India Telecom

February 18, 2005
Toward network agnostic convergent billing

Geetanjali Wadhwa & Pradeep Chakraborty

BANGALORE, KOLKATA, NEW DELHI AND MOSCOW -- Convergence in the billing scenario relates to a multi-dimensional perspective and could be at various levels. According to Raghav Sahgal, managing director and vice president, CSG Systems, Asia Pacific and China, from a billing perspective, network level convergence meant having a network agnostic billing platform, which also allowed independence of the payment mode.

It also meant a billing system that supported all kinds of network access technologies, be it fixed, mobile (2G/2.5G/3G), cable or satellite. Service-level convergence simply meant having the ability to bill for all kinds of services, voice (usage billing), data (volume or transaction-based billing) or content (physical content or digital content, example, music downloads, ring tones, pictures, movie tickets, etc.), enabling micro or even macro-level payment.

Convergency in terms of market
Malcolm Lewis, executive vice president, product management and marketing, Ushacomm, said, that the most recent trend in convergent billing was bringing together broadband, Wi-Fi and mobility. "The idea is that a mobile customer can chose the most appropriate IP access mechanism for his current set of services. For example, if a mobile customer is in the airport lounge, he can access service via Wi-Fi; at home via broadband connection; and on the move, by using mobile services. However, all three services are billed through the mobile account."

Prior to this, seamless mobility was prevalent -- fixed and mobile telephony. In short, the operator and the customer can take advantage of cross product discounting. This form of convergence was about accessing an IP facility and being able to access/charge for different types of content services through the most appropriate channel across bandwidth.

Andrey Morozov, president and CEO, CBOSS, a provider of convergent billing and business OSS systems, as well as messaging, Internet and VAS solutions for telecom operators, noted: "Modern trends in telecom require billing convergence in terms of markets (GSM, PSTN, VoIP, ISP, etc.,) and a prepaid/postpaid approach. In essence, this trend offers subscribers and telcos a one-stop shopping option. Subscribers can have one access point to manage all the telecom services they receive, for example, through self-service media like IVR or Internet portals." He added that subscribers could benefit from cross-market discounts and promotions. They could also receive combined bills and reports, and pay for all services with one check. "The operator benefits from having one tool for all operations performed with the subscriber data. With one OSS/BSS handling all subscribers and services, uniform procedures can be implemented for all types of subscribers. Less personnel training would be required and there would be less space for human error left," he said.

N. Diwakar, chief operating officer, Sigma Software Solutions, added that incumbent communication services providers were looking for growth/survival in broadband derived services revenue. Distance related tariffs for voice were being replaced by flat rate tariffs or by flat rate IP-voice. The message for service providers was: they need to take advantage of the opportunity provided by broadband value-added services to protect profitability and move as quickly as possible to a converged network.

He listed certain trends in convergent billing. These include: service providers are offering multi-play services over heterogeneous platforms to different subscribers like residential, business, SOHOs and others; the billing or revenue model is moving from usage and/or distance-based to various others like flat rate, pay-per-use, premium, third party/content provider driven; very strong identity management is needed to enable the usage of various services by a subscriber from the same device and global location. Different service usages have to be billed based on various rate plans, various service providers to the subscriber on the same bill; complex partnerships and channels in delivering services throw up the need for a good, real-time multi-party settlement system; the OSS system has to address customer self services, and e-commerce and m-commerce activities from ordering, fulfillment to billing; and finally, legacy/existing investments need to be protected.

Within a couple of years, the communication service providers market would be a combination of landline operators, mobile phone companies, DSL/cable companies, content companies and information service providers. Each service provider would be a mix of either one or all of these offerings, and will use various technologies to maximize their revenues and keep their OPEX/CAPEX costs low.

According to Diwakar, convergent OSS/BSS systems need to meet the following demands of the operators:

• Business demands: Differentiation in the market; convergence (process, infrastructure, and organizations); alignment of business strategy and metrics; visibility and manageability of end-to-end business; and service (product) focus.
• Operational/organizational challenges: Increasing complexity of new and emerging services; inefficient process to service mapping; fragmented and siloed organizational and operational structures; inflexible BSS/OSS architectures; and integration challenges (legacy, COTS, customization).

