Keeping it Real(time) Real-time charging, service delivery and all things real-time

Practically all of the global service providers participating in a Service Broker Forum event said they were seriously considering service brokers as a key part of their ongoing network transformation strategy. Commenting on poll results from the event, TMCnet’s Stefanie Mosca explained: “The ability to leverage a service broker to easily and efficiently introduce service innovation was viewed as the highest priority goal when asked to consider network transformation strategic objectives.” Amdocs case studies show that in addition to the introduction of service innovation, service broker solutions also:

• Reduce churn
• Increase stickiness and customer loyalty
• Boost average revenue per user (ARPU)

Service brokering has become a hot market, with a host of telecom and software firms racing to market with service broker solutions. Who wouldn’t want to capitalize on the rapidly expanding market? Service providers are jumping on board. For example:

Globe Telecom Philippines

implemented a service broker solution as part of a larger transformation of its network service layer; the implementation enabled Globe to quickly introduce any new service from any vendor and deliver them to any prepaid or postpaid subscriber

Axtel Mexico

has deployed service broker technology across a complex, multi-vendor network to enable such business and consumer services as local number portability, 800 (toll free) numbers, number validation, and VPN access

One of the world’s largest mobile operating groups

has used the technology to provide seamless access to prepaid services across multi-vendor Intelligent Networks, while adding new applications including incoming call screening

A leading national service provider in EMEA

has deployed the service broker approach in EMEA to offer its prepaid customers a much desired new application: a free divert to voice mail

The technical reality is fueling the popularity of service broker solutions. All too often for today’s service providers, it is just not possible to bring rich new services, applications, and bundles to prepaid customers. Service brokers provide an efficient and value-added solution to the technical problem.

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Network limitations prevent many service providers from offering additional applications or services to a prepaid customer – they can offer a simple prepaid voice service, and that’s it. Prepaid customers of course want new and different prepaid services, and if their service provider can’t offer them, they’ll find one who can.

Fortunately, a new approach has emerged to deal with this costly problem: service brokers. Service brokers are technology-based solutions that break-down the technical barriers that hinder or prevent service providers from offering a much richer set of communications applications, services and bundles to customers – including prepaid.
A service broker is a network “mediator” that sits between the network and applications, and navigates through the various different protocols and parameters across the network. It enables the service provider to blend any application (IN, IMS or Web) in order to create new value for its end customers. This means that prepaid applications can now be blended with existing or new applications, with each application having its own independent roadmap.

In a nutshell, service broker solutions enable service providers to deliver any application to any user (prepaid or postpaid) on any network (legacy IN, new IP Multi-media Subsystem and Web).

Of course, equally important is that the service broker approach saves money and improves the customer experience – it allows companies to re-use both existing and new network assets to create and deliver richer, more personalized services to customers.

For example, with a service broker in place, service providers can offer their prepaid customers:

• Wallet service
• Virtual calling card
• Credit transfer
• Pay for me
• Pay bill reminder
• Roaming data spending limit
• Home/office zone
• Personal call manager
• Ring back when free
• Conference calling
• Incoming call screening
• Virtual Private Networks (VPN) for enterprise voice communications
• And just about any other service, application, or bundle customers want, as fast as service providers can bring them to market

Service brokers empower service providers to take advantage of the huge opportunity in the market from the serious growth in prepaid, which means more innovative offerings, more customer loyalty and more revenue.

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I’d like to try and lay out the problem that is likely faced by a  service provider looking to launch new prepaid services. Marketing wants to roll out new prepaid communications services, especially considering the recent estimate that by 2015, 77% of subscribers will be prepaid. But all too often, the network people say it’s not possible.

Why is that? The problem is that existing network infrastructure gets in the way – the networks that most service providers are operating can’t combine the prepaid application with other applications. Technically speaking, prepaid is an Intelligent Network (IN) application, and the IN model only allows one application to work at a time. This means service providers cannot offer additional applications or services to a prepaid customer. They can only offer a simple prepaid voice service, which means that they are leaving money on the table.

Network equipment providers (who are the main IN and prepaid application vendors) can provide workarounds. But these are expensive and lock service providers in to that specific vendor. So, even if a service provider does decide to invest in the workaround, they won’t be able to bring applications from other vendors to their prepaid customers. That’s a big concern for the network people, especially since most service providers have a variety of different applications (especially IN applications) from different vendors in their networks.

Of course customers don’t care about network limitations; it’s not their problem. They want new and different prepaid services and if their service providers can’t offer them, they’ll eventually find another provider that can. Few service providers can afford that kind of loss in today’s ultra-competitive market, especially considering the growing dominance of prepaid. To prevent churn, many service providers are turning to service broker solutions.

In my next blog i’ll provide some more information about Service Broker solutions and how they help Service Providers handle their prepaid problem.

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When thinking about prepaid, some service providers still automatically focus on voice and SMS services. But with the ability to offer innovative communication applications such as personal call manager and wallet service, or social media packages, prepaid today also means data plans and better devices.

Indeed, today’s prepaid market offers service providers the opportunity to improve the customer experience and encourage loyalty and differentiation in markets where subscribers can (and do) move easily between service providers.

Traditionally, prepaid has dominated low-ARPU, emerging markets, where customer churn is common. Growth rates there are mostly double digit, including eye-popping numbers like 50% annual growth in India and 34% in Egypt (Global Wireless Matrix 1Q10 from Bank of America Merrill Lynch – April 13, 2010).

But prepaid growth is not limited to emerging markets. Prepaid subscribers are also growing twice as fast as postpaid worldwide, with Ovum forecasting that prepaid will grow to 77% of total connections by 2015 (“The future of prepaid wireless,” November 2010).

So the revenue opportunities are there for prepaid, as are opportunities to reduce customer churn and improve customer experience. However, there is a potential obstacle to maximizing prepaid revenue, which will be the topic of my next blog.

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