Service providers must address the opportunities and requirements of mobile entertainment throughout the entire content value chain, says Dr Graham Carey

The idea of delivering content on our mobile handsets is not new. For the last five years, 'power users' have downloaded text-based weather, travel and news information from mobile Internet or WAP sites. Those of us brave enough to try these services were either 'in the business' or the classic technology enthusiast. The user had to have patience and be persistent, subscribe to 2G data services, and have the latest WAP enabled handset. They also had to be forgiving of the seemingly ever-present technical glitches that would occur.
Today, things have become far more advanced. As the market moves from a technology-based to a consumer-driven market, these early adopters are being joined by mainstream customers looking for meaningful services that are instantly available and competitively priced. The desire for relevant services has replaced the technology as the primary motivator to adoption. While handsets remain a significant consumer fashion drive, for both consumers and service providers, it is now more about the range of services being delivered, how they are bundled and priced, and delivering value that is important. As this content market matures, new commercial realities are kicking in as users' expectations are increasing. Customers are increasingly fickle, loyalty to service providers is low, value is at a premium.  Furthermore, as consumers  become increasingly sophisticated, they know where and how to find a good deal.
The content asset management system must be able to deal with ingestion, cataloguing, search and discovery whilst the content delivery eco-system must address critical issues including content repurposing and rights management. Rights management is not just about digital rights but also about knowing the legal rights to distribute and deliver content to different devices and different geographies. Added to this we must also know what royalties are payable and to whom for any consumption. On top of these complications we are also seeing the emergence of more services that require real  time transaction and payments. For example with the rise of on-line gambling it is important that the e-wallet of the consumer is managed in real-time. This e-wallet could be a separate account or it could in fact be part of an entertainment balance within a wider portfolio of balances that the user has access to via the service provider. Interactive gaming is another example where real-time transactions and balance updates will be important. Resources used for a game, which may not always be money-based, would need to be updated and managed for the user in real-time. Whatever the combination of balances and bundles, it is clear the consumer has multiple options and it is critical that we are able to track and bill for all of them. In summary, to make money in these extended and more complex value chains, all the revenues must be tracked and monitored as they happen.
Monetising content and value added services – and making sure each member of the value chain is compensated – is critical. To grow services and deliver value to the consumer, service providers must focus both on the content delivery and on the comprehensive order-to-cash process while proactively managing these new revenue streams. This requires more than simply charging or billing for a single piece of content. It is all about handling the complete revenue management lifecycle.
Billing and Revenue Management systems must address bundles of content from various sources, price content individually and/or as part of a wider bundle, instantly offer deals and promotions at the time of service consumption, and allow the user multiple and convenient ways to pay. As the service, content or bundle is delivered, the user must be charged and the service contributors and partners appropriately compensated through automatic settlement and remittance.  The mobile content arena will also have to address sponsorships and advertising with real-time deals and promotions. 
Managing revenues associated with the delivery of new media content is not an entirely new concept.  Forward thinking service providers including Orange UK, Vodafone Live!, Telenor, Swisscom, as well as some ISPs, media companies, and broadcast networks have been more sophisticated in terms of how they view the entire revenue management lifecycle for mobile content.  Companies such as these are able to offer innovative and exciting pricing models and, as a result, are no longer limited to selling a mobile or Internet game based simply on the file size or some other physical parameter. Instead, they have the ability to charge in real time for a service based on other considerations such as the number of transactions or usage.
For example, in an interactive gaming session the winner could be allowed to play the next level of game for free. Similarly, free music downloads provided by a concert promoter could be made available prior to a concert and, by integrating music downloads and rights permissioning, the music could then be restricted for play after the event only if the user either purchases the rights or attends the concert. The model could be extended to encourage further purchases by giving discounts based on today's purchase for future downloads or service consumptions.
Peer-to-peer marketing and super distribution represents another potential opportunity for revenues in the content value chain; because the latest standards for DRM allow super distribution, users who act in an 'originator' capacity can instantly claim affinity points or monetary discounts on their accounts when sharing and locally distributing content, in effect becoming a new channel partner for revenues.
As mobile entertainment moves to more sophisticated market-driven users, service providers must address the opportunities and requirements throughout the entire content value chain in an easy-to-understand manner. Properly handling the revenue management lifecycle in real-time is absolutely key to delivering these mission critical, and highly strategic, revenue generating services.                             

