Intelligent Pricing Solutions Critical in Data-Crazy World

By Amit Daniel

The recent "Pricing Mobile Data" conference in London was perfectly timed to address the concerns of many companies in the communications arena looking for ways to drive revenue in a continually evolving industry, in particular, the huge growth in demand for mobile broadband data. To give you an idea of the scale of growth, a CISCO VNI report claims that mobile data traffic in 2011 was "eight times the size of the entire global internet in 2000." Many companies have prepared for this growth by investing in LTE networks and data technologies, and they must now monetize these new networks to recover their investment.

I found the theme of the event – "Differentiating services through innovative charging & simplified billing" – to be refreshing as it focused precisely on an issue that everyone in the industry is dealing with in one way or another. Mature market trends are providing important lessons for players in the developing markets and in some cases even providing them with innovative solutions and strategies. They know, for example, that data is the future and that it is growing increasingly complex in nature. They also know that offering unlimited service packages is not a sustainable solution for retaining subscribers and that an essential ingredient for differentiating themselves is an agile solution that optimizes their pricing capabilities, allowing them to offer the best experience to their increasingly sophisticated customer base while assuring minimal revenue dilution.

As a specialist in Pricing and RA, we were thrilled to hear about operators who were ready to get creative in dealing with new developments. OTT (Over the Top) applications penetration was a big talking point, especially the latest downward spiral in SMS revenues caused by the OTT player WhatsApp. With data now becoming the main source of income, KPN Netherlands, for example, havs rebalanced its tariff, making data the main package attribute with voice and SMS as add-ons at lower fees. Another example is Verizon, which, like most other companies, will not be offering unlimited data on the new LTE network. Sonera, however, takes the prize for succeeding in differentiating the brand with an exclusive bundle offer to attract younger customers that includes a premium Spotify account. 

Talking to these operators, we concluded that they need an intelligent pricing solution that provides strategic and wise automated pricing decisions. No matter if operators are retreating from the unlimited scenario or partnering with OTT players, their strategy must include adopting a solution that provides them with detailed customer knowledge and real traffic and usage patterns history. This knowledge will allow them to best connect to their customers by offering them the most suitable packages, keeping them connected and satisfied.

Amit Daniel is heading the marketing, product management and business development in cVidya. Prior to joining cVidya, Amit worked at Starhome for the last 12 years as VP of marketing & business development.