|Issue:||Asia-Pacific I 2005|
|Topic:||Real-time billing makes its mark in emerging markets|
|Title:||Division Vice President, Asia Pacific|
Mr Shabat is Comverse Division Vice President for the Asia-Pacific region. Mr Shabat has worked for over 10 years leading business efforts in Greater China, Australia, South East Asia and India. Currently, Mr Shabat is the Vice President of Indo-China, managing seven offices in the region and an extensive R&D Centre in ShenZhen. Previously, Mr Shabat worked for such innovative technology companies as Apple Computers, Orbotech and Applied Material. Mr Shabat holds an MBA from the University of Tel-Aviv.
The Asia-Pacific region makes use of real-time billing that lets operators handle credit and debit-based usage for their entire customer base. By reducing subscriber bad debt risk, real-time billing, lowers costs and assures revenues. Real-time service authorisation, monitoring, tariffing, charging and account updating are basic functions, which make prepaid systems possible. Consequently, they make possible most of the mobile services in the developing regions of the world. Real-time billing lets emerging markets enjoy the same services available in developed markets.
Billing, spearheaded by the arrival of real-time billing systems, is now a dynamic force with strategic implications and major repercussions for operators worldwide. For one, it drives profitability by creating new revenue opportunities and cutting costs. At the same time, it intensifies an already highly competitive environment by enabling operators to offer a basket of advanced data services to target markets. Operators and subscribers in emerging markets, including those in the Asia-Pacific region, are among those enjoying the powerful benefits of real-time billing. 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. Second, 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. Third, operators can seize the opportunity of impulse buying, which is critically dependent on prompt action. For example, if subscribers purchase a musical ringtone of 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. Banks have long recognised the need for real-time purchase authorisation and charging to a credit card account. Now, mobile providers can for the first time operate based on managed risk principles rather than on trust. With revenue leakage proving to be more damaging than ever, real-time billing can reduce the extent of losses, since circuitous CDR (Call Detail Recording)-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, now can charge for services based on their perceived value. 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. Moreover, with real-time billing, subscribers pay only for the content and services they actually want, rather than paying for a high-priced content package of which, they are not likely to take full advantage. 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 introduce easily 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 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 has proved true. Real-time billing is ideally suited for green-field 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 many parts of the region are prepaid, sometimes reaching up to 95 per cent of an operator’s entire customer base. 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. Also in Indonesia 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 the authorisation of all subscribers’ service requests in real-time. 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. By implementing a 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 are to contemplate 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. 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 programmes, 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.