Dr Graham Carey is Director, Industry Solutions, Communications Global Business Unit, Oracle

While adult mobile content presents a potentially lucrative avenue of revenue for operators, regulatory and marketing pressures have so far prevented them from engaging with the market fully, as Tom Erskine explains

With the explosive growth of mobile content, operators expect their revenues also to grow, as the subscriber appetite for content increases. Gaming, search, personal navigation and music markets are booming, and SMS and MMS messaging are now commonplace. Mobile operators now face increased competition as MVNOs enter a saturated marketplace, trying to attract subscribers with their specialised content offerings. 
There is one area in which many mobile operators have been reluctant to associate themselves, yet it remains one of the fastest growing areas for revenue: adult mobile content. Content providers are poised and ready to offer this content, but have found markets (especially the United States) tough to penetrate, as mobile operators have worked hard to distance themselves from 'racy' offerings.
The market for mobile adult content is estimated to grow to $90 million in the United States and $1 billion globally by 2008, according to Yankee Group, a Boston-based independent technology research and consulting firm. And recent figures from Jupiter Research predict that mobile adult video is expected to outpace text messaging by 2009, generating nearly $2.7 billion annually.
With such high financial projections, mobile operators can no longer ignore this revenue stream. Rather, they need to consider offering solutions and services to capitalise on the demand for this content without damaging their brand equity.
Historically, adult content on mobiles have carried a stigma from various outside pressures. There is the social and cultural stigma of downloading and viewing this type of content, and there are regulatory bodies placing controls on everything from radio to TV. Now, mobile is no exception.
This content may be more pervasive than originally thought. The latest US government-commissioned study found that about one per cent of web sites indexed by Google and Microsoft are sexually explicit. The study also found that the strictest filters were able to block 91 per cent of sexual explicit web sites in indexes maintained by Google and Microsoft's MSN.
With the evolution of adult mobile content comes increased pressure from outside stakeholders, like government and concerned parents, to control and restrict access. Mobile operators must offer tools for improved access management for the ever-growing mobile teen market (12- to 17-year-olds) and the 'tween' market of 8- to 12-year-olds.
Inbound or outbound, the threat among these age groups is mounting.
• Outbound: Harmful contact and content is available with free browsing and third-party access to illegal or inappropriate sites, including adult content, adult gaming and gambling web sites.
• Inbound: Inappropriate blogging, solicitation,        spamming and adult-oriented marketing is pushed to subscribers.
Despite the fact that the access is at the subscriber's discretion, it is usually the network that is deemed the responsible party. The question is no longer when but how to deliver effective, easy-to-use access and content controls that satisfy subscriber and consumer concerns, as well as operators' needs to grow revenue.
Internationally, government bodies have been regulating mobile content on various levels of restrictions with some success.
The United Kingdom has a co-operative 'Code of Conduct' that was introduced in January 2004 for the categorisation and filtering of content.
The International Mobile Classification Body (IMCB) was introduced later in 2004 to set a Classification Framework for commercial mobile picture-based content.
Italy also has a 'Code of Conduct' although entirely voluntary on premium services and children protection, which was signed by major mobile operators in February 2005. 
Israel has taken it a step further with the Communications Ministry mandating the use of filtering of mobile content to protect local youths.
In the United States, the Federal Communications Commission (FCC) is requiring solutions on mobile content under an industry security rating initiative, and the Cellular Telecommunications Industry Association (CTIA) developed a set of voluntary guidelines in 2005 around offering mobile adult content. Individual state governments are driving more legislation. 
For mobile operators, it's not just a matter of filtering this content. Many filter solutions on the market today aren't dynamic enough to keep up with the development of new adult sites. The technology is available, but operators need to choose their solution provider wisely. Things to consider:
Verification: Age verification and age registration are not easily monitored nor controlled on a prepaid phone. In addition, mobile operators are struggling with     administration of a blacklisting service to provide better filtering solutions.
Support: Support is needed across multiple touch points for each subscriber or groups of subscribers. How does the solution handle browsing filtering, SMS, MMS, International Gateways, internal and third-party content servers all at the same time?
Service Quality: Does the solution impede the subscriber experience, slowing down the performance or interaction and preventing subscriber usage, thus decreasing potential mobile operator revenue?

