Tech Scan

Charge your Interconnect access accurately

Kaushik Phukan

Thanks to the changes in the government’s telecom policies, local access carriers can now directly interconnect to other access providers in the same circle and also to all NLDs and ILDs. The new TRAI interconnect policy provides a share of the revenue to all three networks - originating, transit and terminating. In all these activities, a huge amount of money is involved, which the industry often tends to ignore.

But to make more money and hence build up a profitable business, the carriers need to have the capability to accurately bill inbound calls, verify interconnect bills from other carriers, and to provide detailed drill down reports and MIS for settlement, reconciliation and dispute resolution.

Inter carrier cost is the single largest recurring cost item for many carriers. For some, it can be also their single largest source of revenue. After all, most of the inbound calls usually come from other networks. And that’s where interconnect settlement comes in.

Interconnect settlement manages payments between companies when calls cross networks. The carriers that bill the customers must pay the other carriers. Almost all small carriers’ outbound calls terminate on another network, so half of their retail revenues may be absorbed by payments to other carriers for handling outbound calls. In fact, settlement revenues from inbound calls may more than compensate for settlement costs from outbound calls. Many a times settlement cash flows may be large or larger than retail billing cash flows.

If a carrier can negotiate good interconnect rates from other carriers, they can offer lower retail rates and hence attract more business. If a carrier offers good rates to other carriers, they will attract more traffic into their network. In fact, interconnection encourages growth and competition.

Keeping that particular need of the telecom market, Estel Telecom, the Delhi based telecommunications company, has come out with clearing house services for inter carrier billing and settlement. This service is operated in partnership with Hansen Technologies, which is one of the world’s largest providers of billing solutions and also a major operator of billing bureau services.

Raj Hajela, MD, Estel Telecom says, “the benefits of the clearing house are many. We can take care of all your inter carrier billing and settlement issues. The charges are on the basis of usage.

We can ensure complete security and full control over your valuable data and elimination of technology obsolescence risk on hardware and software. The control remains with you and a migration path is available for your stand-alone inter-carrier billing platform. In addition to all these, the bureau is operated by highly experienced operators of 24x7 mission critical telecom services.” Many operators rely on the interconnecting carrier to tell them what they owe and are owed. That usually means loss of money, as many times they do not get the true figures. Hence, different companies use different means for interconnect access charges. Large carriers often build elaborate in-house solutions. While on the other hand, most of the small carriers start from CDR (Call Detail Record) analysis reports and then upgrade slowly.

But in-house development can be an expensive approach. There are several software vendors in the market who provide interconnect settlement packages, which can be upgraded to meet the emerging settlement needs. They are designed to be extremely flexible, so new types of settlement data; new charging arrangements and new reports can be implemented at a low cost. Many companies even outsource their interconnect billings to other companies. The advantages of an outsource solution are that the carrier does not have to hire and manage specialists in interconnect settlement, who can be hard to find. Carriers can take advantage of the economies of scale provided by the outsourcing supplier. For many carriers, outsourcing is likely to be the modest cost-effective approach.

“Estel in partnership with Hansen provide out-source settlement services and maintains the settlement software and the hardware that it runs on. We maintain the rates, operators, taxes, network connection definitions and such other things. We also run the settlement processes and look after reconciliation,” says Hajela.

The clearinghouse from Estel is presently on trial and the company has signed up a few clients for trials. The company plans to go into full-blown operations within the next couple of months.