By Kirill Rechter
August 27, 2014
Operators and carriers around the world are looking forward to the new revenue generating opportunities and increased network capacity of 4G networks.
4G networks will offer users more OTT and data-intensive value added services and smart applications that can work on an increasing range of devices. Using 4G networks, users will be able to make calls and send messages without depending on a specific service provider. More importantly, 4G will also offer users on-demand access to data-intensive services and applications involving streaming video, gaming, telematics, healthcare, M2M and much more. These services will be available to users without any boundaries or limitations at significantly higher speeds and at much lower costs than available today. As 4G adoption gains momentum, the world could soon turn into one big shop – where users can consume content directly from OTT providers by paying only the data costs to the telecom service provider and a nominal charge for the content purchased.
With the rollout of 4G networks, competition among communications service providers will certainly increase. At the same time, 4G will likely further commoditize voice and messaging services and even data services, making establishing competitive advantages for service providers increasingly challenging.
Service providers with modern BSS processes that support the evolving business models of the new 4G services as well as the changing expectations of customers will gain these important competitive advantages during 4G adoption. These two main factors relating to a service provider’s operations are the key to success with 4G networks and OTT services.
Simplifying complex revenue-sharing models: First, most of the new services enabled by 4G networks will rely on complex partnerships and revenue sharing schemes with third party application service providers. Service providers that can simplify access to these data-intensive 4G services and create attractive service packages will be in the position to increase revenue streams. Offering straightforward and easy-to-understand billing, despite the complexity of the revenue sharing models, will also help a service provider gain essential competitive advantages.
To achieve this, it is fundamental for a service provider to define and maintain holistic business processes that are supported by modern BSS systems. From product management to service delivery through billing, all operational workflows and BSS systems must be fully integrated across the entire organization in order to successfully incorporate new 4G and OTT into a service provider’s portfolio.
Operations that function with overlapping BSS systems with important service and customer data stored in unconnected databases and that rely on too many manual processes to complete processes will not be in the position to succeed with 4G. In such situations, service providers will be forced to make operational and business decisions based on the functional limitations of the BSS systems in place. As an example, defining revenue sharing agreements and creating service packages, which are essential to the success of offering 4G-enabled services, is difficult, if not impossible, if service information is defined and maintained in separate, disintegrated product catalogs.
Meeting changing customer expectations: The second factor very much relates to the first, although from the perspective of the customer. Customers have a constantly growing range of alternatives to satisfy their communications requirements. Today, competition among service providers of all types is strong and it will certainly increase with the rollout of 4G networks. Despite the complexity of these new services, customers have become accustomed to the simplicity of downloading applications to their smart phones and will expect no less from service providers for the access to and use of the new 4G-enabled and OTT services.
In parallel, there will likely be an increased uptake in data services at the initial launch of 4G networks, although these data services will soon get commoditized like many voice and messaging services have become today. This will further increase competition with differences among services providers that will diminish significantly in the eyes of customers.
However, a service provider can turn its operations into a competitive advantage and even gain market share. For a service provider, competitive advantages, especially in the 4G world, can be built on offering attractive services packages, automating service delivery, simplifying customer support, making billing transparent and so on.
To leverage operations as a competitive advantage, a service provider, again, must be in the position to establish holistic business processes that are supported by modern BSS systems. Inefficient operational workflows that rely on manual process will only encourage customers to consider their competitive alternatives.
The promise of 4G networks is clear. The service providers that position themselves with holistic business processes and modern BSS systems will be able build competitive advantages, attract customers and grow their businesses.
Kirill Rechter is the CEO of LogNet Billing. He is an expert in designing and implementing modern billing solutions for prominent telecommunications and utilities service providers worldwide.