Striking a balance
The answer is to strike a balance among preserving the subscriber experience, minimising operational concerns and adhering to inevitable regulatory controls of government bodies.
Mobile operators have an opportunity to take the lead on addressing the concerns on adult mobile content by providing subscribers with content controls as a value-added service to support subscriber growth and to build loyalty.
Access management creates new market opportunities that can drive subscriber acquisition and revenue growth. Subscribers are able to configure interfaces depending on their preferences for management and reporting purposes. What's more, the marketing opportunities are endless.
How can mobile operators capitalise on such revenues without soiling their reputations with more explicit offerings? Forward-thinking mobile operators and MVNOs are taking advantage of vendor-provided solutions that address this nascent challenge. Meanwhile, content providers looking to profit from adult content continue to rely on subscribers to get it the old fashion way; by digging out their credit cards for impulse buying. This approach leaves operators safely on the sidelines – and out of the revenue loop.                               

Tom Erskine is Vice President of Product Development and Marketing, bcgi.  www.bcgi.net

For IMS to really take off, solid OSS structures which underpin the technology are imperative, as David Sharpley explains

The concept of converged networks and services is becoming a reality as IP Multimedia Subsystem (IMS) technology gains attention and acceptance in the communications industry. With IMS, service providers can enable their customers to mix multimedia service components – text, pictures, voice and video – over a single connection. IMS provides the Internet Protocol (IP) multimedia and telephony core network that supports IP-to-IP sessions over both wireline and mobile networks. Additionally, IMS includes session control, connection control and an application services framework along with subscriber and services data. 
Ultimately, IMS has the potential to create a fluid environment where users can combine and recombine existing individual services in real-time. And it will enable service providers to generate new revenues by quickly and economically moving through the service creating and deployment lifecycles.
To take full advantage of this new revenue opportunity, service providers must either enhance their existing Operations Support System (OSS) solutions, or introduce new systems. Effective support for IMS requires new OSS capabilities, configuration approaches and integration mechanisms. The OSS stack must provide:
• Unprecedented simplification and abstraction of services and the network;
• Simplified support for the underlying network infrastructure, which changes as IMS is deployed;
• A flexible Service Delivery Platform (SDP)to support rapid service creation lifecycles and reduced time to market; and
• Increased capabilities for managing service profiles and subscriptions directly into the application layer.
With a common Session Initiation Protocol (SIP) and MultiProtocol Label Switching (MPLS)-based core network, various access technologies can be enabled with the same control plan intelligence. Moreover, service providers can deliver seamless access to the same services residing in the application layer.  Session handling, service orchestration and processing are kept in the higher layers. By doing so, they are decoupled from the network equipment. This architecture allows service providers to exchange one network access format for another and to switch between the formats on the fly with uninterrupted session handoff. 
The functionality of IMS makes it a key enabler for Fixed Mobile Convergence (FMC) by blurring the lines between the historically separate worlds of wireless and wireline services. FMC ultimately leads to a seamless, unified offering that intelligently hops between fixed and mobile networks to offer the best service and reception possible, with the most efficient use of network resources available.

IMS OSS challenges
While the benefits of IMS are obvious, there also are a number of challenges. These challenges include interoperability, availability of complete solutions and a clear business case for the technology. As a result, service providers may be quick to endorse IMS in theory, but are cautious in their implementation plans.
New IMS deployments must interwork with existing circuit-switched and packet-switched networks. IMS is also driving new requirements in the OSS arena. In fact, well-adapted OSS systems will become essential to help unlock the value in IMS, as service fulfilment and management requirements become more dynamic and sophisticated.

Plug & play support
As IMS becomes more widespread, new equipment will be needed. Traditional vendors are reworking their products, while new entrants focused solely on IMS products are entering the market. The result: a proliferation of devices from multiple vendors that may not offer complete functionality. In this environment, interoperability becomes a key concern.
To keep up the pace with these equipment changes from an OSS perspective, service providers must be able to easily drop in new device drivers for each piece of IMS equipment they select. Similarly, the provisioning logic for each new service must be easily managed as its own entity, without affecting other services and must provide abstraction from the network in much the same way IMS abstracts control and application services from the network. The technical ability to provision, model and collect billing records from these devices is crucial to the deployment of revenue-generating, commercial IMS-based service offerings.

Simultaneous support
OSS functionality for next-generation IMS services should coexist with the OSS for mature existing services. Underlying OSS platforms should be consistent in design, operational and architectural consistency, which will allow for an easy transition into a high-volume and fully automated production environment when the business conditions allow. Plug and play service and network OSS components must be well defined and partitioned from one another to allow easy revisions to individual configurations without affecting other deployed capabilities. Furthermore, rather than only permitting coexistence, OSS abstraction must facilitate migration of legacy service implementations to the next-generation network with little, or no impact, to the network operator's front office or to the end user.

