Is the future of billing – evolution, revolution or devolution?

Written by on August 13, 2015 in BillingViews, Opinion with 4 Comments

TransformationBilling used to be the center of the BSS universe. At least that’s what I used to think. Nowadays I’m not even sure whether it’s just a distant planet or even in the same galaxy!

What used to be deemed the crown jewel of every telco operator, billing is hardly mentioned these days, seemingly overwhelmed by online charging, pre-paid platforms and real-time payment processing.

We know that people don’t like bills, or even want them. They seem quite happy utilising pre-paid services with no confirmation of usage, and have adapted in-app purchasing with a confirmation receipt coming afterwards. Getting a post-paid invoice in the mail with pages of call records that no one bothers to peruse seems almost anti-environmental these days.

So why do we bother with post-paid billing at all? Well, it’s still a legal requirement in many jurisdictions, but electronic records are gradually being accepted. Billing systems have been primarily used for post-paid consumer and business customers – and businesses still demand invoices. But consumers less so.

We are also seeing more and more services moving to flat-fee or subscription billing. Voice has become part of a data stream, and complicated rating by distance and time has become almost irrelevant as people and networks migrate to VoIP applications en masse.

Subscription billing is dead easy and doesn’t need to worry about mediated call records, complex rating and detailed bills. The job of rating has moved to OCS (online charging system) and product distribution platforms with their own catalogues. Prices for third-party products and services are determined easily on a cost-plus basis. Even discounting can be done on the fly.

Billing systems used to be the core customer information store, but customer information is now stored on multiple systems, often regulated by the CRM and accessible in real-time using advanced SQL queries and big data technology.

Billing systems are costly to buy and costly to run. In an era where CSPs and network operators are cutting costs at every opportunity, billing is increasingly coming under the microscope. And billing vendors are having to spread their portfolios to maintain revenues, or even stay in business. We have already seen some fall by the wayside and others becoming acquired. It’s all part of the business rationalization and transformation everyone is going through in this digital age.

The advent and growth of M2M and Internet of Things (IoT) traffic will further change the structure of billing and how it will be utilized, and it might not even rely on existing billing models. It is highly unlikely that any IoT exponent will be happy with being billed for usage, opting most probably for a monthly subscription fee per device. Even then, CSPs might not get the bulk of the billing, as specialists managing the devices may also consolidate or roll up a number of devices and opt for a single account with a network operator.

Billing for IoT will be highly competitive and, therefore, very price-sensitive. Will CSPs want to maintain or expand existing legacy systems, or will they opt for cheaper, subscription-only systems?

Perhaps billing’s biggest challenge is where it will ultimately end up in the organizaton. It has always jostled for position between finance and IT – both of which had considerable provenance and interest in its well-being.

But if it is relegated to becoming an invoice collation and distribution portal, fed by a multitude of smaller and task-specific systems, we may well see it disowned and disbanded. Its simple task of invoicing and acting as a debtor’s ledger could be easily taken over by the enterprise accounting system used by finance. What a sad day that will be!

First published at B/OSS Asia.

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About the Author

About the Author: Tony is a freelance writer, regular speaker, MC and chairman for the telecoms and digital services industries worldwide. He has founded and managed software and services companies, acts a market strategist and is now Editor of DisruptiveViews. In June 2011, Tony was recognized as one of the 25 most influential people in telecom software worldwide. .

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  1. Cato Rasmussen says:

    Tony, isn’t this was I suggested to you at Crown Plaza Heathrow some 2-3 years ago.
    Regard traffic as a cost element and calculate it in the pricing of other services. Like any retail are treating transport cost.

  2. Alan Coleman says:

    Tony, a very thought provoking piece. While I agree that today’s approach to billing leaves a lot to be desired I would worry that abandoning the bill entirely would lead to the loss of a very important strategic touch point with customers. Rather than abandon the bill it should be re-habilitated away from being a invoice / revenue collection tool to more of a customer relationship status. A place where personalised information can be shared and value propositions introduced or re-stated. CSPs will need to sell a broader portfolio of services to their existing customers and to do this effectively they need to develop better in-life communications….the bill should play an important role in this.

    • Tony Poulos says:

      Good point Alan and an area that Britebill excels in. But it reminded me of the old days of ‘snail mail’ and ‘bill stuffers’ where a paper bill was lost in an envelope packed with marketing material. The outcome was that people ended up reading neither and the cost of delivering the bill skyrocketed. Of course, in this era of electronic delivery things could be done a lot better and achieve what you suggest, if you can keep the marketing folk under control!

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