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BIMS PREVIEW - Billing & Information Management Systems 2007
Hugh Roberts sets the scene for BIMS 2007
Whether you prefer to call them ‘silos’ or ‘stovepipes’, the history of telecommunications has been dominated by the development of vertical towers. Within the traditional telecoms operations environment, every new service created a new conduit from network to subscriber, creating new systems and processes from customer order to trouble ticket via provisioning, billing and termination along the way.
The first wave of activity in the 90's (BPR initiatives notwithstanding) focused on systems consolidation. Incumbents (and ex-incumbents) with 200+ billing systems realised that to compete they needed to cut costs and IT headcount, and – more to the point – could potentially achieve a more consistent 'one-touch' view of their customers at the same time.
Since the Millennium, the second wave of functional consolidation has had to face up to the challenges of systems convergence head on. In addition to the natural desire to simplify operations by integrating disparate business units and functions, the demand for innovative content and eCommerce services to create new revenue streams has complicated both business and operational environments and relationships.
We are now entering the third wave of industry consolidation, where the convergence of market sectors no longer respects traditional boundaries. In the light of reduced margins for traditional services, fixed wire, mobile, cable, satellite and third party brands have all sought to extend their virtual or physical service footprint to achieve ubiquitous market presence and maximise the leverage of their customer ownership. At the same time, new technology platforms have evolved, creating competition from unexpected quarters.
M& A activity is creating – where regulators will allow it – larger operators and vendors that own or provide a greater proportion of the communications infrastructure. Where direct ownership is impossible, virtual service extensions – through MVNO strategies or otherwise – are now presenting customers with full multi-play offerings. However, this apparently inexorable evolution has masked some critical aspects of the underlying market reality:
1. Corporate competition between technology platforms at the network layer, each with its own mechanisms for customer access, is not sustainable. Increasingly, customers don't want it, and neither do regulators.
2. The 'bitpipe' business model based on multi-channel infrastructure ownership will be very profitable, but as a high volume low margin business, will only be sustainable if it can remove the need to financially support a consumer-facing brand.
3. Multi-play offerings, by their very nature, change customers' perceptions and expectations of the interaction between the branded elements of their overall communications (and entertainment) environment. This in turn will lead to changes in the fundamental relationships between service providers, third party content and financial brands, and the suppliers of their hardware and software.
All of these factors, plus the attentions of the EC Commissioner Viviane Reding, makes structural separation inevitable. It is simply not realistic for network infrastructure owners and communications service providers to continue as integrated entities. The question therefore arises… to which tier in the new horizontally defined 'divergent' environment will the various elements of operational and business functionality need to migrate?
Silos clearly won't work, but then neither will the anticipated tight coupling of the OSS and BSS layers, particularly when considering the integration of new development areas such as customer 'attention data'. This is the debate we need to be engaged in – how do we correlate, filter and share all of the data we can now generate? The repositioned 'telcos' (and their business models) that turn out to be successful will be those that actively contribute to a value chain that can collectively achieve effective information management.
Hugh Roberts will be co-presenting the 'Keys To Establishing A Successful MVNO/E Business' Seminar with colleagues from Logan Orviss International on June 5th, as well as running the 'What's New In Billing?' free Tutorial.
You can visit the Billing & Information Management Systems Exhibition (7th – 9th June 2007) free of charge if you register online at www.iir-billingsystems.com/exh.
Billing & Information Management Systems
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