Features

A ball of confusion – billing for content

Dreams of huge revenues from mobile content will remain just dreams, unless the industry gets to grips with the billing problems. Here, Andy Wilson, Sales and Marketing Director, Ryder Systems, comments on the exponential growth in mobile content and the importance of billing.

Open any magazine or switch on any television channel these days and you are greeted with a plethora of mobile ring-tones and a variety of downloadable content adverts. Mobile content has become a great money spinner, but the challenge now is finding the best way to bill for these services.

With the cost of the new 3G licences telcos have had to look at new revenue streams and mobile content is a way many are looking to recoup their investment. However, although many telcos are offering a variety of downloadable services, the most popular content currently comes from third party specialists.

An increasingly important source of revenue for telcos, Analysys Research suggests that mobile content and entertainment services accounted for 2% of total mobile service revenue and 16% of non-voice revenue in 2002, and is expected to grow to contribute to 11% of total mobile service revenue and 34% of non-voice revenue in 2008. Mobile content will soon be responsible for a significant part of ARPU (average revenue per user) growth in Western Europe over the next five years, resulting in the drive for telcos to produce and sell content to customers.

Payment for these services is being delivered into the hands of the third party content providers, meaning telcos are potentially missing out on a huge revenue opportunity while their networks are used as a delivery channel.

This poses a number of challenges for telcos, firstly, how to make more money from content, and secondly how to effectively bill for it.

At present third party suppliers tend to charge for their services using premium rate SMS messages which the handset user pays to receive. Unfortunately, many continue to send these messages as well as offers of additional content, long after the original material was requested in a bid to sell the user increased amounts of services. This not only ends up costing the handset user a great deal of money until the third party provider is requested to stop, but also makes the handset user wary of downloading any future material.

Handset users need be able to clearly see at a glance how much money they are being charged for downloads. For businesses, downloadable content poses a large financial problem, should handset users download material, organisations need to ensure that this is paid for by the employee and not by the business.

The majority of post-billing cost allocation systems currently in operation today, do not easily facilitate the division of business and personal usage costs. For example, using a dual SIM device requires the user to switch between two numbers depending on whether the usage is either for business or personal reasons. Although an option for separating calls, dual SIMs can add extra complexity for the telco requiring them to send two different bills, one for each number on the SIM, increasing costs and the credit risk of chasing two different payments.

Another popular identification method is adding dialling codes e.g. inserting an asterisk (*) after the dialled number which enables the telco to sort the phone bill by these codes, which are often used to separate business from personal usage, but this is an ineffective solution for separate data usage from voice calls Both these solutions place an emphasis on the user to remember to use these solutions and are only appropriate for the division of voice rather than data,

At Ryder Systems, we have developed a web-based solution which is currently being rolled out to a number of tier 1 telcos providing effective post-billing cost allocation. The simple to use interface allows the handset user to quickly tag calls, data downloads and SMS text messages as either personal or business. Once allocated, telephone numbers are then remembered eliminating the need for the same numbers to be allocated over and over again. When all usage has been allocated on the monthly bill, the handset user then submits the information for payroll to deduct personal spend from their salary, ensuring the company only pays for business usage and the telco only sends one bill.

When any organisation equips its workforce with mobile handsets, it opens itself up to a number of risks. Businesses need to set clear acceptable phone use policies, similar to those governing IT devices, whilst giving users the freedom to use handsets at will. Cost allocation tools give the organisation greater control over ensuring the handset users pays for all usage, and Ryder’s solution is one of the first web-based tools, which allows the user to allocate all usage from voice and data as either personal or business.

Mobile content is a contentious issue. Third party providers, with their monopoly over the market, risk damaging the public’s perception of downloadable material with their unfriendly billing methods. This isn’t necessarily a bad thing, with sophisticated billing systems and effective post-billing cost-allocation tools; it is the telcos who stand to gain from the explosion in the demand for mobile content as users move from third party providers back to that provided by their network operator.

Tools such as SplitBill significantly help telecoms managers within organisations efficiently and effectively manage the monthly bill. Benefiting all parties, the individual handset user only needs to rely on one handset, which is generally of a higher specification and all voice and data usage is charged at a preferential business rate, which tend to be cheaper than personal rates. This leads to an increase in usage the Telco who benefits from increased revenue. But the major benefit is for businesses, which can easily reclaim personal expenditure through a simple automated solution.