once the province of the calling cards, the creditchallenged and the unbanked. Now, prepaid is becoming an important part of the picture for service providers competing with blended service bundles that mix pre- and postpaid models within one account. Accordingly, billing systems are evolving to support these portfolios.

The drivers for converging service models are myriad. For one, the strategy can increase the value of a prepaid customer. Prepaid subscribers are much more likely to churn, but if there is a bonus or loyalty program they may stay with an operator, says Curt Champion, vice president of market and product strategy for billing vendor Convergys Corp. Prepaid users also are notoriously bad at spending money on premium services, but hybrids can offer the ability to create better value, and increase the likelihood of their using those premium services, particularly if the operator can reduce churn and therefore subsidize equipment.

Now, the billing system should enable any product for any subscriber irrespective of the way they want to pay and how they want to view their account.
Convergys Curt Champion

Convergence is also a function of a need for service innovation. Providers are often stymied by inflexible systems in efforts to roll out new service sets. In marketing, there is a frustration in not being able to make the same offers available to all customers, regardless of how they pay, says Liam Maxwell, vice president of product management at Portal Software Inc. Traditionally pre- and postpaid are two different infrastructures, and now creating compelling offers is being constrained by that fact.

On the demand side, consumers and enterprises alike are looking for family plans, where different billing rules can be applied to different people within an account. A teenagers mobile phone might have a prepaid spending limit, for instance, or certain salespeople within a company may be given unlimited postpaid voice access and a prepaid account for text messaging. Also, end users are demanding more content and e-commerce options, which tends to involve a prepaid model.

Service providers are in the midst of a transition, says Jack Storer, director of business solutions at Intec Telecom Systems plc. With declining voice revenues, they are trying to become media and content companies. They are competing in this space with anything from cable companies to Web companies, such as Google, Yahoo! Inc., iTunes and Netflix Inc. In order to effectively compete with these new adversaries, service providers will have to invest heavily in their legacy BSS infrastructures [to become more flexible].

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Rodopis service-agnostic product-specification environment designs and bills for complex bundles that mix prepaid, postpaid, fixed and variable charges.

Users also are demanding serviced personalization in the way of a la carte bundle-building. Down the road, blended services enabled by fixed-mobile convergence such as the ability to order a movie for the DVR via a cell phone will require pre- and postpaid elements within one view of the subscriber. To realistically deliver this vision takes a change in technology, business processes and customer service, says Gordon Rawlings, director of portfolio products and solutions at Amdocs Ltd. The network convergence we see that allows these services has a corollary on the BSS side.

Further complicating matters, personalization and Web 2.0+ could see users empowered to design their own pricing plans and bundles, says Todd Benjamin, president and CEO of Rodopi Software Inc. Imagine the reverse auction of Priceline applied to communication services in which service providers vie for some or all of the user-designed bundle.

Along with the evolving service sets comes an increased customer care expectation; users want to pay their bills how and where they choose. Subscribers want personalization with full access to available services that suit their individual needs, says Jeff Popoff, vice president of marketing at Redknee Inc. Regardless of whether the subscriber is prepaid, postpaid, hybrid, or belongs to a group or family plan, they want the ability to immediately use and mix and match voice, messaging, data, family and community services with convenient payment choices. Without this choice, subscribers are less likely to adopt new services, increase service usage and be willing to pay for more than a fairly basic plan.

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Unfortunately, typical postpaid systems dont allow for such flexibility. Today, as a postpaid contract subscriber, its sometimes difficult to view my account. I often have to go on the Internet, or maybe phone up the call center, says Champion. It is unusual for me to use my handset to see the cost of my last call on the screen, or view my total spend for the month. It is also tricky to select my own credit limits, such as limiting my spend on certain types of calls, or data services. Often, it is impossible to use my handset to select a new service, or stop an existing service.

Many of these limitations are due to billing systems, says Champion, noting Convergys anticipates a future wherein consumers can use their handsets to manage their entire accounts, spends and credit limits using menus on the phone screen.

That time will be ushered in by convergent billing systems defined as more than simple bill stapling, where each service is provided completely independently, and the line items are consolidated at the end of the billing cycle onto a single statement.

Now, it is assumed any strategic billing system can do that, says Champion. Today, convergence really refers to any subscriber type, and includes payment methods and the overall customer experience. Now, the billing system should enable any product for any subscriber irrespective of the way they want to pay and how they want to view their account.

That means merging what used to be two distinctly separate systems into one, and combining it with network intelligence and CRM systems. For now, prepaid billing is primarily controlled by network-integrated boxes, which are always on and provide simplistic rating, account debiting and IVR routing if balances get low. They are not good at cross-promotion, loyalty points or scaling, says Kurt Silverman, CTO at Comverse Technology Inc. Postpaid systems meanwhile are financial systems outside of the network that analyze, rate, store and invoice a vast amount of information, while sending subscribers to collections and telling systems to shut off service if necessary. They run in batch mode, and are not five-nines reliable or able to run in real time. Getting the two to talk to each other, let alone work in concert, is an almost impossible job.

Whats needed now are billing systems that can sit at the edge of the network and offer authentication, financial authorization, and real-time balance management functions alongside postpaid rating and billing, with centralized balance management converged on subscriber type. This model not only offers more sophisticated rating methods for prepaid services, it also provides a more complete view of the customers activities to the service provider, and a richer set of data to the providers CRM system, says Intecs Storer. It can also streamline operations for the service provider, using a single rating engine based on a single product catalogue for both prepaid and postpaid transactions and is able to provide benefits such as discounting across all services, or across account hierarchies, along with programs that reward customer loyalty.

In fact, convergent billing will need to become more intelligent than it is now in order to scale for real-time metering and monitoring of entitlements and personalized services, says Arpit Joshipura, vice president of product management of Redback Networks Inc., which offers the capability to allow a subscriber to customize and personalize its bundle through dynamic service changes initiated from self-service portals. Personalization will mean that billing functions need support from the network layer in order to scale. Call records need to move beyond traditional start-and-stop traffic monitoring to real-time byte-by-byte tracking of specific classes of traffic that reflect specific service offerings whether voice, video, data or all three.

Convergent platforms are coming to market that can support the requirements for hybrid services, from sources in this story and others. Innovative approaches also are cooking. We see a strong trend toward using Web-based systems that can integrate all the functionality related to customer life cycle management, says Gary Doty, director of sales and marketing at CustomCall Data Systems Inc. Everything including service selection, service activation, bill payment and presentment, provisioning, CPE fulfillment, customer care, trouble ticketing and collections. The key is the ability to enter data once, and have it flow through to the right systems at the right times … and have the appropriate processes completed based on the products selected, and then bill for those services quickly and accurately.

Amdocs Ltd.
Comverse Technology Inc.
Convergys Corp.
CustomCall Data Services Inc.
Intec Telecom Systems plc
Portal Software Inc.
Redback Networks Inc.
Redknee Inc.
Rodopi Software Inc.

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