analysing and troubleshooting network issues and bandwidth-hogging apps before the customers are affected. Similarly, service providers must have the ability to prioritise and accelerate troubleshooting with real-time collection and analysis of key network performance and service quality indicators from one end of the infrastructure to the other – all on the low budget that is typically devoted to network and service operational costs. How? Mobile operators must consolidate and align their support systems and processes. Adopt a unified service assurance approach and when this consolidation finally lets you see the wood from the trees, you can get down to addressing the next phase of the service delivery challenge. Standardise on one network and application performance assurance platform, says Lippe, or your data services and applications will never give each customer the performance their level of subscription merit. All domains, vendors, technology types and services, no matter how diverse, must be unified into one cohesive unit. Then you can start monitoring and reporting on each point

of the infrastructure, from data center to mobile packet core, as if it was one organ. “Understand the relationships between resources, the services they support and the respective performance indicators,” Lippe advises service providers. Only then can you get to the root causes of service degradation. Hopefully before the customers notice. Aricent uses SevOne’s management platform to fine tune Vodafone’s mobile network in the UK. At SevOne emphasis is on real time reporting and scalability, says Mike Miracle, SevOne’s SVP. The best way to ensure rapid response is to make the management information clear to the people responsible. That hasn’t always been the case in this industry, says Miracle. “Proactive notification and granular data is needed. But we try to present the information as clearly as possible and create well-understood baselines for response. Our system fires off alerts to network ops teams and they will know exactly what action they will need to take,” he says.

Mike Miracle: Operators need to cut the mean time to innocence

With responsibility for service delivery shared among a number of different vendors, the blame game helps no one. When a problem exists, everyone should be held guilty until they can prove their systems are working. Then faults would be identified more rapidly. “We need to cut the mean time to innocence,” quips Miracle. SevOne says it can answer the questions service providers need to know: How utilised were the links between remote and home offices? Did they get the bandwidth the carrier promised? Did the server respond in the allotted period of time? Did the application respond in the parameters that were established? Did the routers pass the packets within the acceptable ranges for latency and jitter? Meanwhile the customer doesn’t know or care if a problem is caused by the device, application, the network or the content. All they know is they can’t update Facebook. Another solution provider, Compuware, claims its intelligence is gathered from all points of the service delivery chain and can pinpoint the problem and by looking at the flows of data. “Every bite tells a story,” says Richard Stone, senior manager of mobile solutions at Compuware.

“When a problem exists, everyone should be held guilty until they can prove their systems are working. Then faults would be identified more rapidly. We need to cut the mean time to innocence”

VANILLAPLUS AUGUST/SEPTEMBER 2011

UNIFIED

PERFORMANCE

ASSURANCE

EXPERT OPINION:

End-to-end mobile service quality:

From data centre to cell tower

Whether it’s reliable, uninterrupted voice connectivity, or real-time access to content and data, smartphone and wireless PC users expect the utmost quality from their mobile operators. This is why ensuring high-quality, always available wireless voice and data services from one end of the network to the other – and back again – is a must, writes Marc Lippe.

Marc Lippe: director of worldwide corporate and field marketing at InfoVista

With every dropped call, dropped packet, instance of jitter or failed download, a mobile service provider risks losing subscribers and high-value business customers to the competition. But delivering that level of unquestionable, end-to-end service quality is easier said than done due to the complexity and cost of managing today’s mobile data infrastructure and the explosion of data traffic crossing it. An inundated router, a downed line or a crashed server can leave hundreds or thousands of subscribers without service, while leaving the service provider vulnerable to disgruntled customers, churn and lost revenue. For these reasons, mobile operators must be able to quickly identify network trouble spots and the effect of bandwidth-hogging applications— before customers are impacted. They must do so in an increasingly complex delivery environment that consists of data centre, IP/MPLS, Ethernet backhaul mobile packet core, legacy voice core, mixed-generation RAN and 4G technologies— from multiple equipment vendors, while keeping network and service operations costs as low as possible.

VANILLAPLUS AUGUST/SEPTEMBER 2011

All-IP transport architecture challenges The data traffic explosion has led operators to increasingly recognise the importance of IP/Ethernet technology as a cost-effective transport medium and place a significant amount of emphasis, effort and investment on the transport network as a network asset. This is best seen in the mobile backhaul domain where many mobile operators are using or deploying Carrier Ethernet. The all-IP network infrastructure provides the ease of deployment and bandwidth to deliver both packet-based voice and data services over a common transport backbone while reducing the operators’ growing infrastructure costs. But with the dawning of this all-IP network infrastructure, a host of management challenges have emerged. These include: • Providing the same quality of service/quality

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To overcome these critical performance, quality and cost concerns, mobile service providers must adopt a unified application and network performance assurance approach that will enable them to address the underlying challenges of mobile data service delivery, the management of the IP transport architecture and the proliferation of service assurance tools. A key aspect often overlooked is that the actual transport of that data is done by the underlying IP wireline infrastructure rather than the wireless network facilities. By bringing together the quality of experience (QoE) perspectives from these two domains, providers can comprehensively assure end-to-end quality.

Mobile data service delivery challenges Data services represent mobile service providers’ fastest growing revenue stream, accounting for up to 50% of growth compared with the fairly flat revenue growth from voice services. Simultaneously, the rapidly growing volume of bandwidth-intensive mobile data traffic has made it difficult for operators to ensure quality and availability on these data services. Service providers must be able to: • Differentiate themselves from competitors by assuring a quality end-user experience on data services and applications • Build trust with and retain high-value business customers, especially where service-level agreements are critical • Hold third-party application providers and internet service providers accountable for the quality of the applications travelling over the network

of experience that users are accustomed to receiving over legacy transport network technologies • Equipping transport engineering and operations groups with the same level of operational and engineering capabilities they had with TDM • Meeting the bandwidth demands of mobile data and application users without oversizing and overspending on network infrastructure • Monitoring performance and capacity across the entire mobile network infrastructure, including the backhaul network, regardless of its multi-generation, multi-vendor, multidomain composition The challenge of proliferating service assurance tools The majority of today’s service assurance tools are designed to tackle either per-subscriber service monitoring, mobile infrastructure monitoring or transport monitoring, but not all three at once. This has resulted in a proliferation of tools and made assuring the end-user experience an increasingly difficult and expensive proposition. Hence, IT departments have struggled to: • Manage down both capital and operational expenses • Employ a single, vendor-agnostic toolset that can address both service and network management requirements, including transport monitoring, from end to end. Delivering high-performance mobile data services Mobile service providers need to be equipped with the reporting capabilities they need to offer service level guarantees. For mobile service providers, the biggest market is the consumer market, and ensuring that services are always available and meet end-user quality expectations is critical to avoiding churn. But as business from wireless VPNs and machine-to-machine (M2M) offerings increase, mobile operators must also protect their high-value enterprise accounts by delivering the level of service these corporate customers are paying for and by providing their customers with customised dashboards depicting such compliance. On the other side of the coin, mobile operators have an obligation to their subscribers to ensure that contracted application partners are delivering content of the highest quality. Subscribers look to their mobile provider to troubleshoot and deal with quality issues, even if the problem originates from a third-party content provider. Further complicating quality assurance is that the infrastructure between the mobile

operator and its third-party content providers is typically a leased ISP connection that the operator has no control over. Application deep packet inspection (DPI) offerings will help mobile operators remotely monitor the performance of applications coming from content partners, as well as further sectionalise the views into TCP delays and actual application response delays. Mobile service providers will then be able to distinguish between ISP connectivity issues and poor remote-application performance. A single, integrated network, service and application service assurance solution will allow service providers’ IT departments to manage end-to-end mobile network and service quality in real time and assure the performance of data services and applications on a per subscriber basis, without the cost and delays associated with having to jump between OSS toolsets. Monitoring and reporting of every infrastructure entity along the service delivery path, from data centre to mobile packet core, to the IP/MPLS backbone, radio access network and the Ethernet backhaul, will dispense with the siloed approach of tools that can report on either network or service performance only.

“The majority of today’s service assurance tools are designed to tackle either persubscriber service monitoring, mobile infrastructure monitoring or transport monitoring, but not all three at once”

A unified service assurance solution is also to deliver direct business benefits, such as providing insight into new service opportunities, with a view into the types of applications each subscriber is using by offering DPI between the SGSN and GGSN nodes and in the data centre. This enables the service provider to not only more readily pinpoint problems but also understand subscriber activity and preferences. Thus, if the operator identifies a high level of requests for a specific application coming from the student area of a particular city, it can follow up by tailoring a product it can market to that segment and demographic. With this comprehensive and actionable visibility into the health of the network infrastructure and the services and applications traversing it, engineers and operations personnel can proactively ensure availability and consistent performance on the growing scope of bandwidth-hungry applications and services they deliver to customers, wherever those users may be. By immediately understanding the relationships between resources, the services they support and the respective performance indicators, they will be able proactively identify and focus on the network root causes of service degradation before customers are negatively impacted, dedicate bandwidth, and analyse and prioritise application traffic in a way that ensures a quality end-user experience.

