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 Channel Futures

Cloud


The Once and Future King

  • Written by Tara
  • July 31, 2006


ONCE UPON A TIME

, resellers were singleline businesses, rebilling long-distance, say, or local services. Customer service and price were the differentiators. Now, this market segment has branched out to take on new services, both to mitigate the risk of being a one-trick pony, but also to compete for customers who increasingly want enhanced, bundled services with interesting content and applications that seemed tailored just for them. With the bundle as king and differentiation its mistress, retail billing outsourcers are moving accordingly to support the changing back-office needs of these dynamic Tier 2 and Tier 3 players.

With all the focus on enhanced multimedia services, bundling and content have risen up through the ranks as a way for resellers to survive in a crowded market. Resellers want speed-to-market, flexible and unique rate plans, and the ability to add in value-added services like sports scores, says Randy Brouckman, COO of BSG Clearing Solutions GmbH. Getting an outsourcer that can support unique marketing packages and bundling plus integration of the provisioning process and customer care processes [is a necessity]. BSG provides clearing, settlement, payment and financial risk-management solutions, and can put in place the billing, collection, mobile roaming and national customer care for resellers and other upstart communications providers.

Real-time access to information and time-to-market is absolutely critical for resellers looking to build compelling bundles, says Randy Minervino, vice president of sales and marketing at Profitec Inc., a billing and customer care outsourcer. When the marketing department decides it wants to run a new product mix, the billing has to support it, and it cant take 18 months to launch, he says. So a need for integration is there its almost axiomatic that an existing company taking on new products will need to update existing systems. And a TDM system cant support IP, for instance. So thats where relying on an outsourcer can really come in handy. We take care of all that product integration for you.


MACCs Dave Waite

The integration of different suppliers services is another big aspect to consider when choosing an outsourcing vendor. For instance, if a CLEC or other reseller seeks to enter a triple-play market, one challenge is to provision, order and bill on multiple, disparate networks, says Dave Waite, director of product development at Mid America Computer Corp. (MACC), which offers a variety of services and front-office software.

Many times they might enter a new market segment with no practical knowledge of running a business there or what OSS you need in place and how it all has to communicate, says Waite. So partnering can help avoid the integration issues.

Also, in the age of one-to-one marketing, content downloads and micro-billing is part of the package. Those transactions often are sent to someone else for processing, says Tracy Miller, vice president and unit leader of telecommunications for Infogix Inc., a data validation company. Will outsourcers be able to secure components outside their own systems? Often the offers are hybrid, and different technical components, some of which may be owned by the reseller, need to get woven in too, like front-office applications. So you end up with all kinds of people involved and information exchanged, and everything has to be speedy and accurate.

Another reseller requirement is compliance with any legislative mandates new services might bring with them. Resellers come from a sales and marketing background, and thats where their interest is, says Don Culeton, founder and president of Info Directions Inc., which designs, hosts and installs telecom operations and billing solutions. Meanwhile, a lot of the newer services are under regulatory review and carry new types of tax burdens. They may not have the resources or awareness to manage that, so that can be an important part of an outsourced solution when they add new things to the portfolio.

Even bill printing is changing as the resellers are. For resellers and rebillers, increasing market share is essential to their businesses, therefore regular communication with the customer serves to improve customer loyalty and brand awareness, says Ron Whaley, vice president of sales and marketing at OSG Billing Services, a bill presentment vendor. In addition, these providers generally offer several product and service mixes, which requires extremely detailed billing. By outsourcing the billing process, a reseller has the potential to increase market share while generating revenue through improved operational efficiency, optimal postal discounts and an updated invoice design, which helps to market the company more proficiently.

Click to Enlarge

This screen in Comverses management portal allows operators to see systems health and all alarms and alerts that have not been fully cured.
Click to Enlarge

Profitecs OmniBill main account screen presents a myriad of end-user information on a single form.

OSG is providing increased opportunities to use the invoice as more than a financial tool. Since the invoice is usually the one consistent touch point a provider has with a customer, it is important to utilize this document as a communications and marketing device, says Whaley. For example, we have had customers who sold advertising space to local businesses and sister companies on the front of the invoice, increased adoption of products and services by using an invoice message in conjunction with a bill insert and envelope message, built up community awareness for charities through inserts and invoice messages, and improved service offerings by surveying customers through the invoice.

And finally, despite the speed with which new services are being made available, resellers need to keep on top of the margins and which ones are profitable, says Jim Lazeroff, Info Directions director of marketing. So a more complex service portfolio requires a broader analytic capability.

With new requirements and complexity being driven into retail billing by diversifying portfolios, resellers also want more control over it. Rebillers want full control of basic BSS software, says Kurt Silverman, CTO for Comverse Technology Inc.s billing solutions group. They have to contract out the construction of it in many cases, but then they want to own it, so they can take care of their own calls and make their own bundles and have a Web presence they can change themselves, which is a really big differentiator.

Silverman says another issue is the need to send product and bundle information down to the host carrier to make any changes, and that requires a tangle of software customized for that environment. Its very complicated and takes a while, Silverman notes. But as they develop more of their own expertise and market research, they can segment the customer base and roll out a whole host of products, and it becomes difficult to do that dynamically.

Comverse offers resellers an outsourced solution that combines billing with BSS and carrier integration, with an eye to transferring the system once they scale to a certain point; Comverse then handles the implementation and transition services.

The move from outsourced to in-house hinges on the portfolio complexity and market maturity. A provider today cannot simply offer residential long-distance, as an example, says Infogixs Miller. So outsourcers have to offer a consolidated telecom package. Resellers will need to offer some traditional services, then be flexible on the enhanced side and bring in content and other value-added services. They can leverage those outsourced systems and all that expertise, then as they grow, take it over.

But initially, you need flexibility to get your business up and running, he adds.


Out-Vantages

For Tier 2 and Tier 3 service providers outsourcing billing, a few advantages stand out.

  • Low initial investment.

For a few thousand in startup expenses, a provider could leverage a multimilliondollar platform.

  • Quick speed-to-market.
  • A professional outsource service bureau can implement a customer in a matter of weeks instead of the months it would take to implement an internal system, due not in the least to the fact the employees being used to implement internal solutions already have existing job responsibilities.

  • Lack of internal resources.
  • Most resellers do not have the full range of expertise necessary to support an internal application among their existing staff.

  • System interoperability.
  • Market forces require a dynamic product mix, which requires the billing system to continually evolve and interact with a wide range of activation platforms. Outsourced solutions can better keep up with change requirements because they get input and suggestion from a wide range of other existing customers.

  • Reduced ongoing expenses.
  • Professional outsourcers can maintain a development staff and spread system change expenses across a large number of customers, so the expense exposure to a single client is limited.

  • Support for market forces.
  • In order to remain viable, an outsourced billing vendor needs to be able to attract new clients utilizing new technology while they continue to support existing customers selling historical legacy telephony products. Therefore, a reseller utilizing an outsourced solution has the advantage of operating a platform that enables multi-product marketing, can expedite receivables payment, minimize customer service expenses and improve end-user retention.

    Source: Profitec Inc.

    Links
    BSG Clearing Solutions GmbH www.bsgclearing.com
    Comverse Technology Inc. www.comverse.com
    Info Directions Inc. www.infodir.com
    Infogix Inc. www.infogix.com
    Mid America Computer Corp. (MACC) www.maccnet.com
    OSG Billing Services www.osgbilling.com
    Profitec Inc. www.profitecinc.com
    Tags: Agents Business Models Cloud

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