Controlling Content

Dr. Bhanu Sud discusses the difficulties facing cellular operators in charging for new services.

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By  Richard Agnew Published  September 27, 2004

|~|mobilecontent1.gif|~||~|Operators worldwide are turning their attention to securing and growing revenue streams from value added mobile services. Preparing for the rollout of these offerings, operators are looking at their infrastructure to ensure that it supports end-to-end delivery, extending past the network itself to areas such as customer service, supplier relationships and charging. Getting the whole process right from the outset is vital for success and operators are beginning to recognise that the best way to approach some of these key operational aspects is from a business perspective, rather than a traditional technical standpoint. One area in particular is billing. The business model determines the operator’s billing structure. An open market approach allows content providers to charge users directly through, for example, credit card subscriptions. Alternatively, a ‘walled garden’ approach delivers a consolidated bill for the user but raises issues of revenue sharing between the operator and content providers. The decision rests on what role the operator aims to play. If it chooses to position itself as a link in the delivery chain, charging content providers for access to the network, then the open market approach works. However, for more control over the service, a walled garden approach enables capture of content providers’ information but requires investment in systems for managing the increased volume and complexity of information gathered. Whether because of a lack of knowledge or funds, operators often skirt this key decision. Delivery of content is currently through a known platform, such as a Short Message Service (SMSC) or Multimedia Message Service Centre (MMSC). Operators will normally have a charging mechanism — such as LogicaCMG’s Pre-Delivery Service Agent (PSA) — for charging for these services. Operators can further consolidate their infrastructure by rating and charging SMS and MMS for both pre- and post-paid subscribers through the same system. However, as internet-style browsing, downloading and services become more commonplace, using increasingly sophisticated devices, charging becomes more complex. As a result, many operators offer ‘all you can eat’ tariffs — a defined data download at a set charge. However, when this level is exceeded it is no longer controlled in pre-delivery fashion. This is why mobile operators need to invest in an advanced charging architecture now, even though use of the more sophisticated data rating and charging may still be years away. Tighter subscription management is also vital for the mobile industry. When customers subscribe to services via SMS, the request is forwarded through the operator’s SMSC to the content provider who then assumes responsibility for service delivery, and the operator surrenders control. In this scenario, a customer may receive more — or less — than they expect and the more content providers they subscribe with, the worse it can get. This can lead to increased calls to customer support, who will not hold information on what was subscribed to and when. The likely end result? Customer churn. When this happens, the user’s mobile phone number is effectively quarantined, creating more problems when it is reallocated. The customer will automatically receive content they have not subscribed to, again causing dissatisfaction and perpetuating a vicious circle. Service Level Agreements (SLAs) can be measured and maintained if the operator controls the subscription. How else can operators guarantee that a SMS subscription offering five updates a day does just that? With complete control they can also, for example, be more proactive in advising their customers of service issues and simplify revenue settlement with the content providers. With the new and innovative mobile services coming to market, there is an increasing need for investment in payment and charging systems. Risk of customer churn and impact on the all-important bottom line will ensure that operators who invest in an efficient, flexible billing infrastructure will be the ones set up to reap the rewards. Dr. Bhanu Sud is the managing director and general manager for the Middle East and North Africa at LogicaCMG’s global telecoms division.||**||

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