VANILLAPLUS AUGUST/SEPTEMBER 2011

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Tango Telecom looks beyond policy Over the past few years, the penetration rate of smartphones has led to the belief that these devices would deliver higher ARPUs, greater profit margins and increased customer retention. To some extent, this has come true with mobile data revenues set to climb to US$314 billion this year, a 22.5% increase over 2010 and reaching US$552 billion by 2015, according to one market research firm(*), boosted by subscribers' ongoing appetite for smartphones and tablets. However, the proliferation of these smart devices brings challenges for the operator: smartphone driven costs are rising faster than ARPUs, margins are growing ever tighter and the gap has widened between capacity expenditure for future growth and data revenue growth. Both voice and messaging are commoditised services and their overall revenue contribution is declining due to bundles and the up-take of OTT voice/messaging services. This has prompted operators to review their mobile data strategy and the way they conduct their businesses. Operators are looking to tiered data plans as a way of offsetting the high cost of smartphone subsidies and of controlling data usage. In North America alone, most operators are offering some combination of data caps and throttled speeds. This re-evaluation of business models and tariff strategies is set to continue, resulting in innovative approaches to data service charging, tightly coupled with mechanisms which control usage. Taking such innovative approaches to monetise data services and harness associated revenues through the implementation of tightly integrated policy, charging and dynamic self-care solutions will be an important cornerstone for operators as they strive to ensure their place in the evolving communication value chain. The policy management market is still a maturing one, where early implementations tended to be more network and/or pain point specific (P2P etc). Current implementations are also relatively static, simply controlling which services are accessible to which customers based on their susbcribed plan. Operators are increasingly looking to policy control capabilities to deliver innovative services, based on a broader set of on-demand offerings, more customer self-service choices, and more flexible and dynamic pricing models based around cell

load and yield management inputs. These new services will drive interest in integrated policy and charging solutions, particularly in emerging markets that are primarily prepaid. As application bandwidth requirements continue to rise, operators are looking for better ways to monetise their existing capabilities, making one-size-fits-all pricing an unappealing option. By integrating policy control with charging, operators can offer intelligent pricing models, such as upselling temporary bandwidth prioritisation (turbo boost) to meet specific application requirements and encouraging data usage when cell load is low through discounts and promotions. For example, we can look at the case of two individuals subscribed to the same operator waiting for the train home from work during evening rush hour. Both have the same smartphone and are subscribed to the same data plan. They will have the same experience when they connect, which is the best that their operator can provide at that time.. Where things change is what they want to do with their smartphones over the next hour or so. One wants to check e-mail, update facebook, play a game and check out a couple of apps. The other is interested in watching a streaming HD movie, or perhaps downloading a movie to view on the train journey home. Clearly, one is asking a lot more of the network over the next hour than the other and the operator also has to consider the data users in the same cell during this busy commuting hour. The ability to up-sell temporary bandwidth prioritisation (turbo boost) on the fly or to offer a discount for deferred usage during location specific quiet periods will be an important part of this operatorâ&#x20AC;&#x2122;s integrated policy and charging management strategy. The challenge for operators is to truly monetise their network by creating a flexible and dynamic marketplace which maximises revenue while optimising the individual subscriberâ&#x20AC;&#x2122;s experience. This is the Holy Grail for operators.

Register online at www.vanillaplus.com to download this free Special Report from Tango Telecom and TRI in September 2011 (*)Gartner report "Forecast: Mobile Data Traffic and Revenue, Worldwide, 2010-2015"

VANILLAPLUS AUGUST/SEPTEMBER 2011

Strategic drivers for early to market mobile data policy

Ian Tidder

As mobile data consumption continues its exponential upward trajectory, it is not a question of IF but of WHAT type of policy management solutions are needed. Video traffic, the greatest bandwidth consumer, is doubling every 12 months and will exceed 60% of total data traffic by the end of 2014. Furthermore, Ovum Research predicts that over one billion people will use by then mobile broadband internet as their sole means of broadband access. Ian Tidder, CEO, Computaris explores the issues. Such an increase in data usage has a serious impact on every operators’ business as they cannot afford to let traffic flood their networks without ensuring that sustainable new revenue streams follow. The solution is to control bandwidth at customer level and monetise it by real-time integration with available customer data and BSS elements, enabling improved customer service. Moreover, as over-the-top (OTT) providers are already disrupting the communication landscape with myriad bandwidth-intensive applications and content, operators strive to exploit efficiently these opportunities without additional infrastructure investment and to create a mutually -beneficial value proposition for all parties involved: content providers, operators and users. Enhance traffic monetisation Policy encompasses traffic management and shaping, QoS enforcement and congestion control. Ideally a policy management solution should allow all these functions to be implemented gradually as needs arise. Policy rules, such as access control, bandwidth allocation, fair usage and traffic prioritisation, bring many benefits for both subscribers and operators: subscribers can easily control their usage of mobile data; operators can optimise existing network resources, increase transparency and visibility of subscribers’ usage behaviour and properly manage and monetise third party content and applications. Existing policy management solutions solve network congestion issues but are still broadly network-centric, revolving around imposing caps and limits to increase transparency. This may support increased consumption but does not necessarily generate new revenue streams. To monetise mobile data traffic better, operators must evolve towards subscriber-centric bandwidth management that provides the muchneeded interactivity in real-time so that customers can enjoy their mobile experience freely.

Maximise mobile data opportunity – quality counters churn Statistics show very clearly that managing content usage patterns should be a priority for all operators: 65% of mobile data traffic is usually generated by 10% of users. Therefore operators must strive to address each customer segment better, to increase their satisfaction and QoS and to enable a higher level of personalisation and user control. There are several options available from enabling advanced self-care functionalities to encouraging usage at off-peak hours, offering limited-time discounted price download promotions or other sophisticated application/data packages. Policy management solution of choice – fine-tuned tiered service revenue model When considering what type of policy solution is most suitable, it is imperative to keep in mind the growth trajectory projected for mobile broadband. To future proof it, the solution needs to be highly scalable and adaptable to evolving business needs. Also, it should have an established roadmap and evolution path towards 4G/LTE. Further recommendations would be to choose a subscriber-centric, full 3GPP-compliant solution, independent of the network infrastructure. To assure tomorrow’s success and to be prepared for the avalanche of new services and applications that are expected to come, operators should not procrastinate any further: they should implement this kind of policy management solution and create harmonious synergies between it and a real-time convergent charging solution. This will enable them to become active participants in the VAS value chain, by easily enabling and charging OTT services and by applying value-based service pricing strategies. Supported by such an infrastructure, operators will better adapt to changes and exploit all opportunities from the communications market.

To learn more about "Strategic drivers for early to market policy" then why not attend a FREE webinar hosted by VanillaPlus and presented by Computaris on: Date: 29th September 2011 Time: London 14.00pm Chairman: George Malim, VanillaPlus Editor Speakers: Corina Bulucea, Computaris Marketing and Alliances Director Topic: “Strategic drivers for early to market policy” Analyst: Ovum Register FREE today at www.vanillaplus.com 28

VANILLAPLUS AUGUST/SEPTEMBER 2011

VIDEO REVIEW

Telecom operators poised to tap market potential in M2M, Cloud and Enterprise Mobility services and leverage their expertise in business model transformation by delivering these capabilities as a service.

Fergus O’Reilly, Chief Solution Expert at SAP

Last month Fergus O’Reilly, Chief Solution Expert at SAP Consume to Cash and Dan Baker, Research Director of Technology Research Institute, sat down to discuss how telecom operators can be exemplary of business transformation across many different industries and even profit by helping other industries transform.

During his talk, Fergus took a closer look at how telecom operators are beginning to realize the large untapped market potential in M2M, Cloud and Enterprise Mobility services and are now in a prime position to leverage their experience and expertise in business model transformation by delivering these capabilities as a service to other industries. Although charging, billing, payment collections and revenue sharing for services delivered to mass volumes of customers are business processes which have long been applied by telecom operators, now we see many traditional product-based manufacturers also starting to offer value-added connected services. In today’s hyper-connected world, smart devices such as smartphones, tablets, connected cars, office equipment, industrial machinery and consumer electronics now come with Internet connectivity. This allows manufacturers to deliver and charge for

services directly to the end customer and over the entire life cycle of the product. This is often called the move into “XaaS” or “anything as a service.” So selling a product is no longer just a single revenue opportunity, instead it opens the door to recurring subscriptions and usagebased revenues over time. As Fergus highlights, SAP has a long experience in helping companies transform themselves and their industries. They understand when industries and business models transform then change needs to happen in people, processes and IT systems. As we learn here, their broad-based value management program – including the Consume to Cash set of business processes – can help customers structure and sequence their transformation and scale for the high volume of transactions generated by these new services, delivering incremental value at each step.