In terms of features, the new-generation operational support system (NG-OSS) would help the service provider in several ways. These include value-added service offerings and billing at a flat rate or pay-per-use. The result: increased ARPU and reduced user churn. Next, the rating would be variable and complex. It would also have to handle settlement with the content providers who add value to the operator's services.

Further, gateways, portals and other content delivery entities would be part of service operator's networks. Finally, there would real-time authentication mechanisms and fraud management systems.

Diwakar added that the Sigma SMP (service management portfolio) provided the sophisticated service management functionality required, enabling automated service provisioning, activation and diagnosis of services in a multi-vendor, multi-protocol and multi-service communication delivery network.

Paradigm shift to next-generation billing
According to a spokesperson from Convergys, in today's converging content, e-/m-commerce, and communications industries, new and incumbent operators were being forced to adapt to new models for doing business. Increasing competition, higher customer expectations and the demand for differentiated, value-added offerings were prolific in the market. To manage these factors effectively, the operators must introduce convergent billing systems that add value to their customer relationship management (CRM) and enable the revenue management of a complex value-chain of partners. For these reasons, operators relied on billing and customer care providers like Convergys to help reduce operating costs and the risks associated with mission-critical applications.

These market dynamics required a paradigm shift from conventional to next-generation rating and billing. The next-generation billing systems should provide tools for actively managing and developing revenue streams. These would turn billing into a marketing tool, enabling the operators to reduce the time to market; achieve better control of customer relationships; and optimize cash flow. The convergent billing systems should focus on having the following capabilities to fulfill the demanding needs of the marketplace:

Customer-centric approach: Billing systems should cohesively manage all customer accounts and billing information for effective and efficient invoicing, reporting and business development.

Rapid time to market: By being flexible and futuristic in design, billing systems should be truly convergent - multi-network, multi-service, multinational, multi-lingual, pre and/or post-pay accounts; have an event-driven architecture - with an extremely configurable and high performance rating engine, offering an unlimited range of products and services, and supporting tunable and scalable real-time processing; as well as offer multi-service packages in highly flexible pricing models - like cross-product discounting, volume-centric pricing, cost-plus pricing, retail/wholesale pricing models.

Flexible and service independent: Should bill for any service or services, including voice, data and content, irrespective of the delivery network.

Provide freedom to innovate: It should provide highly flexible pricing models and an unlimited range, as well as permit real-time modification of rate plans, enabling responsive-competitive marketing programs.

Support marketing and business development features: The billing system should be able to offer a variety of flexible discount models, such as bonus points and loyalty schemes.

Designed for integration: The integration options should be comprehensive and extremely flexible, thus enabling operators to leverage their own specialized software components.

Reduce TCO: The convergent billing system should deliver compelling lifetime cost of ownership, cost-efficient scalability and enhanced system availability.

International in approach: Billing systems should be able to handle the language, currency and tax requirements of multinational service providers who support multinational customers and require products with multi-lingual or multi-byte GUIs and are billed in the local currency.

Carrier-grade architecture: Carrier-grade architecture supported tier-1 providers revenue assurance needs and encompassed the functionality, operability, scalability and availability that were generally expected from the most demanding service providers. Robust, next-generation, and scalable real-time capabilities provided compelling business benefits to those providers with true, real-time business models. Moreover, the billing system should concurrently support non-real-time processing options in order to ensure that clients, not technology, determined how they ran their businesses.

Partner revenue management: The billing system should also manage the rating and settlement of complex, multi-party value chains that were essential to launching next-generation services profitably. It should also allow conditional settlement that enabled operators to effectively manage financial risks across their retail and wholesale revenue streams.

Provide investment protection: It should protect investments of customers by product enhancements.

Monetizing 2.5G(GPRS)/3G (CDMA) services
Reportedly, 2.5G(GPRS)/3G(CDMA) services were being monetised through convergent billing systems. Lewis at Ushacomm said that content services were available in Europe and North America. These were currently being directed toward the Indian market. He added: "It is about extending the capability of being able to download ring tones and music downloads, to rolling out picture messaging and video streaming. All require IP services. It is about deciding on the most appropriate data pipe to provide the service, based on the current customer's situation and bandwidth availability."

