Kallol Hazra details how a proper OSS/BSS strategy can help operators remain competitive in the market
What will be the impact of the recent MNP and 3G launches in India?
The recent MNP and 3G launches in India present an enormous opportunity to set and refine the business models and processes supporting 3G and MNP but particularly the former as it will be a major driver to faster adoption of new technological platforms.
The launch of 3G has been acknowledged to be a financial failure for many operators in the early part of this century. Indian service providers have an opportunity to learn from the mistakes of others keeping in mind that the underlying technology is secondary to the ability to monetize 3G services.
Perhaps the most important lesson to learn from previous operators’ mistakes is to ignore the customer experience at your peril. As Apple and the iPhone so amply demonstrated, if a user finds searching for and using content easy, they will in fact search for and use it. However, it’s important to note there is more to the customer experience than the use of the device. Customer management, using all channels, becomes even more critical when the complexity of a 3G device becomes apparent to a consumer.
With growing competition, there is a need to not only offer new and innovative services quickly, but to smartly package services to various and more diverse segment of the subscriber base. In addition, consumers will demand more personalization and more control. The challenge is to be sufficiently agile to keep tweaking service offerings quickly based on changing market dynamics.
As for MNP, the opportunity brings with it the challenge of potential churn. If subscribers leave the network, the operator will constantly be in the mode of subscriber acquisition directly impacting margins. To combat this vicious cycle, operators will need to identify the high value subscribers and offer them a differentiated service and experience to help encourage customer loyalty. The initial reports of MNP usage indicate a pent up frustration of user experience and all the major operators have already used up their MNP capacity in the first 20 days itself and are gearing up for additional capacity.
What are your initiatives to avoid bill shocks to customers?
Bill shock is a concern for many operators; not only do they risk losing disgruntled customers, but also revenue, though bad debt write-off and customers who are so afraid of racking up large bills that they generate no usage at all! Intec has recently launched the Intec Charging & Policy solution which brings together the control of policy management with the monetization of online charging to provide operators with a unique way to address such issues. By integrating the two, service providers can not only restrict customers’ usage at a certain threshold (using policy management), but they can provide options for the customer to keep spending if they wish. For example, a customer can be alerted that they are nearing their (self-selected) spend or download limit and provided with options to either buy more download allowance, have their bandwidth throttled for a lesser fee, or move to a more generous plan. This places the customer in control of their spending and enables further revenue to be derived that might otherwise have been -left on the table’.
What is your guidance to operators for handling complex content?
In the context of Business Support Systems, our advice would fundamentally be to look after both sides of the value chain. Typically, service providers have processes and systems in place to acquire and retain customers, and to do so as efficiently as possible. Customer management systems are sophisticated, self-service is increasingly common, and contact centres are well-established. In addition, the increasing ubiquity of smartphones (smartphone shipments are now poised to grow at a healthy CAGR of 18.1% during the period 2010-2015) the need for customer support for the sophisticated devices will only increase.
However, on the other side of the value chain, the story is very different. Content providers need to be nurtured just as customers do. The reality is attracting and retaining content providers results in a greater provision of better content. For a service provider, the content value chain is a virtuous circle – the operator’s assets attract content developers; the content developers deliver compelling content to the app store; and the abundance of great content attracts more subscribers and compels greater spend. As a result, the now increased size of the customer base and money spent draws more content developers, and so the circle continues.
In order to attract and retain content partners, service providers have a number of assets they can bring to bear. These include consumer information and customer intimacy, as well as the billing and payments options they can offer, and their expertise in customer care. Content partner management systems facilitate the monetization of these assets, while minimising the cost of managing an increasingly large number of partners among increasingly complex content settlement needs.
What are the latest telecom trends in markets such as India, Brazil, China, Africa and the Middle East?
In India, the relatively late adoption of 3G and MNP are actually providing opportunity to -leapfrog’ the global industry. Policy management has already been adopted by many operators, at least as point solutions, solving a particular problem, using to restrict data usage. We believe that this -toe in the water’ will lead to a second phase for such solutions, whereby control is handed to the customer, and policy management is integrated with online charging so that policy management does not imply restrictions, but rather revenue opportunities. In our discussions with analysts, they have indicated that policy will need to be integrated with charging to remain competitive, and that the lack of scalability of the current wave of policy deployments will become a major pain point, driving a new wave of replacements. In India, of course, with massive subscriber numbers already, scalability will be a top priority.
In addition, the move to real-time systems has underpinned many of the global architectural trends of the last year, and Intec believes this will continue into 2011. We have also seen a move towards -best of suite’ rather than -best of breed’ solutions. In many cases this trend will be circumvented by the large systems integrators developing their own -stacks’ that embed -best of breed’ components into a single suite, procured from one vendor. Multiple systems integrators are taking this approach as well and this has led to a degree of homogeneity, limiting operators’ choice, but on the plus side the competition has kept prices relatively low.