VANILLAPLUS AUGUST/SEPTEMBER 2011

VanillaPlus Video Talking Heads Reach a global audience with your interview streamed from www.vanillaplus.com

For more information contact: cherisse@vanillaplus.com Tel: +44 (0) 1732 897646

Upcoming Events

27-29 September, 2011 Paris, France www.broadbandworldforum.com

Policy Management & Control 12-14 September, 2011 Berlin, Germany www.iir-telecoms.com/event/ policymanagement

Carriers Ethernet World 27-29 September, 2011 London, UK www.terrapinn.com/2011/carriers-ethernet-world/

M2M Evolution Conference 13-15 September, 2011 Austin, Texas, USA http://m2m.tmcnet.com//conference/west-11/

CTIA Enterprise & Applications and M2M @ CTIA 11-13 October, 2011 San Diego, California, USA www.ctiaenterpriseandapplic ations.com www.m2mzone.com/events. fall11.asp

Interconnect & Termination Rates 19-22 September, 2011 Vienna, Austria www.interconnectionevent.com Number Portability 19-21 September, 2011 Madrid, Spain www.iir-telecoms/event/np

SDM & Data Warehousing 11-12 October, 2011 www.informatandm.com

Cloud Mobility Summit 20-21 September, 2011 Amsterdam, Netherlands www.gsacom.com/events/event _331.php4

Mobile Video Industry Summit 18-19 October, 2011 London, UK http://mobile-videosummit.com

Management World Africa 2011 20-21 September, 2011 Johannesburg, South Africa www.tmforum.org/ManagementWorldAfrica/8617/hom e.html

Mobile Apps and Devices 19 October, 2011 London, UK www.butlergroup.com

SDP Global Summit 20-22 September, 2011 Berlin, Germany www.sdpsummit.com

Comarch User Group 4-5 November, 2011 Brussels, Belgium http://usergroup.comarch.com

Customer Experience Management in Telecoms 26-29 September, 2011 Budapest, Hungary www.iqpc.com/Event.aspx?id= 501164 Broadband World Forum

Global Enterprise Mobility Forum 16-17 November, 2011 London, UK www.ebcg.biz/ebcg-business-events/18/globalenterprise-mobility-forum/

Actionable intelligence â&#x20AC;&#x201C; growth through control In a recent VanillaPlus interview, Sudeesh Yezhuvath, Chief Operating Officer of Subex, shared his views on the telecoms industry and how Subex helps CSPs achieve profitable growth through operational control. The need for actionable intelligence is important these days because of the evolution that the telecoms world is going through. It was a very high growth industry in its initial days, as is the case with most industries, and now it is maturing. Today, operators need intelligence on which they can move quickly and fix any problem that may arise and that is why actionable intelligence is critical.

and accurately the first time around is of extreme business importance because that helps them to reduce costs and improve customer satisfaction. Our contribution to this is our Revenue Operations Center offering. It has the ability to gather data from numerous large systems, churn through all that huge volume of data and spot any discrepancies. If there are any discrepancies, we also help the operator fix them.

The way we read the telecoms world today is that operators want assured outcomes because that reduces risk and risk represents cost. This is the primary reason why operators ask for managed services options. We offer the full gamut of managed services and we can work with operators in any type of engagement model they prefer. We can even outsource their entire operations, if need be, in domains related to us.

As a company we have had our share of difficult times but we have overcome that. That has been possible because we were always focused on customer satisfaction. We have observed changing market dynamics and we understand our customersâ&#x20AC;&#x2122; needs. As far as the industry is concerned, we will continue to see mergers & acquisitions and consolidation. Subex will continue to lead this as we have done in the past. We expect to be one of the leaders of the consolidation phase in our industry.

For operators, rolling out new services quickly

Sudeesh Yezhuvath

Watch the video at: www.vanillaplus.com /videolibrary/subex_ac hieving_growth_throug h_operational_control

VANILLAPLUS AUGUST/SEPTEMBER 2011

C L O C K I N G

O F F !

TalkTalk consistently bad if nothing else It wouldn’t be a normal month here at VanillaPlus without a carrier being criticised in some way for a lack of concern when it comes to its customers. This time around it’s Talk Talk that gets the customary slap around the face – in the form of a rather annoying fine for £3m from Ofcom. The crime? Billing thousands, well 65,000 to be precise, of its customers for services they did not receive. You can’t fault Talk Talk for consistency though. It continued to charge customers even after an initial telling off by the regulator.

The author Mark Dye, is associate editor of VanillaPlus.

Back in November, it had first been hauled over the coals following complaints from more than 1,000 customers.

Back in November, it had first been hauled over the coals following complaints from more than 1,000 customers. Yet despite Ofcom revealing this and waving a very pointed finger – think Wicked Witch of the West and you’re halfway there, TalkTalk and it’s subsidiary Tiscali, playfully continued to bill nearly 3,000 customers wrongly in the months that followed. While the regulator acknowledged that both TalkTalk and Tiscali UK had taken some important steps to comply with the rules, by making changes to customer records management systems, it fined the ISPs despite them having paid some £2.5m back to customers in the form of refunds and goodwill payments. While the level of the penalty was said to reflect the ‘seriousness of their breach of the rules’ and take into account steps already taken to compensate customers and change its modus operandi, it’s unlikely to bother TalkTalk too much considering Ofcom could have fined it 10% percent of its turnover. Last year the company posted a five-fold increase in pre-tax profits of £57m since its demerger from Carphone Warehouse, with revenues totalling £1.8bn. When you consider it also saw a rise in profits of £11m as a result of the integration of Tiscali, TalkTalk can consider itself lucky – unlike its customers and noncustomers. There’s been a lot of comment about how Ofcom has shown its teeth with the £3m fine. That’s true if the 65,000 customers where overcharged by a single pound each but what if the errors were

VANILLAPLUS AUGUST/SEPTEMBER 2011

larger and went for a long period? An overcharge of £10 for each per month for a year would total £7.8m – far in excess of the £2.5 TalkTalk compensated its customers and the £3m for the fine. Perhaps, rather than the watchdog showing its’ teeth TalkTalk was more on the receiving end of a gentle nibble. If you were thinking this little tale ended there you’d be wrong, there’s one more epic TalkTalk fail. This time the ISP has infuriated hundreds of local residents in Dumbarton, Scotland by committing a billing error – at least it’s consistent – that resulted in a local charity having its broadband connection cut off. The Gorsilaure Project, which runs an orphanage in the Democratic Republic of Congo, had its service suspended for nonpayment of a large invoice, which, you’ve guessed it, turns out to be another mistake. In its defence, TalkTalk has already offered £100 in compensation but this has been rejected out of hand by Sister Margaret Rose Scullion running the project, who believes lives at the African orphanage have been put at risk from the ISPs mistake. Now, hundreds of locals have joined in the fight and passed concerns on to their local MP in support of the Sister who was given inaccurate information when signing up for the connection with TalkTalk. With poor service – Ofcom says it’s the most complained about company in the telecoms sector – and in danger of being labelled a money grabbing joker, perhaps its about time the PR machine jumped in to save TalkTalk from itself and grab some headlines for the right reasons. After all, many VanillaPlus readers are able to sell them a highly scalable billing and customer care system for substantially less than the cost of the fines and reputational damage it is accruing.

BILLING & CHARGING SUPPLEMENT AUGUST / SEPTEMBER 2011 VOLUME 13 ISSUE 4 &

CHARGING

TALKING HEADS

FOR

THE

NEW

G E N E R AT I O N

CSP

SERVICES

▼

BILLING

Policy and charging convergence brings data monetisation clarity, says Amdocs' Guy Hilton

HYBRID BILLING

The best means of approach or the worst compromise

BILLING FOR MNCs Can carriers meet intricate cross-border requirements

OPERATOR INTERVIEW:

Orange Business Services UK chief says complex billing increases retention

PLUS!

Have you mastered the dance steps needed for enterprise communications? • Charging, policy and pricing • Let's get ready for LTE • Will operators walk the billing as a service walk or just talk the talk?

S U P P L E M E N T

C O N T E N T S

Billing charges back from the brink of boredom Just a few years ago billing was being looked upon as a boring topic. The thinking went that there wasn’t much innovation and so much exciting other activity was occurring as operators fought to gain a share of the mobile content market. The news is billing is back – and in a big way. George Malim, Editor: VanillaPlus

Now almost universally referred to as Billing & Charging, it takes account of the need to monetise far more than regular voice and data traffic. Critically, it’s also something that operators are uniquely good at. They can enable charging at great scale and provide great accuracy to the mass-market vendors of consumer content and applications. Their capability to do this sets them apart and the flexibility they can offer also makes them fundamental to the delivery of complex service bundles such as those for multinationals and those in the cloud computing market. Of course, operators continue to bill for themselves to their own customer bases. As Nick Booth points out on pS8 operators are innovating. Hybrid billing is being seen as a way to enable operators to educate prepaid users towards buying postpaid experiences. Perhaps the greatest turnaround in attitudes to billing lies in what it can enable for large, international businesses – or MNCs. Billing, or at least adjunct systems that extract usable data from existing billing systems, enables operators to make region-wide or even global offers to MNCs. That’s exciting because instead of winning business in a single western European market, an operator can take 14 European countries and enter markets in the Middle East or North Africa. As Matt Hooper points out on pS14, there are risks attendant to that. On the one hand it’s a great opportunity to win this premium class of business across multiple countries. On the other, it’s a fine chance to lose business in your domestic market. Only by being demonstrably better will operators win.