CBOSS's Morozov said that successful service promotion dramatically depended on tariff flexibility. "In packet data networks, where multiple sessions may be simultaneously executed via a single customer terminal, requirements to the rating efficiency and speed are very high. Some services consumed in these sessions can be rated based on traffic (duration or data volume), while others can be rated based on the content. Currently, there exist two main approaches to flexible content rating - proxy-enabled method and delegation of service fulfillment functions to a content provider. The majority of operators use a combination of these two approaches. In complex situations both approaches can be used to compliment one another," he noted. Convergence was an important issue in 2.5/3G networks, as the subscribers were receiving services different in nature (telephony, video, music, games, etc.), but would like one access point and a similar procedure of receiving services and paying for them.

Sigma's Diwakar said the world was migrating toward data-centric networks. The 3G networks were more aligned to data. The next 4G standard would be a completely IP based network. It would have higher data rate, higher spectral efficiency and support real-time video, voice, and data applications on mobile devices (phone, PDA, Laptop, IP-based consumer electronic equipment). Most of the service providers would move over to these technologies, though over varied time frames, depending on their capital spending strengths.

Being a data and IP friendly network, service providers would look at making maximum revenues and profitability by providing content. A few of the offerings would be least-cost routing (low-to-medium quality services like voice and non-critical data), content services, high quality video, IPTV, e-learning, real-time gaming, mobile e-services, etc. These kinds of service platforms would have differentiated billing for usage of service, pay-per-use and for content. This would be the only way the operators would keep their revenues and profits intact/grow in face of flat-rate voice/data competition, re-iterated Diwakar.

The spokesperson from Convergys said that next-generation convergent billing systems, such as its Infinys Rating and Billing, were monetizing services for 2.5G/3G services by their capabilities. These included:

Truly convergent billing: Multi-network, multi-service, multinational, multi-lingual, pre- and/or post-pay accounts;

Event-driven architecture: Extremely configurable and high-performance rating engines, unlimited range of products and services, tunable and scalable real-time processing;

Multi-service packages: Cross-product discounting, volume-centric pricing, cost-plus pricing, and retail/wholesale pricing models;

Complex hierarchies: Multi-level customer and account, multiple currencies and tax regimes, hierarchal discounting schemes, corporations, pre and/or post-pay hierarchies;

Partner revenue management: Multi-party billing, private branding, conditional settlement, partner-specific access controls, interim usage dispatching;

Carrier-grade architecture: Robust, scalable, extensible functional and technical architecture, complete and an open set of interface points and methods (APIs, J2EE, EAI), and APIs for streamlined CRM integration; and

Comprehensive functionality: Browser-interface for CSRs, flexible payments and collections, contracts, and easily configurable via intuitive GUIs.

Mediation principles blending existing, new technologies
Changes are reportedly taking place in the mediation domain as well. Morozov said: "The efficient solution for enabling an OSS/BSS system to keep up with the changing network environment and technologies is to keep all network-specific procedures at the mediation layer. A mediation layer must offer flexible configuration options. Changes made on the mediation level should not affect OSS/BSS to ensure its uninterrupted operation. This way, the OSS/BSS system remains independent of the protocols and formats used to collect the traffic data from the network elements." The introduction of Internet-based services, including content-based 2.5/3G services, created the demand for collecting rating data from more than one network element and combining this data to come up with the complete traffic detail records for rating. The mediation systems should be able to handle such tasks, he added.

Commenting on effective mediation principles that blended existing and new technologies in the same network, Lewis added that changes taking place in the mediation domain were pushing out of application processing to network elements (data collection) to remove the application processing further downstream. "The benefit is that the data can be filtered and aggregated at an earlier stage so that the service information is available earlier. This reduces the load on the OSS platform. The rating process is being moved into mediation, which means pre-rated records can be passed onto the billing platform. Having aggregation and filtering capability means that session information can be separated from content access," he elaborated.

Diwakar noted that subscriber service delivery was becoming very complex, and hence, should be used by the mediation system to capture a wide range of usage details in real time, and be flexible to change as on-the-fly services were consumed. The mediation, OSS and billing system should lean on a federated subscriber service user information model. With content services ruling the roost, it would be necessary for mediation systems to talk to content providers and push bill information to billing systems for each subscriber. He added that having specific features in their mediation system, would save service providers investments as they upgraded or introduced new services.

