The move toward one

Telecoms Asia

By Kirill Rechter
March 17, 2011

Communications service providers offering more than one service is nothing new in Asia. For many years, cable operators have provided internet and local telephony services in addition to their core television content.

Fixed-line operators, especially alternative providers, are expanding their product offerings to include packaged fixed-line, mobile and internet services, while many mobile operators are repositioning themselves as communications service providers with product offerings that include broadband, content, VAS and even fixed-line telephony. These multiple service environments allow service providers to expand their revenue streams, subscriber base and market reach.

Although many service providers offer more than one communications service type, most multiple service environments in Asia are not yet fully integrated and often lack a customer-centric service strategy. Service providers throughout Asia commonly use separate billing systems and processes for each service type.

Tier one providers in developed countries are known to be running dozens of separate billing systems, while emerging service providers in developing countries often rely on ad-hoc billing processes and a combination of legacy systems.

Parallel billing systems might be appropriate under certain circumstances. In general, however, running more than one billing system creates significant IT overhead and operational complexity. Equally as important, when separate billing systems are used for each service type, offering cross-product packages and volume discounts is operationally difficult and often functionally not possible.

Service environments with numerous billing systems are often a natural consequence of rapid growth.

As a result, billing processes can easily become unstructured, creating an awkward situation in which a service provider can lose control of its revenue generation and customer management activities.

The appropriate time for a service provider to evaluate its billing processes and consider its options for a billing system is generally during the planning stages of a new service. Rolling out a new service with a holistic billing approach is essential. Merging multiple business lines into a unified billing process is ideal and often recommended. This of course is easier said than done.

There are four billing alternatives to consider when planning a new service.

Extend the functionality of a legacy system – the rollout of an additional service brings new billing workflows in terms of customer management, order management, service provisioning, rating and interaction with network resources. The functionality required to support the billing workflows of a new service can likely be added to most legacy systems, whether internally-developed or vendor-supplied. This alternative can provide a quick solution, although managing the business evolution of this development effort is a difficult and expensive process over the long term.

Implement a parallel system – for a service provider offering a traditional communications service and is committed an existing billing system, implementing a parallel billing system for a new service is a reasonable consideration. A service provider may not be ready to abandon an internally developed system even though its workflow processes are dedicated to a specific service type. To support a second service, such a service provider could deploy a parallel billing system to run side-by-side with the legacy system.

However, this situation has its limitations in that using two separate billing systems creates redundant maintenance work and adds to operational complexity. At the same time, two independent instances of customer databases, rating engines and product catalogs makes offering bundled service packages and cross-product discounts difficult.

Use a managed or SaaS billing service – a managed or software-as-a-service (SaaS)-based billing service is a good option for a service provider to expand its service offering without investing in additional network infrastructure. A managed/SaaS billing service removes the need to license, deploy and maintain a dedicated billing system for additional services. It also allows a service provider to focus on marketing the additional services and can even move the billing operations of its core service to the managed/SaaS billing service.

Deploy a replacement billing system – for a service provider with definite growth plans to fully embrace multiple service environments, replacing disparate billing systems and unifying billing processes should be strongly considered. By managing a fully functional billing system with a single customer database and centralized product catalog along with support for unified order management process and convergent rating capabilities, a service provider will be well positioned to succeed with multiple service offerings. Such a billing operation can facilitate increased revenues with advanced service packaging and discounting capabilities and reduce operational complexity significantly.

It is important to emphasize that a service provider that opts to replace its legacy systems should be prepared to allocate the resources for an involved deployment process.

Which option is best for a specific service provider depends on its particular growth plans and objectives. In any circumstance, it is best to achieve and maintain a holistic approach to billing operations that positions a service provider for future growth.

Kirill Rechter is the CEO of LogNet Billing.