CONTENTS S3

Introduction and Contents

Billing News

S5 Talking Heads Guy Hilton, product marketing director, Amdocs S8 Hybrid Billing Nick Booth explores how hybrid billing educates prepaid users to postpaid behaviour S10 Dancing with the enterprise stars Monica Ricci says large enterprises represent a promising new dancing partner for operators S12 Real-time charging delivers real revenue Jaco Foure explains how real-time charging enables the two-sided business models that customer require S14 Billing for MNCs George Malim says the market’s massive but so are its demands S16 Pricing and Policy Control Miguel Carrero argues that linking charging to policy will win customers’ hearts, minds and money S18 Operator Interview: Mark Kenealy Orange Business Services UK and Ireland country manager explains the importance of billing to his operations

To do so they must have the agility to respond to the complex and varying demands of this customer base, instantly and effectively.

The consumer world mirrors this demanding nature. Users don’t want meaningless policy-originated caps imposed. They don’t want to be throttled and they want to buy services in a meaningful way. Yes, I’ll take five HD movies for a fixed sum per month. No, I don’t know if I want to pay for a 5GB data package. Consumers want to receive rich service propositions in a language they understand and they want to be billed or charged for them in a transparent, recognisable way. Users don’t want to get their calculator out to determine just how many megabytes they’ve consumed, but some will if operators persist in billing them in this archaic way.

TALKING HEADS

Guy Hilton, Amdocs

Billing & Charging is back on the agenda because it has now become relevant again. It underpins the business models of the new wave of services coming to market. Operators, because they know how to do this effectively, have many reasons to be cheerful. Enjoy the supplement, there’s no charge. George Malim Amdocs is the market leader in customer experience systems innovation. The company combines business and operational support systems, service delivery platforms, proven services, and deep industry expertise to enable service providers and their customers to do more in the connected world. Amdocs' offerings help service providers explore new business models, differentiate through personalised customer experiences, and streamline operations. Amdocs has over 19,000 employees and serves customers in more than 60 countries worldwide. For more information, visit Amdocs at www.amdocs.com.

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BILLING FOR MNCS

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MACH sees interconnect billing demand grow as operators sign up to Wholesale Service Bureau MACH has announced that seven new operators intend to outsource their interconnect billing and settlement functions to MACH’s Wholesale Service Bureau, indicating widening interest in its SaaS-based approach to key partner management functions. The operators, based in Africa and Europe, will benefit from improved cost containment and management of their wholesale interconnect margins as a result of outsourcing to the Wholesale Service Bureau. With the advent of new IP-based services and the intensification of wholesale competition, the traditional environment of voice interconnection is changing. While interconnect billing can typically generate between 30% and 60% of overall revenues for some wireline and wireless operators, it can also account for up to 30% of operating costs. As operators look to reduce the cost of ownership involved in maintaining in-house interconnect billing solutions, SaaS based solutions are looking increasingly attractive. “The nature of traditional interconnect billing, roaming and partner settlement is changing fast and we are seeing increasing interest from operators in Asia and Central and Latin America for our outsourced interconnect billing and partner management solution,” said Rich Grohol, chief commercial officer of MACH. “Africa and Europe are really leading the way at the moment, as operators in these regions look to benefit from the cost benefits and reduced complexity associated with this SaaS approach to interconnect billing. It is both logical and sensible to consider a managed service environment as the future for interconnect billing and partner management, in much the same way as this model has been considered the standard for the management of roaming traffic for many years.”

Elevate deploys Zuora cloud-based billing to expand services to 100,000 households Zuora, a subscription billing and commerce systems provider has announced that Elevate, a digital services provider with an array of IP and wireless residential services, is using Zuora’s subscription commerce platform to roll out subscription services across the US, Canada and Puerto Rico. Elevate offers hundreds of configurations of residential services tailored to the needs of each individual residential customer, including broadband service up to 10Mbps; IPbased TV and satellite TV service offered in cooperation with DirecTV and DISH Network; mobile and digital phone services; and a fully integrated suite of home security and automation services. Elevate selected the Zuora for Communications cloud-based billing and subscription management platform and was able to implement in just 60 days. The company can now roll out a

new range of services offerings on-thefly, enabling its business strategy and competitive differentiation, while helping the company scale its operations rapidly. Elevate has aggressive expansion plans to provide market coverage for more than 100,000 households in 22 markets by the end of 2012. To do so, Elevate is opening two to three offices every six to ten weeks. “Our business is based on the proposition of giving our customers exactly what they need for the best possible value, rather than limiting them to inflexible, impersonal service that many of us have come to expect from legacy service providers,” said Bryan Ferre, chief marketing officer, Elevate. "From the beginning, Zuora was part of our launch plans because of the clear competitive advantage it gives Elevate. If I want to launch 20 new products or packages tomorrow, I can. Our competitors with older on-premise technology simply cannot keep pace."

FTS wins Western European content and M2M billing deal with Leap system FTS has been chosen by a Western European content provider to implement its Leap Billing, a comprehensive end-to-end billing and customer care solution.

The implementation includes the system’s charging, billing, voucher management and customer management platforms. Leap Billing will enable the content provider to develop new revenue opportunities via enhanced customer service and support.

The service provider offers innovative content services combining Video on Demand (VoD) and Machine-to-Machine (M2M) communications. It needed a billing partner that is able to successfully support these new services as well as offer state-of-the-art billing solutions. By implementing FTS’ Leap Billing the service provider is now able to bill effectively for its content and provide a superior experience to customers, thus enabling it to more effectively monetise its network traffic.

“We are delighted to be working with this innovative service provider. By selecting Leap Billing, this provider has recognised FTS’ expertise in advanced content billing projects,” said Amos Sivan, CEO, FTS. “In addition to the new VoD services they are able to offer, Leap Billing allows new business practices to be instantly implemented and new services, bundles and promotions to be rolled out immediately, without involving costly billing integration projects. Thanks to Leap Billing, billing is no longer the traditional bottleneck for launching new services for our customers.”

Amos Sivan, CEO, FTS

Sponsored by:

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T A L K I N G

H E A D S

Flat rate data didn’t work, all you can eat bloated the consumer and starved the operator of revenue, and throttles, caps and additional charges have resulted in confusion and inefficiency. A new direction in data monetisation is required. Guy Hilton, director of product marketing for Revenue Management at Amdocs, tells VanillaPlus how the convergence of policy management and charging brings clarity to the market and has the potential to make sense of CSPs network infrastructure investments.

Policy and charging convergence brings data monetisation clarity VanillaPlus: Communication service providers (CSPs) are moving from unlimited packages in order to better monetise the data traffic they carry. Cap, charge or throttle: What do you think will be most successful?

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Guy Hilton: There’s a general consensus that unlimited data is not a sustainable business model in the long term. A lot of investment is going into network expansion or upgrades to 4G and LTE and unlimited plans don’t give operators an opportunity to make a return on investment easily or at all. Operators are pursuing a range of strategies to shift away from unlimited data and it’s important to

recognise that today data isn’t truly unlimited. In the US, for example, Sprint caps data at 5GB. Dan Hesse, the company’s chief executive, has been open about how he is approaching the market and commented that he had not ruled out metered pricing last October. Others take different approaches. TMobile USA throttles data speed down to EDGE or 2G levels – 100kbps or less – if customers exceed their allotted cap. Customers are notified via a free text message when they breach their monthly threshold and will be able to change their data plan. AT&T and Verizon Wireless offer tiered data pricing. That involves charging users based on the amount of data use. Verizon is to offer family

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T A L K I N G

“CSPs around the world already understand the need for policy and charging to be integrated in order to address the new world of data and the experiences customers demand”

H E A D S

data plans supporting multiple devices including smartphones and tablets that enable families to pool data entitlements so, in a family, data allowances can be shared across the users. Other operators simply offer tiered pricing based on volume, speed or a combination of the two. Regardless of the approach taken and the strategy chosen, one of the major challenges that needs to be overcome to be truly successful when instituting caps, charging or throttling back on speed, is to hand greater visibility and control to the end user. End users are not technically savvy and industry terms are not necessarily clear to them. Metrics such as 20Mbps or 2GB are broadly unfamiliar and users will want to be sure they are receiving what they paid for (especially in a speed based pricing model). From a subscriber perspective, pricing needs to be intuitive and simple to understand yet very advanced in the technology in the back office. To improve the customer experience and enable fast time to market we need to have charging and policy management working together. Policy management will give you a controlled network but not necessarily a profitable one. VP: In what way do you believe CSPs can exploit the information available at the network level to offer more sophisticated pricing schemes? GH: CSPs around the world already understand the need for policy and charging to be integrated in order to address the new world of data and the experiences customers demand. Now they can integrate information that resides in the network with subscriber data that typically resides in charging systems and enable the creation of new types of data plans.