The spokesperson from Convergys added that until now, mediation software had generally served as a passive collector and distributor of transaction and call usage data. "Today, next-generation mediation systems must perform functions far beyond traditional mediation capabilities and play a much more active role in the entire billing process. This is due to the massive growth in transaction volumes resulting from next-generation services, as well as the increased complexity of network structures and the accounting data they deliver to mediation platforms," he stressed.

According to him, Intelligent Information Management (IIM) was a concept of turning mediation software into a central hub to intelligently manipulate complex data streams within the BSS/OSS. The IIM concept provided significant benefits over traditional legacy mediation. Convergys' Infinys Mediation Management offered IIM to operators by providing a consistent view of an operator's entire transaction stream through a single, convergent mediation platform. Operating in a multi-network, multi-service, and multi-BSS environment was possible through configurable, flexible collection point definition and rules-based data handling that enables data correlation and aggregation from many sources.

The IIM principles include multi-network, multi-service and multi-BSS capabilities; complex data routing and processing from/to many entities; generate information - mediation = data control; support real-time, two-way transaction handling; rapid introduction of new services; multi-channel revenue assurance; and multiple record formats and systems.

Mediation systems should be network and service-agnostic; permit network visualization, prepaid and postpaid convergence, global roaming support, IP usage management and settlement; allow correlation and aggregation from many sources; follow rules-based data handling and manipulation; support pre-authorized as well as post-event scenarios; support configuration, not coding; allow flexible reporting, audit trails, and simultaneous multi-format, multi-delivery record formatting and delivery.

NG-OSS principles facilitating move toward customer-centric operator
Let us now examine the NG-OSS principles that are in place, which would facilitate a move toward being a customer-centric operator. Lewis at Ushacomm said that the key benefit of convergent billing was having a single point of customer contact. This resulted in improved customer responsiveness and enabled the operator to compile simpler bundles of product offerings. There was also a move toward Web-self care.

Some of the benefits included transfer of power to the subscriber. This would enable greater control for the subscriber in managing his account. There would be more information about the services on offer that can be stored on the Web, thus providing greater intelligence to the subscriber. Next, Web self-care would help subscribers to compare plans and packages and take an informed decision. This would lead to better care and lower churn rates. Besides, 24/7 customer care meant that subscribers could access their accounts as and when required, rather than being tied to call center hours. This in turn would result in higher customer satisfaction levels as the subscriber got 'what they want' and this ultimately would reduce churn rates.

Significant cost savings were yet another benefit. Subscribers could easily view bills and make payments online, so communications service providers could decrease their 'days billing outstanding' (DBO) ratio. Next, the Web-based self-service required fewer CSRs, thus reducing the operational overhead costs. In short, operators could bring down costs and improve response times to customer enquiries. The operators would maintain better visibility of customer's usage and trends and target services and reduce churn rates.

Morozov at CBOSS pointed out that one feature differentiating a customer-centric operator was that this operator offered customer-tailored service. "With a large subscriber base, such tailoring is impossible without automation by OSS/BSS. One example of such tailoring is linking credit control processes to the subscriber behavior. The OSS/BSS can automatically restrict credit control for subscribers with bad credit behavior and offer more tolerance for those with good credit history (e.g., reliable subscribers can automatically be granted longer bill payment periods, higher credit limits, etc.).

"A customer-centric operator offers its subscribers the freedom in configuring service parameters for themselves. Subscribers can be allowed to configure peak/off peak discounts (e.g., each subscriber has two hours per day when the calls are discounted, and he or she can select when the discount will be applied), decide how to use earned bonus points, pick favorite numbers, etc. A customer-centric operator is sensitive to what subscribers like and dislike. OSS/BSS must provide the data on subscriber behavior for analysis - to discover trends and patterns, and adjust service policy to match the demand," he estimated.

Diwakar added that NG-OSS was service provider agnostic. It placed the customer at the top of the model. It also advocated that OSS/BSS systems were such that they took care of customer responsive, with customer self-service portals. Next, there would be immediate service order/change update across all enterprise systems. There would be faster implementation of new services and rate plans. Finally, there would be billing accuracy, leading to timely collections and low defaults. Sigma's SMP Platform functioned as a single-point gateway for a flow-through convergent provisioning, activation, identity management and diagnostics needs of voice, messaging, high-speed Internet, video and content services.

