When It Comes to Bill Shock, Enterprises Get Zapped

In April, we reported on results of a joint survey Matrixx Software did with Stratecast about the seriousness of the bill-shock problem in the enterprise space. The problem has not abated, so we spoke with Matrixx CEO and founder Dave Labuda about it. Labuda also will touch on the topic of bill shock in a panel discussion at B/OSS Live! on Wednesday on innovations in billing and charging for the cloud.

The session will explore ways for operators to leverage charging and billing platforms to bring new usage or QoS-based pricing, spot-market pricing and cross-product discounting business models to market. The panel will discuss how pricing models are evolving, the potential for bill shock in the cloud and how to leverage new hosted charging and billing architectures to charge for the cloud “in" the cloud.

Matrixx recently released its Enterprise Spend Control solution to help alleviate a problem that has grown to 10-15 percent of total enterprise revenue lost and $20 million more in write-offs per month.

B/OSS: Why target the enterprise with spend controls?

Dave Labuda: It isn’t that we aren’t targeting retail subscribers because the advantages of our products apply across the subscriber base, but with the enterprise specifically there is a tremendously increased risk of not having control because people aren’t spending their own money. And we know where that goes. These users tend to be high-travel, high-spend users. The technologies that have been in the market traditionally just absolutely cannot meet the requirements to provide real enterprise spending control. So it is an area where our technology differentiation puts us [forth] as the only game there is in this arena.

B/OSS: There are other policy solutions in the market that focus on bill shock and price control. Why is yours different or the only game in play?

DL: If you look at the convergence of the two halves of the market from a solutions standpoint, you have historically had the network-based solutions and most of these short-term bill-shock solutions were more parking-meter, network-based solutions that do not have the flexibility and the complexity or capability to deal with enterprise relationships where you can have tens of thousands of subscribers in complex hierarchies. At a large company, people are coming and going on a daily basis. And you need entirely self-management-oriented solutions. Historically, those subscriber management capabilities have only been available in big-server, batch solutions. Because of the technology we have built, we can run with the network in real-time with network grade capability and at the same time provide complex business capability in real-time. The icing on the cake is that our technology allows us to track any aspect of the usage or the spending of all those devices in real-time all the way up the tree.

With all these employees incurring charges at high volumes, we can also provide notification and limits at the department level, the division level and even the corporate level. And we can do it, transactionally, in real-time. A system that’s built on a traditional database just can’t do that. The transactional chaos that would occur from trying to update al the counters and balances all the way up the tree just prohibits them technologically.