3G: The Real-Time Mobile Opportunity

In light of traditional revenue and profit streams
being squeezed due to intense competition, Indian service providers need to undertake
innovative measures to maintain their position in the telecom ecosystem. The tariff
war has made return on new subscribers incremental. The high costs of 3G
spectrum and investments in roll-outs are further putting pressure on service
providers, to monetize services right and drive adoption. With nearly 95% of
mobile subscription being pre-paid, Service providers will need to look at
-hybrid’ pricing models for services to attract consumers and ensure stickiness.
The need today is off speed, scalability and solutions that will enable them to
differentiate their services and drive greater revenues. Real time charging
solutions can help deliver these.

 

Globally, we are already seeing postpaid
plans increasingly adding prepaid-style features like hybrid” plans. These offerings
provide more flexibility not just for consumers and business users, but also
for mobile operators and their business partners. To support hybrid plans and
enable a wider range of promotions for pre-paid and post-paid customers alike,
mobile operators in Central and Latin America (CALA) are upgrading their back
offices with real-time charging platforms. Unlike rigid legacy platforms,
real-time charging solutions are far more capable of supporting the wide range
of services enabled by 2.5G, 3G, fixed-mobile convergence and quadruple plays.
An important factor
in enabling new services is the ability to quickly change service offerings
based on the service provider’s approach to the market and on competitor’s
offerings. Service providers can react to these changes by reconfiguring their
service offerings or issuing promotions, bonuses and loyalty programs. As such,
it is very important to have the ability to create and modify rating plans and
promotions for new and existing services without incurring long development plans
or modifications to unrelated services.

 

In India,
some operators such as Aircel, Idea, Uninor and TTSL – among others are already
differentiating themselves with services that are real time and personalized
such as per-second billing and per-character SMS billing and other innovative
offers.

 

Real-time charging platforms make it easier and faster for mobile
operators to develop and launch promotions and other offers that drive
additional revenue, minimize churn and attract customers. Some real-world examples
include:

Per-second voice billing or per-character SMS charging to differentiate
against rivals whose legacy platforms can’t adapt to match these offers.
Charging by the character or second also can be an effective way to target
highly price-sensitive consumers.

 

Programs where customers earn loyalty points for using certain services
that can be redeemed from the operator, such as for a new phone, or from its
business partner, such as for concert tickets. This example illustrates the importance
of a real-time platform as it allows customers to get points updates almost
immediately rather than days or weeks later. This immediacy can encourage usage
because the customer knows he or she is only a few points away and decides to use
a service such as ringtone download one more time to get over the reward
threshold.

 

Hybrid family plans where parents pay for their teenagers’ postpaid
voice plan, while the teens have an add-on prepaid bucket” that they fund
themselves for services such as text messaging, ringtones and apps. This
offering can be effective for targeting price-sensitive parents who otherwise
wouldn’t consider providing their children with a phone.

 

Hybrid business plans where a company provides employees with a phone
that they can take home after work for personal use. During business hours, the
employer-paid postpaid plan covers calls and data services, but on evenings and
weekends, usage is deducted from the employee’s prepaid plan. This type of
hybrid plan can be attractive to companies that want to use mobile phones as a
perk to help attract and retain employees.

 

To ensure large scale adoption of 3G, Indian service providers will need
to build in flexible pricing for services.

 

The real-time charging proposition ultimately is about one thing:
control. For operators, that means greater control over the types of plans and
promotions they can offer.

 

For customers, real-time charging means more control over their wireless
spending and services. In the case of parents and employers, that can mean the
ability to set spending limits or restrict access to certain services, such as
no text messaging during school hours.

 

Control also can encourage or increase usage of services, even among
price-sensitive customers or those on a limited budget, because there’s less
risk of being surprised by a big bill. For example, with a real-time charging
platform, an operator could provide outbound and inbound roamers with alerts
when they’re approaching customer-set spending thresholds.

 

All of these industry initiatives, along with successful real-world
deployments, point to a bright future for mobile services based on real-time
charging. It’s an opportunity that few operators and customers can afford to
pass up.

 

In conclusion as the market becomes
less and less differentiated on headline prices and saturated in many parts of India, it is
important to build loyalty.  Not only with simple rewards programs but by
providing people with options to configure their services to work the way they
want them to, and which will cause them effort to re-configure with a
competitor.  Loyalty can also be built with companies in adjacent
business areas, for example grocery or electrical stores. Ironically, allowing
users to set usage limits can actually increase usage of services, particularly
new services, as it gives people confidence to use the service knowing that
they won’t be hit with unexpected high costs.  This can be particularly
useful for content and data services, not just for mobile but in the broadband/IMS
business as well.  Also for payments services, as these get introduced.

 

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