Realizing the revenue potential of wireless data
By David Adams, Product Manager, Casabyte
There is a growing awareness of the importance of Revenue Assurance within the wireless telecommunications industry. The viability of an Operatorís business plan increasingly depends on capturing all of the revenue from their subscribers. This is driven by large investments for new spectrum, technology upgrades and new data services. It is critical to ask "Can I identify and capture the revenue I am losing?" Another driver for Revenue Assurance is liability concerns for over-charging subscribers. A Revenue Assurance Test System is a premiere solution for these concerns. This is demonstrated in an examination of a robust test solution with a broad coverage of revenue loss areas and billing accuracy, and a review of a real world case study.
Are the services billed correctly?
Revenue Assurance requires Operators to verify the accurate creation and processing of billing information. This ensures that the services used by subscribers are accurately reflected on their bills, including the applicable tariffs and the committed contract. It also ensures that bills do not reflect service that should not be billed (dropped calls, failed downloads, lost messages, etc.). Billing information is based on many factors, including the type of service, the amount of time or data used, and the subscriberís selections (accessing voice activated services, downloading a game or ring tone, exchanging corporate e-mail, etc.).
With the proliferation of new data services, there are many characteristics that increase the incidence of billing problems: frequent additions and changes in offerings, new and additional billing systems, unfamiliarity with event and content based billing, "converged" billing systems, etc.
The affect of service quality on revenue recognition is often not as well addressed. When subscribers encounter services that do not work correctly or have an unsatisfactory level of perceived performance, the services will not be utilized and charges will not be incurred. Clearly, service quality must be managed in association with revenue assurance.
Revenue assurance via testing
While various processes make a contribution to Revenue Assurance, it is - service usage from the subscriberís view" that is receiving the most attention among Wireless Operators. Test Systems are available that emulate the subscriberís service usage within the operational network, and check the corresponding billing records. These are completely automated and under the direct control of the groups who validate the billing process and measure the quality of service. Though these techniques are comparatively new to Operators, they are becoming a priority across the industry for completely understanding and managing Revenue Assurance and QoS (service quality).
Successful use of this measurement approach is based on a system that (see below):
These solutions emulate a subscriberís usage of service, create records of that service and compare those records with the actual records created within the Operators network. This approach must have:
- Utilizes "typical" subscriber terminals (reliable, widely deployed) for making measurements; this closely reflects the userís experience as they access services over the entire network ("end to end")
- Uses computer-based, unmanned remote units to achieve the highest quality measurement process; automating the measurements avoids human errors commonly associated with a manual procedure (execution mistakes, timing irregularities, recording information, etc.)
- Integrates sophisticated software to emulate subscriber activity on the terminals and to measure the service quality
- Deploys the units throughout the network coverage areas
Addressing the top revenue leaks
- A broad coverage of the physical network, the services offered to subscribers, the subscriber types, and typical subscriber activity
- Sufficient granularity of control to create the range of situations experienced by real subscribers
- Complete records of the service with all of the required content
How well can this approach address the real world problems leading to "lost revenue" within an Operatorís network? A recent study by Phillips identified the "areas of leakage" that are regularly experienced by Revenue Assurance groups (see Figure 1, from the 11/2003 Janney Industry Report). A valid testing approach identifies loss in these areas, leading to prevention and revenue recovery.
1. Records too late, failed record creation, lost records, and file errors 38%
The factors that cause these problems are vast, spread across numerous systems which are subject to frequent change (software updates, configuration changes, etc.). Records that cannot be processed in any element in the chain are "set aside" and do not get processed on time, causing them to be "late" or "lost" altogether. In other cases, the records are not created or get corrupted by subsequent "file errors," and the bill does not reflect the usage.
By creating scenarios that emulate the causes of these problems, the testing process identifies which service records are not created correctly in a timely fashion and accurately reflected on the bill. Regular and comprehensive testing is required, since these problems occur frequently, usually under the oversight of work groups that do not coordinate their tasks.
Example: A Switch software change that puts "different content" in a CDR field for caller ID blocking features may trigger the mediation device to send this record to the error file, and thus cause it to be sent to the billing system late or never processed. If the record is passed along, the value may not be accepted by the billing system.
2. Corrupted calls 8%
A service that is not provided successfully means the subscriber should not be billed in the same way. This demonstrates the linkage between quality of service and revenue assurance. Services that are "corrupted" prevent charging for the impacted service, contribute to the subscriberís lack of use of the service, and could lead to churn. Conversely, serious legal implications (such as a class action suit) can result from over-billing subscribers and amassing an unknown liability.
A capable testing process creates many of the "corrupting" events that subscribers experience. This ensures that the Operatorís system handles corrupted service properly. Moreover, a thorough testing strategy creates service usage that naturally encounters the real problems, in the same way that subscribers do. This produces an accurate measure of revenue lost from poor service quality, and detects revenue impacting problems sooner, thus limiting the impact. More importantly, it detects situations of over-billing.
Example: A regular threat to revenue from SMS based services is the congestion that SMSCs experience, and the subsequent slow delivery or loss of messages. Performing a well-planned test campaign (good coverage of geography, service offering and time) quickly highlights service quality degradation before the revenue impact becomes substantial. Simultaneously, the lost revenue can be calculated.
3. Incorrect rating 10%
Determining the final charge for service is a complicated process that is highly prone to errors. This results in under-billing as well as over-billing (each with its own consequences).
A test system creates service usage that covers the "rating" related aspects, and keeps thorough, useful records (with the information required to determine the charge). The records are compared against the networkís own rated records to determine discrepancies. Automating the comparison provides timely problem detection and minimizes the revenue impact. This is enhanced if the actual rating values are predicted, but this requires a great degree of sophistication (taking into account all factors contributing to the rating process: rate plans, billing cycles, taxes, etc.).
Example: Certain services incur "premium" charges, such as roaming outside the home network. While this area experiences the standard problems of revenue assurance, certain features complicate this process; i.e. ensuring that services are billed at the roaming rate when forwarding from a home mobile to a roaming mobile.
In similar fashion, Incomplete Customer Records and Fraud can be addressed (Debt Write-Off is not suited to this approach).
Case studySo, how does this translate to the Revenue Assurance experience of Wireless Operators? Numerous Operators have seen their Revenue Assurance process transformed using the approach described in this article. Typically, Wireless Operators start with a manual process for testing billing accuracy:
- Regional groups across the network with many employees involved
- "Bag of Phones" approach, requiring travel to many sites and after-hours work
- Test Plans in Excel spreadsheets, averaging 150 test calls
- Results recorded by hand on paper
- Manual comparison of the results.This provides limited coverage of network changes, time, geography and technology - factors that impact billing accuracy. The process has the inherent characteristics of manual activity (inconsistencies in execution, errors in records, difficult to maintain, etc.).When implementing a Test System approach, Revenue Assurance groups develop a network wide, standardized approach where:
- Anyone in any location can test any other geographic area
- The costs involved in each test is reduced by 95%
- The frequency of the measurement is increased 10 times, with 40 times the measurements
- Fewer people with lower skill requirements are required
- Skilled people get to the trouble resolution phase instead of travelling and testing.The bottom line results are dramatic:
- The efficiency of measuring the billing accuracy and the quality of service is transformed, and yields improved quality of tests and test data
- Revenue impacting problems are detected much sooner, problems are fixed quicker, customers are happier and revenue is preserved.
For more information:
Please contact: Bill Lang, Vice President of International Business Development, firstname.lastname@example.org
Or visit: www.casabyte.com