Transformation, Convergent Charging and Ericsson/Telcordia

To truly capitalize on the rapid market shift from delivering siloed, discrete, network-based services to delivering an array of applications and content over a converged infrastructure, communications service providers have an imperative to undergo an operational transformation in the OSS and BSS systems that make service creation, management and delivery a profitable and differentiating exercise. It’s a confusing time for service providers, who are determining how best to be positioned to take advantage of what customers want (personalization) and are willing to pay for (the jury is still out).

So it’s unsurprising that transformation is one of the biggest focus areas for B/OSS Live! this year, and it’s also the theme behind our new Report, “Managing the Operational Transformation Imperative: A Pragmatic Approach to Strategic Operational Change." The Report, underwritten by TEOCO, takes a look at the forces behind CSPs’ need to adapt and evolve operations – preferably, in a pragmatic fashion. This Report takes an insightful look into the solutions and decisions needed in order to support these operational and strategic changes.

This week at B/OSS Live!, the subject of transformation is also front and center. A full educational track on business optimization takes a look at how billing and charging have led the transformation of business support systems into key competitive weapons. New dimensions of time and place and content consumption across lines of business have made keeping pace with the developments in BSS a necessity. This track will highlight why service providers need to revisit their notion of billing and business operations and continue investing in the flexible features that will help them compete in a real-time, personalized world.

We’re not alone in looking at this shift. Infonetics Research just released a report on convergent charging services (consulting, integration, hosted/managed services) and convergent charging software that can handle multiple payment methods, such as prepaid, postpaid and hybrid prepay/postpaid models, across service types (voice, video, data), network types (wireline, wireless), and regions.

"Operators are constrained by their existing billing systems, both IN-based prepaid systems and batch billing systems for the postpaid market," said Shira Levine, Infonetics Research's next-gen OSS and policy analyst. “Convergent charging represents a way for operators to deliver new services and offer new pricing models without embarking on full-scale billing transformation projects, and can actually be the first step in a gradual migration project.

The global convergent charging market, including software and services, grew 37 percent in 2010 over 2009 to $862.3 million, and is forecast by Infonetics to grow to $3.3 billion in 2015. Though the convergent charging opportunity is primarily a wireless one, some wireline operators are experimenting with multi-service convergence, including cable operators delivering quad-play with added mobile capabilities, wireline broadband operators offering their IPTV subscribers access to prepaid video-on-demand content, and fixed line operators supporting their cloud strategies with convergent charging capabilities.

“While initial growth in convergent charging has been in emerging markets such as Southeast Asia, India and Eastern Europe, we're seeing early investment in more mature markets, including western Europe," Levine added.

Telcordia and Comverse are now neck-and-neck in the overall convergent charging market, with Telcordia slightly edging past Comverse in 2010; Ericsson and Huawei are third and fourth, respectively, with Ericsson obviously in a position to leapfrog into first place with its Telcordia acquisition, announced Tuesday.

The Telcordia/Ericsson deal is unlikely to be the last megamerger that we see, wither. Levine said that there will be increasing demand for integrated policy/charging solutions that enable operators to offer more flexible pricing models, such as variable pricing based on time of day or the subscriber's location; this trend will drive continued M&A activity between vendors.

So we look forward to many conversations throughout the show on shifting operational approaches, Ericsson/Telcordia, and the business of carriers’ businesses. We hope you do too.