Time-to-market needs
IMS is expected to spawn the introduction and proliferation of innovative new services. In such a dynamic market environment, service providers need an OSS that gives them the agility and control to define, deploy and refine new IMS services quickly and at low cost. Ultimately, this flexibility must be combined with the scalability and robustness of an OSS solution that can scale to handle high-volume, mass-market services that are anticipated for the future.

OSS and SDP
The OSS must support the entire service lifecycle – from service incubation to product maturity. Service creation includes not only defining the service itself, but also defining the OSS stack behaviour for fulfilment of new service requests. OSS capabilities must interface with the  IMS network architecture layers at run time, as well as the SDP environment at design time. Existing services configured in the network should be exposed to the SDP for re-use and re-assembly, in the manner of a Service Oriented Architecture (SOA). Similarly, SDP tools should have the ability to reach into OSS design-time tools for reconfiguration and new service deployment.
OSS applications will need to address the changing requirements driven by IMS in the control, policy and application planes of next-generation network architectures. In this scenario, more focus is placed on service definitions and profiles, service subscriptions and application layer service provisioning. Physical and logical inventory expands to service inventory and service capability management. Network provisioning and activation broadens to service profile management, subscriptions updates and instantiating application layer services for customer consumption. Billing becomes more customer- and service-oriented, requiring new ways to process usage records in order to achieve desired pricing models.

Policy and control
The intelligent control and policy functions built into the IMS network will create a more fluid environment where service behaviour decisions can be made instantaneously.  As a result, OSS solutions will be more tightly integrated into the network because it plays a critical role in service delivery. This shift will raise the bar for OSS reliability, availability and performance. Standards-based, open APIs working into a SOA are critical for achieving the OSS interoperability, flexibility, reusability and time-to-market capabilities needed for the IMS environment.
The success of IMS hinges on the ability of service providers to attain business value from its deployment. Service provider must capture the revenue stream from the service innovation promised by IMS, while customers will require flexible pricing schemes. Billing systems capable of charging subscribers for new services in unique ways will be supported by enhanced charging mediation capabilities with advanced functionality not present in legacy applications.
IMS-based services require a mix of session, event and subscription-based service pricing, including revenue sharing with partners. Billing for service and network usage means collecting and processing usage information from a heterogeneous mix of network elements at multiple layers in the network.

IP domain capabilities
IP forms the foundation of the IMS network. Effective OSS platforms must, therefore, feature strong domain capabilities for these requirements. OSS systems with insufficient IP capabilities will not be viable in an IMS-based world. Rich out-of-the-box service support for key enablers, including MPLS IP Virtual Private Networks (VPN) in Layer 2 and Layer 3 and IP Quality of Service (QoS) using policy-based networking techniques, are key to establishing the connectivity and network-level services at the core of the IMS network. The IP OSS should provide a combination of abstracted, multi-vendor IP service activation, along with discovery, configuration management and integration with service assurance tools.
 Today, service providers must consider a single, comprehensive service provisioning platform that can be leveraged in the long-term as IMS evolves. An effective OSS for both existing and next-generation services must offer a full range of provisioning and activation capabilities. These capabilities range from the traditional tasks of setting up the network infrastructure and connections, to the provisioning of service subscriptions, high-volume real-time customer service profile updates and application layer services. This type of flexible OSS platform provides both the horizontal scope of interfacing with virtually any type of network equipment and the vertical scope to seamlessly bridge all three layers of the IMS architecture.                               

David Sharpley is Executive Vice-President of Marketing for MetaSolv Software, Inc.

Operators must take a longer-term view of IMS, which should be seen as a foundation for future growth. And billing will play a significant role in its development, says Andreas Freund