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Integrated charging and policy which has network and subscriber based information coupled together enables CSPs to do more. It enables the context to be extracted from multiple networks to obtain network state, location and actual QoS with the BSS subscriber profile, usage pattern, monetary metering and product definition. That ties the customer profile and their entitlements to the service being delivered. Typical use cases would be: tiered services, data bundles, shared wallets and the enablement of data transparency. Those capabilities enable CSPs to support limitation based on data type so peer-to-peer or video traffic can be singled out to be throttled. They also enable packages to be split between family members, limitations to be based on content type and plans for peak and off-peak hours. VP: Most current systems don’t support the complexity of data monetisation requirements; have billing vendors recognised this trend emerging? GH: Combining charging and policy opens the doors to a whole new world of monetisation scenarios, but there is a need to close a capability gap. Most attempts to integrate existing charging and policy assets have not been very successful as these involved high levels of complexity. To that end, Amdocs has recently announced the acquisition of Bridgewater Systems, a policy management and network control solutions vendor for

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For instance, policy management applied at a network level enables quota tracking, the

management of congestion and the optimised routing of traffic. Typical use cases for policy management include enforcing fair usage policies, enabling congestion aware traffic shaping and traffic prioritisation. Those enable an operator to allow a user to access video at an off-peak time but to throttle back on video consumption in a train station during rush hour, for example. Equally, prime customers, such as enterprise employees or those that pay for a higher quality of service can be prioritised.

“There’s a job of education to be done which will enable the CSP to help customers select the most appropriate package fitting their data consumption habits”

mobile and convergent service providers. By combining the subscriber profile management and intelligent network control assets from Bridgewater with Amdocs’ holistic BSS customer view, Amdocs can offer preintegrated solutions that improves the customer experience, maximise data services revenues and enable CSPs to achieve fast time to market. Those are critical enablers for CSPs in the new world of data VP: For offering a family data plan, what will the service provider need to make sure of, in terms of billing system capabilities? GH: In shared and family plans specific subscribers have a data allowance that they can share across services and networks. Convergent charging needs to encompass the mobile services involved, cable TV, home connectivity and the devices involved. There is an extremely wide range of variables for charging mechanisms to take account of but the proposition should be compelling because it makes it easy for the head of the family to opt-in rather than having different plans with different providers. To enable that effectively – and it must be effective to deliver the simplicity advantages promised to the bill payer – the PCRF needs to be aware of the hierarchical quota of all family members. One family might want to give the children access to the bulk of the mobile data entitlement while the adults take the majority of the voice minutes. Another might apportion the SMS to the children but keep the mobile data capacity for the adults. These variables must be simply and flexibly addressed. In addition, other functions must be wrapped in to such propositions. Monetary metering and spending limits are often required at different levels for each family member and in total across the family. VP: But customers are still confused. How many HD movies can I view with a 5GB per month package, for example?

GH: Obviously operators need to go to market with plans that make sense to users. Nobody wants to attract call centre interactions demanding to know exactly whether all the entitlement was used. Equally, nobody wants to lose potential revenue by abruptly throttling bandwidth for a customer that may be prepared to pay extra to download additional video content after they have reached the cap. CSPs are already introducing usage calculators to help customers assess the data plan most appropriate to them. Some are empowering customers to apportion bandwidth to specific applications. For instance, an operator can enable a user to apportion a minimum amount of bandwidth to FaceTime video calls or a cap on video downloads. However, while these calculators are placed on CSP websites, most users do not access them and the average user doesn’t know how to calculate or predict their data usage. Therefore, there’s a job of education to be done which will enable the CSP to help customers select the most appropriate package fitting their data consumption habits. VP: Unlimited data didn’t work and tiered pricing isn’t intuitive so what’s the next step in data monetisation? GH: The next step in data monetisation is the evolution towards Value Based Pricing. For example movie or a games package has a clear value to a customer and they can buy into that rather than a volume of megabits per second. This means that packages will include all related pre requsities such as data quota and associated QoS to ensure that the optimal customer experience. So instead of wondering how much that Netflix movie is taking out of your data quota and whether or not you’d be able to watch the HD version of it, you’d get a package of five HD movies with right amount if data and QoS levels to have a optimal viewing experience. You won’t need to work out gigabits and megabits but rather know that you have five movies to watch and that would be it. VANILLAPLUS SUPPLEMENT AUGUST/SEPTEMBER 2011

“The reality is that most adjunct systems are significantly more advanced, streamlined and efficient than the legacy platforms they supplement”

Is a hybrid approach the best or worst compromise? Gordon Rawling: Prepaid and postpaid billing systems are both fairly blunt systems

The problem with hybrids is that it’s a slow process to create them. When you cross two breeds together, you don’t always get a stronger offspring. It can take generations for a genetic mutation to create a new species that’s better adapted to conditions and by that time the conditions may have changed anyway. Ovum Research says that though 63% of operators now offer some sort of hybrid model and almost half of all mobile operators say they need to make changes to their BSS in order to support changing prepaid strategies. Hybrid billing was identified as the future nearly a decade ago, says Gordon Rawling, Oracle’s senior marketing director for EMEA. Unfortunately, it still is the future. “Prepaid

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and postpaid billing systems are both fairly blunt systems,” he says, “and many thought that never the twain shall meet.” Still the industry pursues this elusive dream with some urgency, as operators need to squeeze more ARPU out of existing subscribers. But the challenge of bringing postpaid’s comprehensive sources of information to a transaction, and somehow upgrading the subscribers use of the phone with the immediacy of a prepaid deal is proving hard to meet. “Yes, we are getting closer to that point, but no one is actually doing it yet,” says Rawling. There is much to lose if they don’t get the balance right. The incremental gains created

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Anandan Jayaraman: Data from pre and postpaid systems is very different

The hybrid model is a great way to educate prepaid users to postpaid behaviour, say vendors. But are they clever enough to deliver this education, asks Nick Booth?

by fine-tuning the operator’s billing could be over shadowed by the losses created by a faulty hybrid. Don’t underestimate the scale of the task, says Anandan Jayaraman, chief marketing officer at Connectiva Systems. Operators know that if they get the operation wrong, they’ll lose money from their subscribers, rather than gain it. “They need to create a single view of the customer. But they’re finding that the data from pre and postpaid systems is very different,” says Jayaraman, “that’s going to cause leakage.” The prospect of a foundation of bad data, which could be exacerbated by badly configured ratings engines, could lead to painful losses. By the time the perfect hybrid is created the end game might have changed too. Once the rationale was to convert one type of user – a low ARPU prepaid sort – into a more lucrative postpaid consumer of data and video services. When Acision, for example, worked with Setar, a network operator based in the former Dutch colony of Aruba, to entice prepaid customers with services not usually offered to them, the rational was to convert them into contract subscribers, with the offer of a subsidised smartphone. The challenges in the developed world are different, argues Jonathan Pearson proposition marketing manager at Acision. These days the smartphone owner is likely to be a cross breed of pre and postpaid. “A Vodafone postpaid user, for example, might be offered a prepaid bundle of minutes for when they go abroad,” he says. Meanwhile, Connectiva cites its idealised hybrid customer to be a family in which a single plan caters for the parents on post paid contracts and children on pre paid for their respective minutes, SMS, data and video bundles.

Amdocs product marketing manager Guy Hilton sees hybrids giving a postpaid user the option of temporarily boosting their bandwidth. “The hybrid model is a great way to educate prepaid users to postpaid behaviour,” he says. It relies on the vendors educating themselves to support it, however.

“The incremental

The hybrid customer needs a hybrid system, but not one created by a convergence of the two traditional systems, argues Pearson. “Historically many converged charging systems failed, following massive overspends, long delays or failure to work,” he says.

overshadowed by the

gains created by fine-tuning the operator’s billing could be losses created by a faulty hybrid”

Instead a hybrid should take the form of an adjunct system – a new additional system, bolted on – which, he says, is a more practical approach and, thus far, has “a great track record”. Granted, this gives the operator another platform to maintain – with hardware and software that needs constant configuring – but it’s worth it. “The reality is that most adjunct systems are significantly more advanced, streamlined and efficient than the legacy platforms they supplement,” says Pearson. That adjunct does require integration into the central provisioning system, CRM, data warehouse, recharge systems and web portals. But this integration is a small job compared to creating a whole new prepaid or postpaid system, adds Pearson.

Jonathan Pearson: The smartphone owner is likely to be a cross breed of pre and postpaid

Mark Windle, director of product marketing at OpenCloud, thinks a new generation of cloud-supported hybrids could influence subscribers and increase margins by constantly exploiting price mechanisms. “Pricing-promotions help shape customer behaviour,” he says. “Operators can regain control of their marketing strategies, by offering price promotions that are not fixed into tariffs.” To a consumer, this sounds like mobile price plans are going to get even more confusing. Let’s hope they haven’t gene spliced the old billing systems and created a monster.

