The challenges of making ‘Pay Now’ a reality

Written by on October 14, 2015 in BillingViews, Guest Blog with 3 Comments

Pot Of Gold And Rainbow On Grassy HillExamples of mobile pricing innovation are proliferating like mushrooms in a damp forest. Traditional bundles of data, voice and text are being deconstructed to be re-combined as highly personalized and configurable plans tuned to digital consumers’ lifestyles. Social media, music, HD video, roaming packs – purchased for an hour, a day, a month, or a year. Choice rules and the opportunities to drive new revenue and excite customers with compelling, relevant and valuable propositions have never been greater.

These innovations will also drive profound and beneficial change in the technological and economic landscape for the Digital Service Providers (DSPs) serving these consumers. If pricing innovation is the butterfly’s wings, then the hurricane is what is about to blow through the world of telco payments and billing.

The story starts, as it should, with the customer. The digital natives hungry for these pricing innovations march to a real-time beat which also drives their purchasing behavior: “Show me what I need now, make sure it’s relevant, provision it now, and I’ll PAY NOW.”

I don’t use CAPs lightly but PAY NOW is that important! To understand why requires a short retrospective of telco retail billing and payments, a world of deep-rooted traditions little changed in half a century.

The telco payment map comprises two countries – Postpaidia and Prepaidia. Islands with incompatible infrastructure; different size railway gauge, one runs AC electricity, the other DC – you get the idea. Diplomatic relations are awfully strained and numerous Convergence Treaties have seen limited success, won over very long timescales and at substantial cost to balance sheet and careers. Each island boasts multiple layers of defence designed to break the spirit and budget of the most fervent Convergist.

But for the digital consumer, PAY NOW is increasingly the destination of choice; easy to understand, easy to implement and immediate. It works for groceries, it works for apps, so why not digital communication services? The successful DSP will position PAY NOW center-stage in their charging strategy. They will leave the complex, expensive and non-strategic functions of payment processing and debt collection to other organizations designed to do that sort of thing.

Despite the conceptual simplicity of PAY NOW, its introduction can bring huge benefits for a DSP’s infra-structure complexity and cost. No more ‘big billing,’ subservient to the dictatorship of the monthly bill cycle; financial management and bad debt costs will tumble; no postpaid – no invoicing costs, no prepaid – no top-up systems.  Offers will no longer be tied to a bill cycle, and can be made as a one-off, one month recurring, 12 month recurring deal – whatever the customer needs. The heart of the PAY NOW service provider will be an efficient and unified real-time charging and policy core, integrated with a payment gateway and supported by rich self-care capabilities.

In addition to cost reduction and simplification benefits, many of the constraints enforced by legacy billing and payment systems and processes will ease into retirement. The drag on innovation and time to market – created by demanding reverse compatibility with features such as re-rating, pro-rating and bill cycle changes – vastly outweighs their contribution to customer experience.  They don’t create value. Lose them. Focus on what does.

It’s not for every segment or market, but PAY NOW does have a natural affinity with retail digital communication services. It offers the potential to profoundly alter digital service provider economics through hugely reduced operational costs and a much simpler and more effective platform for innovation and value creation.

After pretty much half a century of the same, tired pricing, it’s about time.

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About the Author

About the Author: Nigel is a seasoned senior BSS professional with an excellent international track record across start-ups, vendors and operators. He has deep knowledge and design experience around real-time charging, policy and BSS/Telco generally. and is currently Director of Product Strategy at Matrixx Software. .


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  1. Paul Hollingsworth says:

    This discussion has been going on – in some form – ever since the arrival of the first non-POTS (Plain-old-telephone-service) pricing plans developed in the early 90s, What’s so strange about this (not new) situation is that PAY NOW is literally ubiquitous – from paying for your morning coffee to buying your house and 99% of transactions in between.
    So why are we still debating this (apart from the need to develop pull for rating/charging/billing products)?
    Well, firstly the charging/billing software in nearly every CSP is pretty OK (or even good) at pre-pay and periodic paradigms. And in many (most?) CSPs there is already software that can handle pay-now transactions (in both cash or bank transfer form).
    Thus my belief is that we’re really talking about the age old time/cost to market of new products and the supporting convergent BSS and the search for the “Killer App” to drive the CSP business case. Which in this instance is possibly and coincidentally Apps (or data).
    Long live “George and the Steak knives”!

  2. Michah says:

    Nice article. however, I beg to differ. PAY NOW sounds great. But don’t let the catchiness fool you, its hardly simple to perform. ‘Big billing complexity’? Now, replace that with ‘big fraud complexity’ and real time AAA (ie authentication, authorization, and accounting). Set that into a digitial content context and you’re talking massive infra-structure overload that can peak to the point of rendering services completely inoperable, beating the hwole point.
    I would argue to get out of subscription based payments and vote for personalized pay-per-use tariffs on a pre-paid basis. Not saying that in itself doesn’t have complexities.

  3. Teresa Cottam says:

    You’re right in many ways Nigel, but so is Paul. My view is that pay-now is just table stakes for digital service provision. I find it hard to get excited about simply because it’s so obviously needed as a basic requirement for a DSP. This is what I think

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