Another trend, globally as well as in India, is the emergence of the multiply-connected subscriber. Subscribers often have more than one connected wireless device. In many parts of the world, penetration rates have exceeded 100 percent due to each user having a smartphone , a data dongle and now, in increasing numbers, a connected tablet device. In other parts of the world, and in India, consumers will purchase a second (or third, fourth, fifth) prepaid SIM card – with proliferation of multi-SIM handsets – rather than top up the first one as it is depleted, in order to secure the best possible prices and offers. Today’s networks and BSS solutions must cope with this complex connectivity, and with the -internet of everything’ that brings -unmanned devices,’ or machine-to-machine connections, online as well, there are growing challenges to support and monetize these services.
And finally, the recognition of the importance of content partners will not only revise the BSS components to include content partner management, but will also mean new business models and structures. For example, CSG/Intec is seeing a rise in the influence that marketing has in BSS purchasing decisions, because there is increasing recognition that BSS is critical for quickly offering innovative new products and services.
What are your hiring, expansion and investment plans in markets such as India, Brazil, China, Africa and the Middle East?
For competitive and disclosure reasons, we’re not able to comment on future strategies beyond acknowledging that India, Brazil, China, Africa and the Middle East are key markets for CSG and Intec. We’ll continue to appropriately and aggressively support the unique needs of each market with our growing portfolio of solutions.
What are the new products in the offing?
Intec recently introduced the availability of Intec Charging and Policy, a solution designed expressly for the dynamic requirements of real-time charging and policy management to support voice, data and content transactions for all types of next-generation mobile networks. The solution is delivered in a 3GPP compliant architecture on a low-cost, scalable Linux x86 hardware platform, and enables the integrated functions that CSPs need to deliver and monetize the breadth of voice and data services that today’s subscribers demand.
Leveraging our extensive experience in real-time charging, the solution combines the most critical charging and policy-centric capabilities in one place. This includes support for:
Â· “Bill Shock” management, monitoring roaming subscribers and other users in real-time and alerting them when usage for a particular service has reached a threshold
Â· Prepaid data allowance management, extending the familiar features of prepaid voice to the most compelling data services today
Â· “Turbo Boost” options, allowing a subscriber to increase his bandwidth or quality of service temporarily for a specific transaction or for a limited period of time
Â· Sliding Quality of Service, whereby the user’s bandwidth varies during the billing period as his aggregate consumption crosses certain thresholds or caps
Â· Volume Allowance, with the subscriber paying a fixed rate for data consumption to a cap, and then an incremental amount per additional unit during the billing period
Â· Location-Based Awareness support allowing the subscriber to select the location for newest services for best pricing offers
Â· Corporate Policy Control, which extends controls for bandwidth, quality of service and usage allowances and restrictions across complex organizational hierarchies
Â· Parental Controls, which put the same capabilities into the hands of parents within family hierarchies.
How superior are your products as compared with competition?
In broad terms, our product line offers the overall advantage of enabling service providers to manage their revenue streams from network to bill. Based on the Total Service Mediation framework, customers leverage our Wholesale Business Management Solution and Singl.eView charging and billing system, for a complete suite of BSS products. We deliver scalability and proven performance across multiple different business models in more than 60 of the world’s leading telecom companies. But it’s more than just our products that provide our customers with a competitive advantage. As the second-largest BSS provider in the world, our people are uniquely adept at delivering the peace of mind customers demand as each is backed by a global, world-class professional services implementation and support team.
What are the demands of your carrier and enterprise customers?
In India, the overall telco market is shifting to focus on attracting high-value customers. As a result, OSS/BSS is now being seen as a critical component to the success of each operator as they fight to stand apart from the competition. Operators not only need to offer new innovative services that are reliable and cost effective, but they must do so quickly. It is no longer enough to offer simple prepaid services using an IN convergent charging and policy management have seen significant growth worldwide.
In addition, the growing demand for value added services from new age consumers is also prompting operators to look for competitive advantage through our strategic OSS/BSS offerings. What is unique to the market structure of India is the intensity of competition driving customer acquisition that has forced operators to outsource their operations. Participants have therefore operated in a more collaborative mindset forming consortia and business partnerships with otherwise competitive organizations depending on the desired impact of the solution or dynamics of competition.
Our customers also demand OSS and BSS capabilities in order to address new revenue models. From real-time charging and policy to the multiply-connected subscriber; convergence and LTE to the growing importance of machine-to-machine( M2M) communications each needs BSS to be successful. For instance, customers are demanding real-time processing where previously this was a nice-to-have. They also need methods to address charging how to charge, when to charge, and who to charge, with multi-sided and ad-supported business models. Scalability is also a critical component. Cisco recently forecast global mobile data traffic will surge 26-fold, reaching 75 Exabytes in 2015 and this huge increase in traffic volumes will present challenges to both application scalability and data management from storage to analytics. This is particularly relevant in the Indian market, where the demand for data is exploding given the aggressive rollout of 3G services, coupled with the a continued increase in subscriber numbers. And finally, of course, all of this has to be achieved at lower and lower cost.