Guy Hilton: The hybrid model is a great way to educate prepaid users to postpaid behaviour

VANILLAPLUS SUPPLEMENT AUGUST/SEPTEMBER 2011

ENTERPRISE BILLING

EXPERT OPINION:

It’s time to dance with the enterprise stars For communications service providers (CSPs) dancing with capricious consumers who flit from partner to partner, increasingly spending their communications budget with a growing number of players, the large corporate and government sector offers a promising new dancing companion, with greater margins, more stability and a growing revenue opportunity. Monica Ricci explains the billing challenges.

Monica Ricci, CSG International: No two enterprise contracts are alike

Enterprises across the globe, driven by the ongoing convergence of communications and IT, increasingly seek new services and content while looking to reduce both costs and the administrative burden of managing these new services and technologies. For ongoing efficiency and consistency reasons, enterprises prefer a single consort to dance with; they do want to consolidate their services under a single CSP’s umbrella. However, the dances are getting harder to master: employees’ work patterns are evolving to rely increasingly on remote working and mobility, both elevating support demands. CSPs who successfully provide service to large corporations and governments acknowledge that BSS requirements for this sector differ from those needed to serve their retail customers. Enterprise billing – the process of calculating, generating and managing bills for large corporate or government contracts – involves more than just performing the same tasks in greater volumes; it adds complexity to the billing process that cannot be ignored if this lucrative segment is to be served successfully. Customer acquisition and order management The acquisition process requires the ultimate in flexibility to deliver the ultimate in complexity. The enterprise or government business will almost always seek communications contracts through a tender process, and the criteria by which the CSP wins the enterprise’s business is largely based upon the solution’s flexibility to meet each individual set of corporate requirements, packaged with unique, consolidated pricing and commercial terms. No two enterprise contracts are alike, either in terms of the package of services offered or in the commercial terms and conditions.

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The enterprise BSS must support the broadest range of telecoms and related services in a consolidated fashion. This includes traditional network-based services that provide the connectivity and bandwidth – to all of an enterprise’s locations, both physical and virtual; to all the enterprise’s employees who are increasingly mobile and utilise a growing number of connected devices; and to the growing volume of data, content and applications that are demanded by customers today. The network technologies required to connect an enterprise are numerous, and the CSP must provide Customer Premise Equipment (CPE), business applications, domain name registrations and email management, mobile connections and equipment, and increasingly, cloud services, desktop management, installation and IT outsourcing to accompany this connectivity and technology.

Filling the dance card: pricing and billing

This mixed bag of networks, devices, content and services requires every type of charging algorithm. While retail billing systems specialise in a particular line of business and particular charging algorithms, the enterprise billing system must enable all. T1/E1s are charged based upon service address, nodes and capacity between each node. CPE is usually contracted in bulk and charged at any point in time by the number of devices actually in use, and is associated with warranty periods and replacement cycles. Human resources for installation, support and management are based upon time and materials, and may frequently be associated with up-front or regular allotments

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Enterprise order management and provisioning must support every possible telecoms service in every possible combination. This in turn demands maximum flexibility and automation to

ensure accuracy throughout the process. Enterprise orders contain countless dependencies, usually including a number of third party providers and installation teams, and SLA monitoring and alarming is critical to ensure that this first step in the dance gets off on the right foot by meeting the customer’s needs.

that are subsequently decremented as services are delivered. And of course, many of the services consumed by the enterprise users have an associated usage-based charge, which increasingly can be derived from any number of parameters including bandwidth, QoS, or a value determined by the third party who provides content or applications. In the enterprise billing business, the single, consolidated billing system must support each of these pricing mechanisms, as well as overlaying higher-level contractual terms and discounts for the bundle.

May I cut in? Managing third parties

As the bundle of services delivered to the enterprise expands, the service provider increasingly relies upon third party partners to enable components of the package. These third parties can provide complementary services enabled by connectivity and bandwidth; content and applications to which they own the rights; network services in another geography which the service provider doesn’t serve; or infrastructure services. Managing the third parties in the value chain has implications across the BSS, including receiving usage records or service status from third party sources that must be interpreted, correlated, priced and billed; managing the purchase order process not only between service provider and customer, but between vendor and service provider; and determining revenue share and settlement amounts with these vendors for their services. Covering the entire dance floor: an enterprise-wide view Enterprises require billing-related features and data that surpass those delivered by a typical retail biller. These must include: • Providing consolidated and easily-understood views of the customer’s organisation structure (human resources), networks and geographies (physical infrastructure), financial relationships (billing and payment responsibility), and utilisation (usage data) • Enabling flexible, customised service bundles and price plans – typically negotiated exclusively with that customer • Supporting reporting, not only billing views, but on the other views that enterprise customers rely upon to monitor, manage and reconcile telecoms resources most efficiently. These views are often considered alternative hierarchies – payment hierarchies, legal hierarchies, pricing hierarchies – all related to different aspects of the corporate customer’s business, all important, and all defined differently. Today’s CSP, with an expanding footprint and a vision to serve the complex needs of enterprises,

manages a plethora of billing systems; it is not unheard of for a CSP to operate dozens of different billing systems across their business. When the case to replace one or all of these individual billers with an enterprise system cannot be made, a common approach is to implement a biller that consolidates billing data from the individual upstream processes. This consolidated biller acts as the system of record for end-to-end enterprise customer management and billing, and must: • Take feeds from the individual upstream billing systems, and rate them, re-rate them, or pass through the pre-rated charge directly to the consolidated invoice. • Apply the enterprise contract terms and propagate them across the service, organisation and billing hierarchies. • Generate invoices, statements and customised reporting for each enterprise level. • Support multi-language, multi-currency and multi-tax processing for multi-national customers. • Manage the billing reconciliation process, which for enterprises is extensive and lengthy. Managing disputes and adjustments is particularly complicated, as the enterprise biller must flow this information back to the legacy upstream billing systems. • Serve as the system of record for general ledger journal entries. • Support all of the processes within defined SLA terms, which can mean churning through some very high transaction volumes in very tight timeframes. Enterprise bills with hundreds of thousands of services and tens of millions of transactions are not uncommon, and need to be delivered by a certain date. • Support automated onboard of services and hierarchy changes. The enterprise customer himself usually maintains this data internally, and shares electronically via regular updates. If and when this process fails, the CSP must reconcile, and perform Moves, Adds and Changes as efficiently as possible to reduce operational costs and ensure accuracy. Just like professional ballroom dancers, CSPs who have mastered the complexity of enterprise billing make it look effortless. Deals struck at one meeting can be executed by the next; ongoing management of contracts and maintenance of hierarchies and agreements can be automated; invoices can be delivered in days and sliced and diced for reporting. The risks are high for those who don’t achieve a professional standard: 10% of enterprise customers have terminated a provider’s contract because of poor billing performance . And the performance that scores top marks in flexibility, throughput and automated management across the complex value chain will have them crying out for an encore.

“Enterprise billing involves more than just performing the same tasks in greater volumes; it adds complexity to the billing process that cannot be ignored if this lucrative segment is to be served successfully”

The author, Monica Ricci is director of product marketing at CSG International.

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REAL-TIME

CHARGING

EXPERT OPINION:

Real customer experience for all users requires real-time and delivers real revenue Real-time charging enables the real-time customer experiences the market demands. It also enables elimination of bill shock, allows for two-sided business models and improves the customer experience, writes Jaco Fourie.

Jaco Fourie: Plans not individual enough to capture mass market

“Many users on

The communications industry is moving more quickly today than ever before. But to understand where we are going, let’s look back to the 1990s, to understand where we are coming from. Mobile phone uptake was slow back then, it was expensive and as a result it became a product for the affluent few. It took important innovation to change this and our world has not been the same since. It was the beginning of a new business model, one that enabled differentiation and made it possible to sell mobile telephony in a new way. A way that was accessible to the mass market while at the same time manageable and profitable for operators. The business model was called prepaid. Real-time charging was the enabling technology that made it possible for the operator to control their credit exposure, while enabling the masses to get access to mobile telephony and control their spending.

volume packages Looking forward, we have started the journey towards the networked society, where

have difficulty everything that will benefit from being understanding how connected will be connected. We envision that much they have used monthly and operators have difficulties up-selling to users when they

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Today, the industry is buzzing with questions like: 1. How to prevent bill-shock? 2. How to monetise Over The Top (OTT) traffic? 3. How to address the low spenders? 4. How to improve customer experience? 5. How to grow mobile broadband subscriptions? The answer? It requires online data and realtime processes. It is no longer sufficient to use offline Support Systems (BSS/OSS) processes such as those primarily used by the operators to run their businesses today. They must transform to business-enabling online systems that are an essential part of an operator’s product offerings and their relationship with customers and partners. A transformation that will make it possible to, for example: 1. 2. 3. 4. 5.

