From Arms Length to Hand-In-Glove

Carriers that outsource their billing operations reduce operational expenditure and avoid a capital outlay for the platform. But that doesnt mean that outsourcing is a worry-free proposition. It requires an intermingling of disparate elements: inhouse and hosted platforms, processes and data. To boot, changing carrier services have given rise to further concerns such as how to support on-the-fly marketing pushes with a rating system one doesnt own.

Increasing complexity in carrier business models has made the service bureau approach a bit more intensive than it was in the days when post-paid billing for landline, TDM voice was the bulk of the traffic. For instance, operators, pushed to grow top-line revenue by adding to the average revenue per user (ARPU), are attempting to craft a oneto- one marketing approach, where systems glean information from the OSS to learn about end-user service consumption habits, and react accordingly.

Convergys outsourced operations data center

There is a real-time revolution in billing, says Larry Frank, vice president and chief marketing officer of the real-time billing division at Comverse, which provides service bureau and licensed billing solutions for telecom operators. We want to have more and more information about transactions as it happens, from authorization to rating and charging, because we need it to craft promotions and marketing on the fly. A classic example of this, he notes, involves a person who sends an SMS message from his wireless handset at 3 a.m. The network operator immediately pushes a promotion to the user: Send three more SMS messages and you will receive two hours of free voice minutes. The operator may be giving away minutes, but gains usage on his network during a time that network is underutilized.

The challenge for an outsourced billing solution is how to take that information and provide it to the operator in a way that makes sense, Frank notes.  The situation becomes more complex as the move to personal area networking continues. Eventually, people will have personas within a service or within one phone number, so a wireless plan may be corporate by day, and billed to a personal account at night, he continues. The operator will need to target the marketing activity to the individual based on the particular persona in control at that moment in time that he or she downloads a ringtone or sends a text message.

And thats not all. Zohar Ronen, associate vice president of marketing at Comverse, points out that billing systems convergence plays a part in creating operator challenges as well. They have mediation and a roaming system and pre- and post-paid, he says.

And they may be selling someone elses content as opposed to airtime. To respond in real time and to maintain accurate monitoring of data transactions means they need to integrate what they have and move to a convergent billing solution.

The answer to these problems lies in systems integration. Rather than sending transaction information in service-siloed batches several times per day as was once the case, outsourced billing providers now often perform systems integration with their carrier and service provider customers to provide a more holistic data view in real time. Essentially, the outsourced system ends up looking like any other in-house system.

Carriers should be prepared for the customization and integration process. Its critical that the data and system functionality is exposed to other systems and applications, says Brian Clark, executive director at CSG Systems Inc., which supports about 50 million subscribers on its platform, in a service bureau model, for operators like Comcast Cable and Echostar.  CSG provides multiple methods to allow service providers to tap their outsourced data, including standard APIs to accounting systems and other account management functions, and a set of two-way provisioning APIs. We can connect to a set-top box in the home, or to a switch, and turn features on and off, says Clark. We also offer Vantage, which is an application where we warehouse all the data and allow ad hoc queries on operations, revenue, trends and marketing campaign management information. CSG holds the clients data in a hardened data center and connects with their IT systems via direct trunking.

Scott Ortiz, director of product management at CSG, says integration with front-office applications is another detail carriers should consider. A big push for many operators is to get into the commercial sector, he says. They are packaging their services to be applicable to business, and that means they have new call centers and sales staff requirements. We are looking at what we need to add in terms of sales-force automation and supporting inside sales, appointment setters, channel partners and other business-to-business accoutrements.

Generally providers already have a set of systems in place, and they want  to make a transition to outsourcing without reinventing the wheel, says Dennis Stoutenburgh, president and COO of ILD Telecommunications Inc. He notes that information like credit histories, credit thresholds, alternative billing mechanisms and other financial data requires customer service reps to have sophisticated systems on their desktops; ILD will integrate with the call center applications to input its data into their existing platforms. It takes some of the risk out for service providers in making the move, Stoutenburgh says.

Carriers considering outsourcing also must think about data translation to and from other in-house and outsourced systems, according to Ron Whaley, vice president of sales and marketing at OSG Billing Services, which prints and mails statements on behalf of carriers and resellers. To generate a timely bill that gives the message the carrier wants, third-party providers need to work with bill printers to identify and capture the necessary data cost-effectively and accurately. We have to know their business logic rules, Whaley says. Our struggle as we try to capture the appropriate data from the customer is understanding what generates it, which systems, is it outsourced, how will we get the file and from whom.

The rush to add new services complicates matters. The main priority for operators is differentiation and the need to add value,  says Whaley. And as they add on systems and programs, that adds a lot of complications in merging multiple data sets onto one invoice. OSG works with clients to identify appropriate data elements, and examines the actual process that creates the files to be exported, for a consultative approach to the problem.

Another challenge in the quest to become an extension of the clients system is nontechnical institutional attitudes can throw up roadblocks. CSGs Clark says:  Most organizations have an IT department, and they like to see their systems and be able to touch the boxes. When you outsource, those aspects are not on site, so the department has to let go of their oversight that way.

Sometimes the resistance comes from the top, where a CEO does not want to waste  the investment already made, whereas the staff-level people see the need for a system improvement more clearly. Frank Peregrine, chairman and CEO of outsourcer CustomCall Data Systems Inc., says a phenomenon among ISPs who are getting into VoIP, and who are typically operated by computer professionals, is an initial belief that they can handle the requirements inhouse.  However, what they do not yet see is that thousands of monthly customer transactions will become millions of monthly call records, he says. The scale alone requires a complete overhaul of their existing systems. Furthermore, even a slight systematic error in call processing can result in very expensive mistakes.

Joe Dooley, director of professional service engagement at Convergys Corp., which hosts billing for several large wireless and wireline carriers, notes that ownership is an issue.  When you provide outsourcing, you have to work closely with clients, he says. They have to understand how you do things and why, and essentially they lose that expertise for themselves. And we become accountable.

The outsourced partner also needs to be well-integrated into business-planning and project-management processes of the carrier. If they add new services, such as Wi-Fi or enhanced data applications, we need to understand what that will bring to billing from a business and technical perspective, says Dooley. So they need to determine at what point they want to bring their outsourced partner into their discussions, to ensure their rollouts are backed up with the right resources and commitment from us.

To adequately become an extension of a carriers business planning team and to support those new rollouts, Convergys will staff up to the level the operator is willing to fund, and dedicates resources and people for its larger clients. It also has a bench of multiclient professional services personnel, available to fill in if necessary.

Outsourcers often find themselves assuaging the fears of nervous carriers; giving access to the inner workings of service launches and other proprietary information to a range of people outside of the organization takes a leap of faith. In Convergys case, there are nondisclosure statements, carrier-dedicated teams are separated on different floors, different clients are not allowed in the same room at the same time, and corporate guidelines promote confidentiality, including pro-hibiting employees from leaving any files out on their desks when they arent there.

Convergys Corp.
CSG Systems Inc.
CustomCall Data Systems Inc.
ILD Telecommunications Inc.
OSG Billing Services

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