Billing for 3G Mobile Data - meeting the challenge

by Jay Thomas | posted on 07 April 2004

The launch of real, live 3G phone and data services isn't just "more of the same" when it comes to billing. It's a huge opportunity for the mobile data industry to get it right - and of course, also a terrible danger of getting it really badly wrong, says billing expert Jay Thomas, in the run up to this month's "Billing Systems 2004" conference.

Billing for 3G is a massive challenge. It is not just the increased amount of tariffs for a wider variety of products that makes the billing process more complicated than ever. Complex discounting structures, some of which work retrospectively, as well as a whole host of third party information from content and service providers, retailers and advertising associates all have a direct effect on revenue.

One of the most important things to get right is the consumer's bill. The customer needs to feel that migrating to 3G is not going to cost a fortune and come with an assortment of different, baffling bills from different types of company. Users need to feel their next-generation bills are as easy to understand and pay as their 2G bills were. As the operator takes on new roles and is perceived by the customer as the content-provider, billing needs to reflect this. Users perceive only one interface for services and therefore there needs to be only one bill per user.

One reason 3G billing is holding back progress is the amount and variety of partnerships needed to provide 3G/UMTS services. Relationships with fraud organisations and credit card companies will see little change but many relationships will need to adapt heavily; such as those with interconnect partners, roaming partners, independent service providers and resellers. Furthermore new partnerships are constantly emerging, especially with content providers and content 'brokers'.

While managing all the different relationships, there is a real fear amongst operators that when the money in the next generation services pot is shared out, the cost of providing the pot will be more than the operator collects. The main problems cited by 3G providers include volume of data, pricing complexities, disagreements with service/content providers, and the simple fact that the bills themselves are higher.

New billing issues

Most GPRS operators have been surprised by the massive increase in data that needs to enter the billing system. The problems this huge increase has caused are mainly in the filtering process the data must go through before the billing system will understand it. The launch of 3G services will create an even sharper increase, which operators are already preparing for.

Another big hurdle for 3G operators to overcome ahead of service rollout will be prepaid billing.

Prepaid has proved to be the most popular cellular billing model, so it is natural for all 3G services to offer pre-pay as soon as they become available. But as users will increasingly want to access multiple services, operators will need to be able to advise them of balances in real time. They must also use the billing system for real time credit checking as the user requests those services. Real time billing data will be imperative in this process.

The systems to handle 3G billing are already available. It is time for the operators to get the right infrastructure in place: that means best-of breed mediation, billing systems and prepaid support, to start targeting a return on their 3G investments.

Narus is an exhibitor at Billing Systems 2004 - a leading show for phone operators, going back to 1993. The 11th running of this exhibition and conference will take place in London on April 19th - 22nd, 2004 at the Earls Court Conference and Exhibition Centre.

For further information email the show organisers or call +44(0)20 7915 5600.

Jay Thomas is VP of Product Marketing at Narus, which describes itself as "the leader in tier-one mobile, prepaid, broadband, and Internet backbone mediation."

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