Eliminate bill-shock Enable a two sided business model Create differentiated and segmented offers Empower sales and customer support staff Grow the business and profit

Let’s examine mobile broadband as an example of how the industry is changing. Currently we are experiencing a strong uptake of mobile broadband around the world. This means, once again, we have come to a point

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reach their limits”

by 2020 we will have 50 billion connected devices that will connect more or less every human being, improving their quality of life, the way we do business and enriching the societies we live in. This will create an immense amount of new opportunities for operators – new business models, new value chains and new demands from users on the quality of experience they receive.

We are once again seeing the need for deploying technology to create and support today and tomorrow’s opportunities.

where we need to rethink existing business models. Today’s approach is dominated by plans where the differentiation is primarily through differently sized megabyte or gigabyte bundles with varied monthly fees. These are not individual enough to capture the true mass market and address the needs of all the emerging segments. There are some who want or need to have access to everything and are more than happy to pay for a premium plan. Others will prefer paying only for selected services that fit their lifestyle. Many users on volume packages have difficulty understanding how much they have used monthly and operators have difficulties upselling to users when they reach their limits. So what happens if more targeted service offerings are introduced? How will users understand what their plans allow them to do? How will operators be able to create up-sell? Real-time for all users and all services will be the foundation for success. The key customer touch points can improve the customer experience when leveraging real-time information and real-time decisions: • Find – First of all, the offerings need to be easy to find. Not only in stores and on the street corner, but also on the web. This means promoting to your existing customers when they access your self-care portal or when they, in real-time, are notified about the cost for their current usage. • Get – Make finding the product and signing up for it smooth and enjoyable, both when it comes to getting the broadband connectivity, but also OTT services. This means making sure that you in real-time can offer the customer the ability to purchase or access a service if it is not included in their current plan. For example if a customer is exploring a service, you, in real-time, can present them with a relevant selection of offers. This is beneficial not only for them, but to you, and your OTT partners. • Setup – With real-time, seamless activation/delivery of the purchased service is enabled so that the user can instantly start using the service they have selected. There is no room here for the time consuming manual or off-line processes, users want instant results.

• Use – Services must be easy to use with a price that is easy to understand. Why should I pay for the data traffic if I’m already paying for the movie? Solving that question requires a two-sided business model with OTT players to ensure real-time access, delivery and quality control in order to deliver the right quality of experience. • Pay – It should be easy to pay for usage. Not only for the initial usage, but also when it comes to paying for additional offers as limits are reached or when users want to use new services. This requires real-time control of a users’ balance to manage credit risk and allow them to instantly purchase new services, thereby creating additional revenues.

“Real-time is fundamentally different from the traditional offline way of doing things and, when done correctly, is not only cost efficient to implement, but also to run in the long term”

• Get Help – It enhances the experience customers receive when using customer care channels if you are always able to present up to date information to users about their consumption, problems they have experienced and compensations they have received. • Modify – It creates the flexibility to easily modify the contract and service levels by adding or removing new services as their needs and demands change, all in real-time. Skeptics of real-time and online Business/ Operations Support Systems will say it is more expensive than the current offline systems, but how is it then possible to serve 76% (according to WCIS) of the global mobile users with real-time charging systems when you consider that most of these users are prepaid and consequently with that low ARPU users. Real-time is fundamentally different from the traditional offline way of doing things and when done correctly, with real-time and online thinking end-to-end, it is not only cost efficient to implement, but also to run in the long term. So is enabling a real-time experience for all users to earn real revenue growth a reality or a dream for operators today? The fact is that the technology exists, but that full deployment of its capabilities is still rather limited. For most operators a transformation of business processes and supporting systems is required and that is not a dream, but together with the right partner you avoid making it a nightmare.

The author, Jaco Fourie is director of business development and strategies at Ericsson.

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BILLING FOR MNCS

Billing for MNCs (multinational corporations) is complex because it involves cross-border activities, interconnects with third parties and a customer set that is as demanding as it is willing to pay. George Malim reports on one of the few growth opportunities operators have remaining in mature markets.

Multinational enterprises demand billing that is premium, agile and reflects their needs

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“Enterprise customers are often high value and highly profitable, industry commentators expect their importance and revenue potential to grow further,” says Greg Coogan, senior manager, Telecoms at Convergys. “But enterprise customers also represent a significant bottom line risk if things go wrong.” That’s a difficulty Matt Hooper, chief marketing officer at MDS, also identifies. “Service providers still struggle very much with the differences and the additional complexity of managing a business customer base in comparison to a consumer base,” he says. “Supporting an enterprise communications estate encompasses different currencies, dealing with [different national] reporting mechanisms and working with different people and local personnel.”

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“You have to deal with different countries and currencies and that requires a different layer to the billing systems. You have to take it one step higher than the billing system. The challenge for the operators is to take the billing system data and provide that consolidated view that enterprises demand.”

Addressing the MNC market is extremely attractive to operator groups. Winning pan-European business from a blue chip company has obvious attractions in terms of opportunity cost and adding high-value enterprise users to the customer base. However, such MNCs use their purchasing power to drive advantageous deals and expect their provider to give them with billing and usage data in the format of their choice. That poses a challenge for operator groups’ fragmented billing capabilities. For once, the operator isn’t to blame. Years of acquisition and mergers have led to countries having separate systems and initiatives to standardise in future generations are still underway. Nevertheless, operator groups have to move now to harness the opportunity.

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Emma Dunleavy, technical pre-sales manager at CTI Group, points out how different this market is to the consumer market. “One of the main differences is due to the complexity of trying to provide a consolidated view into the corporate,” she says. “You have to deal with different countries and currencies and that requires a different layer to the billing systems. You have to take it one step higher than the billing system. The challenge for the operators is to take the billing system data and provide that consolidated view that enterprises demand.” And enterprises are a demanding base to address. They’ve been promised by operators that single sourcing across their multi-national operations will deliver savings and efficiencies and they want to see them. “Enterprise customers – especially multinationals – expect cost transparency and a wide range of services that can accommodate a variety of needs, such as multi-currency, multi-taxation based billing, sophisticated, consolidated billing, reporting and analytics,” adds Coogan. “From basic voice and data for lower staff levels, to VIP services for executives, there are a range of complex, new productivity-enhancing, cost-reducing services on the horizon. In addition, service requirements are also susceptible to frequent change, for example, the addition of new employees, or promotions within an enterprise.” Dunleavy’s colleage at CTI Group, Amanda Pearson, product manager at the vendor, explains: “Corporates are pushing to know what their global spend is and their local operations in each country also want to know their spend defined by data and local currency,” she says. MNC customers don’t want only that type of separated view but also a comparative view so a parcel company, for example, can compare its operations in France with those in Germany. The mechanics of meeting those needs are at the heart of the challenge. “Key considerations on the retail billing side include the ability to bill one account with subscriptions in different countries and being able to separate charges,” explains Lucas Skoczkowski, CEO of Redknee. “On the wholesale side – profitability is contingent on ensuring accurate settlement between the international entities. Because group operators don’t have a global network, accurate settlement and reconciliation is vital for these types of packages.” Of course, in spite of the outward impression, operator groups do not have homogenous billing systems. That should be the ultimate aim, says Dunleavy, but an analytical layer that enables them to provide MNC customers with the billing data they require, presented in their format of choice, from the billing systems in operation, enables them to participate in this market. Hooper cites research from MDS that found plenty of room for operators to improve their enterprise customers’ levels of satisfaction. “80% to 90% of enterprise respondents were kind of satisfied with their service but that left only 20%

who are delighted with the service they get,” he says. “Issues include being tied in to contracts for services they no longer need and there not being enough transparency around billing.” Operators could be making a grave error if they don’t target this market, thinks Hooper. “MNCs are going through a rationalisation of the number of service providers they deal with,” he says. “They’re starting to deal with fewer and fewer suppliers but they put more and more business with them so it’s both a risk and an opportunity for operators. This market is one of the most, if not the most, profitable bases and is a growth opportunity for operators but they have got to be able to address it in a co-ordinated and transparent way. The agility you need to address this market is quite different to the consumer market so there is actually a strong business case for having a dedicated support infrastructure to address this market.” Operators shouldn’t just look at the MNC market as another subset of their customer base. “Simply put, operators must look to provide a premium service to a premium segment of the market,” says Coogan. “Operators must keep pace with changes and provide effective and timely management of services at competitive rates and tariffs. With customer demand for control and increasing complexity in service offerings, operators face a ‘control’ challenge in serving enterprise customers. To meet this challenge requires close analysis of enterprise customer expectations, behaviours and bills. To not meet this challenge means sacrificing one of the few high margin audiences available to mobile operators.” The challenge is simultaneously that appealing and that stark.