Addressing security threats to NG-OSS
The exposure of the NG-OSS to the Internet could bring unprecedented security threats. How would this be addressed? Diwakar said that each enterprise-level system, including the NG-OSS, was built to interface strongly with disaster recovery, security and fraud management systems. This was a specialised area and there were many ISVs in the market that focused on these segments. A robust platform, which was built keeping the NG-OSS business map, would meet the threats of IP-based networks and systems. For example, the Sigma SMP uses SUN Systems SunOne Identity server for identity management. This is said to be one of the sturdiest security servers currently available, and runs various leading e-infrastructure systems.

Lewis added that security threats were an issue that affected all industries, especially finance and banking domains. European and US operators had been operating Web self-care platforms that allowed customers to manage accounts and make payments against accounts for a number of years. The same kind of security measures were put into place as those by the banking sector, where people have made card payments for a long time. To prevent a breakdown in security, secure log-on passwords, secure payment Web sites and encryption of data were used.

Morozov said that information security was one of the primary concerns, as using the Internet as a tool for self-servicing and online service subscription was an integral part of any modern telecom operator. Possible security threats were: confidentiality compromise - when unauthorized users gained access to information; integrity violation - when unauthorized modification of data occurred due to the activity of an intruder or users mistake; and breach of availability that involved the denial of access to information by the authorized parties.

"Russian information security technologies hold leading positions in the world. CBOSS's products are originally designed to use the Internet as one of the interaction channels for an operator and its subscribers. However, our experience in information security and data protection allows our clients to significantly reduce such risks, he added.

Best practices in OSS deployment
Finally, the best practices in OSS deployment. Sigma's Diwakar mentioned a list of the most prominent operational requirements that a service provider should assess for an OSS service management system. These are as follows:

• Service-centric architecture.
• Proven scale, performance, and reliability.
• Multi-service deployment experience showing depth in installation and implementation capabilities.
• Ability to integrate with the existing business, operational and network management systems; protecting the existing front and back-office investments.
• An information model for subscriber, service and network-based information that can be easily accessed by other systems for essential OSS operations.
• Detailed understanding of the underlying network and the associated inventory of physical and logical resources so that accurate provisioning can occur.
• Ability to abstract services from the network so that offered services are not dependent on a particular vendor platform, and the service management system automatically translates the service action into the required provisioning/activations processes required by the applicable vendor platform (i.e., support a consistent service across a multi-vendor network environment).
• Automated provisioning and activation for complex service offerings with transactional integrity to avoid lost orders.
• Workflow engine that supports the unique requirements of service management.
• The ability to diagnose the service delivery network when problems are reported along with visibility into network performance and health.
• Open APIs that allow rapid integration to other systems.

Ushacomm's Lewis noted that the best practices included ensuring that the customer business process was properly understood and mapped to the OSS vendor's solutions. This also meant ensuring the operators business processes were appropriate to the direction their business was taking. And, where necessary, adjusting the processes to take advantage of OSS/ BSS facilities and functionality to reflect changes in business practice.

"In particular, areas associated with credit control, service provisioning and activation need to be performed in near-real time. The operator's billing cycle, and the flexibility to move customers to different billing cycles to suit the customer's financial planning, needs to be considered as well. The key to efficient BSS/OSS is to deploy solutions that require configuration and not customization, thus reducing time to market and cost of deployment," he added.

CBOSS's Morozov said that nowadays, the timely implementation of an OSS was the key to success for a mobile operator exposed to severe competition. To compete efficiently, an operator should have a flexible pricing policy, and provide quality service, including value-added services. Successful implementation of a high-quality OSS created extra competitive advantages for the telecom operator.

"Besides software and hardware platform, our turnkey implementation includes developing an operation technology customized for the particular telecom operator. Training of client company personnel to operate the new system is one of the primary concerns. It includes on-site training that helps resolve any problems, and answers any questions that may arise at the initial stage of deployment of the new system. Finally, effective data migration from the replaced system to the new OSS solution is significant for successful implementation of the system. The operator's subscribers should not experience any inconveniences due to the data migration. On the contrary, they need to enjoy improved quality and expanded range of services provided by the operator," he concluded.

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Convergent billing has multi-dimensional perspective
Raghav Sahgal