Ever download a ringtone advertised on a TV commercial and then notice you’re hit with a big charge, sometimes even a recurring one? It would have been nice to know that was coming but most of the time, such details are obscured in fine print. Heck, sometimes mobile subscribers see charges for services they’re sure they didn’t even order. If the situation sounds familiar, that’s because it is.
Several years ago, the industry saw the first iteration of the problem of content billing. Back then, it was cell phone users placing orders over the Web or their phones. The problem has taken on a new form — as evidenced by the recent lawsuit against mobile publishing firm Cellfish — and the culprit now, says one billing analyst, is mobile content.
So what can service providers do to minimize unclear or even fraudulent charges on their subscribers’ bills? More to the point, how can operators make the money off mobile content, instead of letting aggregators use them as dumb pipes to make all the dough? Shira Levine, directing analyst of next-gen OSS and policy at Infonetics Research Inc., has some thoughts on the matter. Here is the edited transcript of her conversation with B/OSS Business & Regulatory Editor Kelly Teal.
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| Infonetics' Shira Levine |
KT: This problem between billing aggregators and service providers isn’t new. Why are we seeing a second wave now?
SL: It’s really the mobile content wave that’s driving this. Consumer interest in mobile content is definitely on the rise and most operators just haven’t, especially in North America, figured out how to handle mobile content. The traditional model has been the walled garden. But then providers realized the demand for off-net content and they secured relationships with aggregators so they wouldn’t have to worry about everything. But there’s no accountability. There’s no direct billing relationship, no QoS management, and providers are really at the mercy of third-party content providers to provide the right information so they can bill their customers.
What I think is going to come back and bite providers is what shows up on the subscriber’s bill from the carrier. Regardless of who the content is coming from, the first place a subscriber is going to call is the carrier. Even if the carrier says, ‘It’s not our problem,’ they’ve wasted call center resources and ticked off or even lost a customer.
KT: What might be the solution?
SL: Carriers need to take more control of their third-party relationships. We see this in areas like app stores. Carriers that offer those understand that they need to take a more active role in content delivery. They’re at least minimizing some of those billing errors and maintain end-to-end QoS, ensuring the content the subscriber gets meets certain quality parameters. But for providers that still outsource for content, one way to minimize problems is more stringent SLAs with the content provider or the aggregator.
KT: So carriers are overlooking some big revenue opportunities?
SL: Yes. The appeal carriers traditionally have offered is the pipe and the access to the customer — they’re just the conduit. But providers also have assets like information on their subscribers, usage information, preferences. There’s a huge trove of data that’s basically untapped. So being able to provide third parties with information on how to market to their subscribers is valuable. That information can be sold, it can be monetized.