VANILLAPLUS SUPPLEMENT AUGUST/SEPTEMBER 2011

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PRICING & POLICY CONTROL

EXPERT OPINION:

Linking charging to policy to win customers’ hearts, minds and pocketbooks in an LTE world Price is the regulating mechanism of any market. The more complex the forces of supply and demand, the more sophisticated and fluid the pricing mechanism, and corresponding policy control in the network, needs to be. Miguel Carrero, director of actionable customer intelligence at HP, explains that in the age of LTE, pricing’s response needs to be more SNAPpy VanillaPlus: What’s the difference between billing and charging and policy control? Miguel Carrero: We talk about policy control, in addition to billing and charging, because with the advent of LTE, policy is becoming a key element in billing and charging. The nature of charging and policy are interlaced as we moved into more sophisticated services and networks. Miguel Carrero: Success depends on finding the sweet spot where price and demand intersect

It’s not like the old days of telephony when there was only one service, only a few ways of charging, such as prepaid or postpaid plans, and very poor customer segmentation. In those days, basic operator units were used for charging, such as time for voice or data volume for data services. When things got too complicated, flat rate pricing was used to hide complexity. But now the business logic is very different. It is based on many more variables. There are many more services, more devices, more networks – and naturally, many more types of customers. Vanilla billing is not enough in the age of LTE. VP: So pricing has to be far more responsive?

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VP: You’re saying that the market cannot find its level and evolve unless we have a better price model? Is that what policy control is about? MC: Yes, exactly. I’m saying that the finer grained pricing models we now need should be supported by a policy function. HP’s SNAP (subscriber network application policy) solution is designed to give this level of policy control. The idea is to create a foundation of business rules that can span multiple domains, such as different customers, networks, services or suppliers. So, with this policy foundation, a service provider will have a system to work out the charging in a more structured way because they will be able to segment customers by profile, device type, services used or time of day. Service providers need to know more. Who is the subscriber? Which device and service is he or she using? Is this usage putting the network in a congested state? Which network is the subscriber using? Is it a hotspot? Is it a congested LTE area? Is the subscriber experimenting with the service or is he consuming it 24x7, such as with peer-topeer traffic? With this information, service providers can charge accordingly. The point is, some people are prepared to pay for higher levels of service, so their potential payments are now being missed. On the other hand, some will not want to pay the same price for a lower grade of service, so their business will be lost as they feel they have been over-charged. Policy control allows service providers to give these customers what they want.

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MC: Yes. Consider all the many services a customer could be using: the many different devices, the many different networks; the many different times of day for usage, the different billing preferences and so on. Service providers are really looking at many different kinds of customers. In order to service all these customer types, service providers have to juggle their resources of bandwidth, storage, and processing power. So, from both sides of the equation, demand for services and supply of resources, we have very complex business parameters. The success of any market depends on using the price mechanism to find the sweet spot where price and demand intersect. We have very complex business logic and very complex parameters. A flat fixed price is not sophisticated enough for this model.

Today, the real challenge is how we address this sophisticated environment in a way that is comprehensible for the average user – who is not an expert in telecoms.

VP: Does LTE give you the opportunity to change things? MC: We’re putting massive emphasis on LTE – and this new network generation is intensifying the challenges … putting them on steroids, so to speak. With LTE we will have true mobile broadband for subscribers to consume very rich media services. Effectively, LTE will mobilise most of the content and services now on the internet. But LTE arrives on top of a previous multi-billion network investment – and the co-existence of networks makes the provision of services much more complicated. On the other hand, it might also empower the service providers with more information. Much of the success of the new policy approach will rely on the ability of the operators to charge and apply policy control in a more intelligent, sophisticated way. VP: Are operators missing out now because their billing is too simplistic? MC: The short answer is yes. Now the situation varies depending on which country you are in. In different geographies, billing is evolving in different ways. In North America, we relied on the flat fee mechanism to unlock mobile data consumption. But we’ve hit a barrier as subscribers are using smartphones to consume masses of bandwidth. So, service providers are moving to a more segmented network, away from flat fee pricing … in pursuit of a more fair approach in which customers pay in relation to how much value they get. But it’s still not sophisticated enough. VP: How much money is being lost as consumers are put off? And how much is lost by undercharging for people who hog all the bandwidth? MC: We don’t have those sorts of figures, but we do have analysis that tells us the delta of people who are cut off from the market and those others who would pay more for services they are now using.. Flat rates are hampering the market. It’s like trying to have a free market without the price mechanism. The good news is that we have the insights and the technology to make it work. First, service providers have to eliminate silos of information. After all, you only get an efficient market in conditions where there is perfect information available to buyers and sellers. In this case, the information not only needs to be available, but to

be fully understandable. For example, it does not help if my wife knows that she can use 200MB of data traffic for free with a surcharge over 200MB when a megabyte means nothing to her.

“Flat rates are

As buyers, subscribers want to know what services are available and how much they cost. Then they can make the decision whether it’s worth downloading that movie clip. As sellers, service providers will want to know all about the subscriber. Who they are, what they use, how long they will be using a service. HP SNAP aims to help make that information available in real time.

trying to have a

hampering the market. It’s like free market without the price mechanism”

If this information is obtained and used in real time, service providers need to manage network resources carefully to avoid negative impacts on service performance. At HP, we embrace the LTE opportunity with what we call Actionable Customer Intelligence. In ACI, we see three key steps. We need a single, holistic view of the subscriber, with all the information gathered together from different silos, such as different network elements, billing, customer care and OSS systems, into one cohesive unit. Second, we need to be able to analyse it in real time. I’m talking about big data real time analytics. And third, we need to be able to act! Once I, as the service provider, know which subscriber, application/service and network you are on, then I can begin to do something about the service I offer you. In many cases, acting on the analytics will manifest itself in a charging component, and so we see the interlaced nature of charging and policy. VP: What are the key challenges there? MC: We have commented on some of the technical challenges, and many of them are resolved. One of the remaining big challenges is that many operators and therefore many vendors still live in a siloed environment where customer, network and service data is in different systems and may be divided by network generations. These silos greatly impede the ability to offer the kinds of policy and charging options we’ve discussed. Also, many still see charging and policy as separate entities, which in our opinion is an archaic notion from the pre-LTE past. Only with an integrated, cohesive approach can service providers deliver the value that is being promised to the customer. We believe LTE is a major catalyst for pricing change and that there is progress. However the linking of Policy and Charging could be dramatically accelerated with cross-discipline approaches such as what HP SNAP provides.

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O P E R A T O R

I N T E R V I E W

Tailored billing drives customer retention, says Orange Business Services chief Mark Kenealy is UK and Ireland country manager for Orange Business Services. In contrast to typical operator country managers, very little of Kenealy’s operations actually involve the countries under his leadership. Instead, his purpose is to win multinational corporate business globally from firms headquartered within the UK and Ireland. He’s not trying to sell local connectivity and services, although that is a minority part of his business. He’s looking to deliver global services to the largest companies in the world, he tells George Malim. The aim for Kenealy is not simply to sell access to that core network but to bolt on a range of services, especially taking into account Orange Business Services’ footprint in emerging markets.

“We’ve got probably the biggest core network in the world,” he explains, “And, much as I’m UK managing director, 90% of the business is global. Typically I deal with companies like HSBC and Glaxo Smith Kline and help them as they expand into Asia and South America.” The aim for Kenealy is not simply to sell access to that core network but to bolt on a range of services, especially taking into account Orange Business Services’ footprint in emerging markets. “Although [core network] is commoditised in a lot of areas, in Africa, for example, it isn’t,” he adds. “We’re in a lot of major areas in Africa due to the France Telecom link. In emerging markets we’re strong in the more remote areas of Russia and all the ’Stans. We’re looking to partner to get into China and things are picking up in South America – Brazil is flying.” Kenealy, a former Computacenter executive who ran that company’s managed services, isn’t a traditional operator executive. “The reason I’m here is that I have more of a solutions, services and consulting background,” he explains. “Bolting on a set of solutions is previously something that France Telecom hadn’t been particularly successful at. Of course, it has been massively successful with wireless sales but Unified Communications and cloud and particularly now, the device explosion is playing into the drivers for people to have apps-led services. The market is playing into our hands.”

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Kenealy points out that Orange Business Services was early to identify the cloud opportunity and has been offering cloud services with partner EMC for two years. “Customers are already buying infrastructure from us so it’s easier for them to buy solutions from us as well,” he says. “We’re the first major telecoms organisation to have a fit for purpose cloud ready network. There are loads of opportunities coming up driven by cloud.” However, managing the back office and billing in particular for these types of complex, multinational services and customers is a significant challenge. “The billing relationship is hugely complex,” acknowledges Kenealy. “We have an office in Ireland that does all our billing and we have to do it in any language, in any currency, taking into account tax laws, VAT and the conversion rates a company might require. One customer might want everything expressed in US dollars another might want to be billed in a range of currencies.” “Simple things, like the UK putting up VAT to 20% from 17.5% cause all sorts of problems,” he adds. However, that brings opportunities. “The complexity does play into our hands because, when customers get billed in the form they want, it becomes a risk to change that. It is a risk to change their network provider and that means our retention rate is 90%.”