It may seem that IMS has gone from being 'the next big thing' to the proverbial white elephant in just a few short years. The truth is, of course, somewhere in between, and there are signs that the European telecoms community is at last looking at the reality of IMS rather than simply believing the hype.
One popular misconception has been that IMS is the killer application itself rather than simply being the environment that will enable those killer applications to flourish. At its very simplest, IMS is nothing more than a roadmap and standard architecture that will allow fixed and mobile operators to provide new multimedia services.
These standards impose a logical architecture that makes it cost-effective for operators to rollout new and increasingly personalised services in their networks without disrupting existing services and capabilities. It also acts as the 'glue' that will combine the services, security, billing, interoperability, access and transport elements together to make such services more accessible for end-users and more profitable for carriers.
In an environment where 'data services' still usually means SMS for most mobile operators, the list of lucrative-sounding new services made possible by IMS has been one of the main reasons for the hype surrounding it: real-time video sharing (RTVS), personalised location and presence-based services, next-generation voice services (Push-to-Talk over cellular, mobile VoIP), multimedia conferencing (group chat/audio/web/video conferencing), multi-party gaming, personalised information channels and services. The list goes on.
As well as acting as an 'application enabler' for such IP-based multimedia services, IMS also promises to reduce time-to-market deployments, allowing new services to be tested, validated and launched into the market quicker and more cost effectively.
It will mark a departure from today's 'vertical' application platforms (or 'silos'), which provide dedicated functions to realise only one specific service, and herald a move to a reusable 'horizontal' service delivery platform that uses standardised functionalities and standardised external interfaces to deliver new services. 
Lastly, IMS is seen as a tool that can provide the intelligence that can turn all the other current telecoms buzzwords into reality: acting as the evolutionary path towards all-IP networks and as an enabler of true convergence.
And all this in an architecture that remains open (3GPP standardised) but operator-centric, allowing operators to maintain complete control over their networks and, ultimately, their customers. 
So why have the early trials of IMS not been as successful as many had hoped and why is IMS now being seen by some commentators as yet another expensive network upgrade with no return on investment in the short-term?
Now that the hype has made way for a more realistic outlook, operators must take a longer-term view of the IMS service roadmap. IMS must be seen as a foundation for future growth, rather than as a quick and easy answer to today's shrinking margins and increasingly commoditised telecoms market.

Billing a key factor
A fundamental area that needs to be addressed before the benefits of IMS are truly realised is billing, which will be a key factor in both enabling new services and protecting existing ones. 
Today's billing deployments must be able to enable operators to evolve from today's circuit-switched and IN-based services to 'combinational' and all-IP based approaches. But if such solutions are not sufficiently 'future proof', convergent approaches to rating and charging will not be able to cope with the scalability needed to charge for existing services or the flexibility to handle the SIP-initiated sessions used in IMS.
In the mobile space, the way an operator bills for data and IP services is already evolving. There is no data price plan scenario that does not exist; all parameters and combinations are already in use. Moreover, billing is already rapidly moving from a pay-per-use model to the subscription-based 'all you can eat' bundling model that is commonplace in the fixed-line broadband world. 
This transition is set to expedite once operators begin the migration towards IMS. When looking at billing in the IMS world, operators must ensure that it is both commercially viable and technically feasible.
The commercial aspect opens up whole new areas that billing will need to address. There will be opportunities to charge for new/enhanced services and for certain IMS enhanced attributes (e.g. presence, Quality of Service, grouping), but billing must also become more context/content sensitive and more 'personalised' – based on individual preferences and subscriptions, for example.
Billing must also break down the barriers between prepaid and postpaid by creating 'hybrid' online/offline billing models, offering, for example, prepaid options for postpaid customers and vice versa.
The migration to IMS is also likely to be driven by the corporate/enterprise market, where billing on the basis of Quality of Service, precedence/priority, reliability and delay are likely to be among the first IMS-enabled services.
However, neither the traditional, proprietary IN platforms (which also host prepaid rating functions) nor IT-based systems for batch-based post-paid billing offer sufficient flexibility or the required real-time performance to achieve such goals.
So what must a potentially convergent online charging layer provide in order to outperform the traditional approaches?
Sitting right between the existing network/signaling nodes and the IT environment, the Online Charging System (OCS) must enable seamless connectivity and ease of integration in both directions. In this respect the latest reference architectures as well as concrete charging protocols such as Diameter and well specified APIs (e.g. OSA/Parlay) are quickly gaining the status of 'new' de-facto standards. Furthermore flexible pricing and real-time charging mechanisms for event and session-based services have to bridge IN (circuit switched) and IP connectivity.
In order to truly support operators during their transition, new online charging layers must also be able to cope with traditional (IN-based) services, new hybrid services (combining circuit- and packet-switched sessions) as well as future all-IP/IMS offerings. Vendors who are merely repositioning their products will definitely fail to deliver these functionalities.
This raises the question of how long the transition from traditional billing to billing within the all-IP environment will take. The traditional systems will eventually be replaced, of course, but as they contribute the majority of revenue and profits they will need to remain in place for some time to come – at least until the all-IP/IMS systems prove that they can also provide the same levels of performance and stability as the existing IN platforms.
According to a well-known industry IMS maturity index, before true IMS is achieved – that is a fully packet orientated network that supports all IP applications – operators are likely to pass through at least four stages of evolution as systems migrate from legacy platforms and more SIP elements and IMS applications are introduced.
In terms of billing, converged Online Billing Systems with extensive real-time capabilities will be the answer for operators during this long transition and eventual evolution to a fully IMS environment. 
Convergent billing has the ability to become a single technology platform which carries out the authorisation, authentication and accounting for both prepaid and postpaid accounts, and where the charging, rating and balance management is carried out online and in real-time.
For operators, therefore, enhanced charging and billing could ultimately work as both a differentiator and a stimulator for rollout of new services.
The time to think about converged, real-time billing is now!                                                           

