Spearheaded by the arrival of real-time billing systems, billing is now a dynamic force with strategic implications and major repercussions for operators worldwide. Operators and subscribers in emerging markets, including those in the Asia-Pacific region, are among those enjoying the powerful benefits of real-time billing. Haim Kantor, Associate Vice President of the Real-time billing division of Comverse sets the scene.

New revenue opportunities

The development of next-generation billing can be attributed to several factors. In the current age of instant gratification subscribers are attracted to the availability of new data services that offer instant information, instant entertainment, instant communication, and instant purchases. To complete the circle, however, subscribers need to know instantaneously the status of their account and the cost of such services – features that real-time billing provides.

Secondly, promotions and discounts are becoming increasingly popular tools for stimulating additional mobile usage, particularly in the prepaid world. However, this can be accomplished only if the billing system is dynamic, flexible and able to react without delay.

"The potential for additional revenues is substantial if operators can seize the moment via real-time billing systems"

Thirdly, operators can seize the opportunity of impulse buying, which is critically dependent on prompt action. For example, if subscribers purchase a musical ringtone by a specific artist, there is a good chance they might buy a music video from that same artist, particularly if they receive a brief trailer or are offered a discount immediately. The potential for additional revenues is substantial if operators can “seize the moment” via real-time billing systems.

Cost-cutting tool

With operators looking to lower the risk of bad debt among subscribers, real-time billing is a godsend. While banks have long recognised the need for real-time purchase authorisation and charging to a credit card account, mobile providers for the first time can operate based on managed risk principles rather than on trust.

And with revenue leakage proving to be more damaging than ever, real-time billing can reduce the extent of losses, since circuitous CDR-based processes can be replaced by real-time equivalents.

With real-time billing, operators can handle credit and debit usage-based billing for their entire customer base, leading to lower costs and assured revenues.

A paradigm shift

Real-time billing is no longer a dream. In fact, it already serves as the foundation of prepaid billing, which in many markets worldwide represents the dominant payment method.

Real-time service authorisation and monitoring, tariffing and charging, and account updating are basic functions in most prepaid systems. However, few companies have adapted prepaid systems to address their non-prepaid market, and even fewer are prepared organisationally to introduce real-time billing principles into their mainstream markets. Therefore, for most operators, moving to a converged (prepaid and postpaid) billing infrastructure is a huge paradigm shift. However, the payoff makes such a change worthwhile.

Open door to data services

Real-time billing is highly flexible, allowing tariff plans to be changed dynamically, offering creative value-based methods of billing for new data services, and enabling easy support of the multitude of emerging new content providers. Capitalising on such flexibility, operators, for example, can now charge for services based on their perceived value.

"For most operators, moving to a converged billing infrastructure is a huge paradigm shift. However, the payoff makes such a change worthwhile"

With a range of data services such as video and multimedia messaging service (MMS) in place, the complexity of subscriber packages increases, as does the importance of real-time billing in the network. In order to fully realise the revenue potential of these new services, it is essential to leverage real-time billing for all voice and data transactions, the authorisation of every service request, the imposing of a credit limit on all accounts, and instant availability of usage information.

Affordable option for all

Real-time billing is not only about new service availability, but also about affordability. With advanced billing systems, new services are an affordable alternative for both operators and subscribers. As mentioned earlier, real-time billing limits operator credit risk which, in turn, reduces overall service cost. At the same time, subscribers can access new services without exceeding a predetermined budget. And with real-time billing subscribers pay for only the content and services they actually want, rather than paying for a high-priced content package of which they are likely not to take full advantage.

And for the enterprise, the cost benefits can be even greater. With real-time billing, mobile phones issued by companies to their employees can, in fact, operate via two accounts – business and personal. As a result, employees can access their business account for the full range of data services that can improve business communications and ultimately lead to more productivity and success. At the same time, they can access their personal account with the same mobile phone, while the employer does not pick up the tab.

Boon for emerging markets

Real-time billing’s impact can be felt in all corners of the globe, particularly in emerging markets. Given the opportunity to easily introduce the most advanced services, emerging markets no longer lag behind the rest of the pack but instead have leaped forward to reach a level on par with the developed world. With real-time billing, all operators – whether in emerging, developed or advanced markets – can offer an extensive portfolio of advanced voice and data services to their entire subscriber base. As a result, “all services for all subscribers” is no longer a pipe dream but a reality for all providers.

If, indeed, there was concern that investing in a state-of-the-art real-time billing system would deter new operators, particularly in emerging markets, the opposite is true. Real-time billing is ideally suited for greenfield deployments, since such implementation does not require any integration or adaptation, unlike instances where legacy systems already exist.

Real-time billing has put emerging markets on the map. One area that has benefited is Asia-Pacific, which is ideally suited for these next-generation systems due to the popularity of prepaid services there. Most mobile subscribers in the region are believed to be prepaid, sometimes reaching up to 95% of an operator’s entire customer base. And with the prepaid market growing rapidly in the region, real-time billing systems, which are most suited for supporting this growth, are likely to become an even more integral part of the industry.

The adoption of new billing systems has, in fact, enabled nations such as Indonesia, India and Malaysia to gain a foothold at the forefront of the mobile phone world.

Take, for example, the new Indonesian operator Mobile-8 Telecom. As a newcomer in a fiercely competitive field, Mobile-8 required a secure real-time service offering for integrated control and support of both its prepaid and postpaid subscriber operations. As a result, the company recently deployed a real-time billing system to address all voice and data billing needs. The end-to-end solution supports billing for prepaid and postpaid subscribers, voice and data services, and customer relationship management (CRM), while enabling all service requests to be authorised in real-time to all subscribers.

"As a newcomer in a fiercely competitive field, Indonesia’s Mobile-8 Telecom recently deployed a real-time billing system to support both prepaid and postpaid subscribers"

The real-time billing system allows Mobile-8 to concentrate on its core business – providing top-quality services to subscribers – regardless of the payment system. And by implementing the state-of-the-art system, together with fully integrated customer care software, Mobile-8 is well positioned as a new player in the Indonesian mobile telephony market.

Enhance personalisation, reduce churn

Real-time billing also can play a role in tackling one of the industry’s most burning issues – churn. One way to address the problem is by reducing acquisition costs – but this is much like treating a symptom. Service personalisation is a better solution, since it vaccinates against the disease in the first place.

As creatures of habit, the more comfortable we feel, the less likely we want to face change. Service personalisation, which is enabled by real-time billing, has the potential to become a highly effective way to fight the problem of churn by making subscribers feel more comfortable. When subscribers can select their tariff plan, choose preferred locations for discounted calls, and transfer credit between accounts, they are less likely to switch operators due to the hassle of having to completely redefine their mobile environment. And they are even less likely to churn if the same personalisation options are unavailable elsewhere.

A different world

The new and improved billing systems of today are clearly making their mark on the mobile phone industry. Facilitating instant availability of information, dynamic and interactive marketing programs, creative value-based pricing schemes, and convenient service personalisation for each and every end user are just some of the ways that life in a world with real-time billing is different for operators. At the same time, real-time billing blurs the lines between emerging and developed markets, affording unprecedented equal opportunities to all operators and subscribers worldwide.

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