Andreas Freund is Vice-President, Marketing, Orga Systems and can be contacted via: e-mail: This e-mail address is being protected from spambots. You need JavaScript enabled to view it   www.orga-systems.com

IEC takes its next global ICT event to Milan to focus on current networking and technology

The IEC (International Engineering Consortium) brings together key ICT (Information and Communication Technologies) players from around the world to present cutting-edge information on next-generation networks and architectures. It renames its 21st Century Communications World Forum, expanding the focus of the program to include network convergence and IMS development and applications.
The International Engineering Consortium (IEC) introduces its C5 World Forum: Customer-Centric Converged Communication and Content on 26-29 March 2007 at the Fiera Milano Congressi convention center in Milan, Italy. Telecom Italia will serve as the official host sponsor and Chief Technology Officer Stefano Pileri will lead as the conference chairperson.
Formerly known as the 21st Century Communications World Forum, the C5 World Forum conference and exhibition possesses a strong network focus examining architectural issues and lessons learned from trials and implementation at network convergence. The show will explore topics that will help create the ultimate experience for the end user.
IEC President John Janowiak comments: “Based on the success of this event over the last few years, a critical time presents itself to us to elevate the show by bringing in carriers, providers, enterprise customers, and all those in charge of different types of convergence. We are excited to bring together international key players shaping the future of information communication technology.”
Members of the C5 World Forum planning meeting identified discussion topics for both mobile and fixed IP-based network architectures, as well as the technologies that will enable them. The educational conference will cover the following subjects:
1. Economics, business drivers/models, and regulatory issues
2. The customer experience and requirements
3. Services delivery, operations, and management
4. Network technologies, solutions, and transformation
5. IMS development, applications, and implementations
The C5 World Forum exhibition also plans to feature technology demonstrations from leading IP equipment suppliers and innovators, providing an opportunity for attendees to discuss new advancements and technologies with key experts of the latest technologies so that service providers can learn how to keep implementation costs down and maximise the return on infrastructure investment.
IEC Vice President of Educational Content Tom Costello comments: “As network convergence begins to realistically enable the fusion of communications and IT services, there is a need to visualize this convergence, examine its progress, evaluate its potential and results, and plan for the future. The C5 World Forum program allows attendees to involve themselves in discussions that examine the intelligence for determining the future of convergence communications.”
The C5 World Forum will serve the following audiences:
• Service providers
• Application developers
• Enterprise customers such as CTOs and CIOs
• End-user professionals
• Content providers and aggregators
• Corporate strategists
• Industry analysts
• Systems integrators

For further, complete information, visit: www.iec.org/events/2007/c5

In the networked services world, billing systems may come tattooed and musclebound in their efforts to eliminate fraud, says Doug Zone

Where once network engineers in lab coats and accountants in business suits designed architectures and crunched numbers at the heart of the enterprise formerly known as a telco, these days all manners of functions are emerging as part of the reinvented business.
This is not least due to the fact that willingly or not, telecommunications operators are increasingly waking up to the reality that they are becoming retailers. These days, forget base stations and infrastructure build-outs; service providers are engaged in the business of selling goods – originally supplied by either large producers (aka content providers) or intermediary distributors (aka content aggregators).
This being the case, it should come as no surprise that, as with the retailers of hard goods, revenue leakage ought to be a key concern. Shopkeepers worry about spoilage. Operators worry about systemic leakage. In the shopkeeper's case, the fruit goes off when their equivalent to BSS and OSS systems doesn't properly integrate! But an equal or even bigger worry for hard goods retailers is theft.
This is increasingly true for operators, not least because the networked services world adds a layer (or more) of complexity to the challenge. Where the retailer can solve a certain amount of his problems with brute force and muscle (if not a security camera), who will emerge as the telco policeman? Because, when an individual finds mechanisms to download his favourite film for free at the same time that operators are attempting to sell it, then let's not beat about the bush; theft is what we're talking about and some form of security will be needed.
To further complicate the situation, in such a case as the one above, the 'thief' is also likely to be a high value customer – using his or her broadband or 3G access to download the file from illegal sources. While the shopkeeper confronts a thief who's generally in his shop only to steal, the operator may be facing a situation in which the transgressor is also an important customer. In addition to the one illegal activity, the likelihood is that he transacts hundreds of other legitimate ones.
This could make for an even bigger problem than it seems, if you argue that the operator is actually complicit since the crime happens over the network.  The only certainty, in fact, is this; in the ethereal world, putting a large, security guard on the door (metaphorical or otherwise) wouldn't seem to be an option when it comes to addressing the situation. Or, as we'll see, perhaps it is.
The first thing telcos have to do, though, is acknowledge the problem. It is worthwhile noting how hard retailers work to effectively combat theft with more obvious mechanisms, including cameras and electronic tagging. But, in the world of content, both the thief and the goods he steals are 'invisible'. This creates a unique challenge, and one where traditional muscle as a means of discouraging criminals doesn't work.
In retail, the Point of Sale has always been a key theft prevention opportunity and mechanism. Stolen goods have to pass by the cashier first: not a 100 per cent effective barrier but sufficient to prevent all but the most determined of shop lifters. And, in some cases, even after the cashier they still need to get beyond the security staff and out of the door. Telecommunications providers have an analogy in real-time charging systems that don't allow consumption without payment.
To take a page from hard retailers, half the battle of preventing theft is a matter of making it more convenient not to steal in the first place. In essence, to do this, retailers take a lesson from economists. Each consumer makes a cost/benefit determination: do the savings from stealing outweigh the risk and moral discomfort of theft?  In other words, if it is easier to buy than to steal – ninety nine times out of a hundred – buying will win out. 
How do hard retailers make it easier to buy?
1. By making sure prices and promotions reflect local conditions.
2. By being careful to avoid the hidden costs that can make consumers nervous.
3. By minimising the time spent in checkout.
4. By allowing some customers to remain anonymous with self-check out.
Operators must start thinking in the same, creative ways. If the process of buying and paying for content is sufficiently convenient, user-friendly, and reasonable then for most people most of the time buying will win out. Given the choice, most people don't feel comfortable with theft. The job of billing software suddenly becomes a means to enable operators to create innovative buying and paying models that maximise this convenience. The default model may be the standard 'detect - guide - rate - invoice - pay', but as we are seeing in e-commerce, often times it will not be enough. 
As a result, billing vendors and billing operations must step out of the box and see their job as much more than 'detect - guide - rate - invoice - pay'. They must lead, not lag, in creating innovative business models; models that are convenient, open, time efficient and, at a minimum, better than file sharing (aka stealing.) If this happens, the content industries inclination to draconian over reactions will be headed off at the pass.                       

Doug Zone is Chief Technology Officer of Metratech www.metratech.com

In the wake of recent research, the telecommunications industry should not ignore the growing importance of emerging markets, says Lynd Morley

Emerging markets (when did that phrase come into such common usage?) are being hailed as the great future hope of the telecoms industry. Of course, many sceptics (who probably describe themselves as 'realists') point to a range of problems, from lack of infrastructure and competition, to low disposable incomes, as barriers to the holy grail of profit in the developing world, but researchers at Gartner insist that telecom companies ignore emerging markets at their own considerable risk.
According to recent research, Gartner notes that emerging markets account for more than half of the world's total telecom connections. Predicting that worldwide mobile connections will increase by 1.5 billion by 2010, Gartner believes that emerging markets will account for 87 per cent of that increase, and that, combined with fixed connections, developing regions will account for 69 per cent of the world's total phone connections in the same period. Clearly not figures to be sniffed at.
“Emerging markets may be under penetrated by communications services, but the hunger for improved connections is strong,” says Jouni Forsman, research director at Gartner. “Compared to disposable income, phone users in developing regions are spending five times more on communications on a per-user basis than their counterparts in developed countries.
“The rapid expansion of the telecoms industry in these markets is being fuelled by under penetration and the fact that communication-enabled services are crucial for overall development,” he continues. “This not only relates to telecoms and entertainment services, but to communications-enabled 'life enhancing' services such as banking, education and remote health. The high level of disposable income being spent on communications in developing countries today is clear evidence that the telecoms industry is mission critical in the emerging world.”
Among the regions that might be termed emerging, Asia is showing particular promise, though it is worth bearing in mind that this is a region of stark contrasts between some of the most developed and sophisticated markets in the world, and others that are only just beginning to bite the telecom bullet. 
According to research by Paul Budde at BuddeComm, the Asian telecoms market is estimated to have been worth around US$300 billion in 2006. The big new drivers are broadband and IP services, as well as ongoing growth in the mobile sector, particularly as value-added services come into the market. NGNs are also being rolled out by the regional heavyweights, with a strong move into triple play services. Budde notes that in looking at the Asian telecom market, it is impossible to avoid the impact of China. With its huge population and strongly developing economy, it is a powerful presence in the region. Having rapidly moved to become the biggest mobile market in the world, China's mobile sector has continued to expand at a rate of almost 20 per cent per annum.
But whilst China, along with India, still represent the largest opportunities, Gartner also highlights Indonesia as a high growth location – forecasting that the country will have more new telecoms connections between 2006 and 2010 than Brazil and Russia. Worldwide, according to Gartner, 50 per cent of new communications connections in the next five years will come from the so-called BRIC countries – Brazil, Russia, India and China.
No wonder the industry is being warned that it neglects emerging markets at its peril.

Lynd Morley is editor of European Communications

European Communications recommends the shows that count in the period from January to March 2007

Wholesale and (IP) Interconnection in Converging Telecoms 2007, London, 10-12 January, www.marcusevans.com

Mobile Business Intelligence Forum 2007, London, 10-12 January, www.marcusevans.com

Mobile TV and Video Forum, London, 15-16 January www.osneymedia.com

Mobile Advertising & Marketing,    Paris,    16-17 January, www.informatm.com

Marketing Week Summit 2007: Interactive Marketing, London, 17-19 January, www.interactivesummit.com

VoIP and Wireless VoIP Services Forum 2007, Berlin, 17-19 January, www.marcusevans.com

GSM>3G India, Mumbai, 22-23 January, www.informatm.com 

Strategic Telecoms Pricing And Differentiation 2007, London, 22-24 January, www.marcusevans.com

Revenue Management, Budapest, 22-25 January, www.iir-events.com

Telecoms Business Process Management, Vienna, 22-25 January, www.iir-events.com

Mobile Games Forum, London, 23-24 January, www.osneymedia.com

Telecoms Regulation, Budapest,    29-30 January, www.iir-events.com

CRM 2.0, Berlin, 29-31 January,    www.iqpc.com

IMS Implementation Strategies 2007, Amsterdam,    29-31 January, www.marcusevans.com

Local Loop Unbundling, Berlin,    29-31 January, www.iqpc.com

Interconnection 2007, Budapest,    29 Jan – 1 Feb, www.iir-events.com

Minimising Churn & Building Customer Profitability, Stockholm, 30-31 January, www.iqpc.com

DECT 07, Cap d'Ail, 30-31 January, www.informatm.com

IPTV & Triple Play Summit, Berlin, 31 Jan – 2 Feb, www.iqpc.com

3GSM World Congress, Barcelona,    12-15 February, www.3gsmworldcongress.com

12th Annual Global Mobile Awards, Barcelona, 13 February, www.gsm.org

Network Convergence – Building the NGN    Barcelona, 19-22 February, www.iir-events.com

3G LTE,    Berlin,    26-28 February, www.iqpc.com

Fixed-Mobile Convergence, Munich, 26 Feb – 1 Mar, www.iir-events.com

Telecoms World Russia & CIS, Moscow, 27 Feb – 1 Mar, www.terrapinn.com

IPTV World Forum, London, 5-7 March, www.iptv-forum.com

ENUM, London, 5-8 March, www.iir-events.com

Maximising ARPU 2007, Vienna, 5-9 March, www.iir-events.com

CeBIT, Hannover, 15-21 March, www.cebit.de

Managed Services & Outsourcing in Telecoms, Monaco, 26-29 March, www.iir-events.com

Telecoms Fraud & Risk, London, 26-29 March www.iir-events.com

WiMAX Business Strategies, Munich, 26-29 March, www.iir-events.com

C5 World Forum, Milan,    26-29 March, www.iec.org/events/2007/c5

CTIA Wireless 2007, Orlando, 27-29 March, www.ctiawireless.com

Telco 2.0 Industry Brainstorm, London, 27-29 March, www.telvents.com

Black Hat Europe, Amsterdam, 27-30 March, www.blackhat.com