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Category Archives: Revenue Assurance

Why Telcos Need Real-Time Revenue Assurance?

Digital, Revenue Assurance

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Revenue leakage is one of the major worries affecting telcos around the world.  The number says it all. The 2017 Global Fraud Loss Survey by CFCA says telcos lose $29.2 Billion (USD) annually, equivalent to 1.27% of global telecom revenues, to several revenue frauds. For telcos, who are also aggrieved by the declining margins from traditional voice business, safeguarding the existing revenue sources thus becomes critical. The rising concerns over revenue loss have brought the discussion around a new approach to revenue assurance (RA). While the revenue assurance solutions in the market address some of the possible threats in revenue leakage, they lag behind in delivering a faster detection and reconciliation capabilities.

Why Real-Time Revenue Assurance?

As we see today, the main drawbacks associated with traditional RA solutions is the long gap between revenue leakage detection and revenue realization. Since these systems adopt conventional methods for data consolidation and streamlining, the process requires manual intervention in parsing and auditing. Considering the enormous volume of transaction generated in today’s customer-centric world, telcos cannot ignore such lapses in remediation. Thus, the need arises for an intelligent, automated RA platform that can reduce the gap between these processes to a minimum. Legacy systems also face challenge due to the rapid surge in user data generated from millions of transactions every day. In the wake of new challenges brought by IP networks and the sophisticated interconnection frauds, detecting and remediating the anomalies becomes even more challenging.

Real-Time Revenue Assurance: How?

Real-time revenue assurance focuses on minimizing the time gap between fault detection and reconciliation. With analytics at the core, the technology enables service providers to detect the threat as soon as it occurs and start the reconciliation process within hours of data inception. Let me elaborate the process a little. The files collected at the source will be pushed to the real-time RA system within a few minutes. The data is parsed and loaded within, say 30 minutes, and the reconciliation process starts within the next two hours, enabling the early revenue reconciliation than the traditional approaches.

Analytics plays a crucial role in ensuring real-time RA.  The complex algorithm segregates the data based on a set of parameters, so anomalies can be detected quickly and accurately. Advancements in real-time RA also promise near real-time and even real-time controls on revenue leakage. The output of RA controls can deliver additional insights on each transaction, which can be used to improve sub-optimal processes.

What Business Benefits Real-Time Revenue Assurance Bring to Telcos?

Since revenue assurance is the most crucial element in a telco business, the impact brought by real-time RA is huge. As mentioned in the beginning, the loss attributed to different types of fraud is incomparable, so a reduction in leakage exposure time results in significant savings. Also, revenue assurance in a telco business is linked to multiple processes including data collection, billing, settlement and operations. Thus real-time RA allows telcos to gain increased visibility into all aspects of subscriber data, which in turn helps them to improve Quality of Service (QoS).

Subscriber management is a key aspect of revenue assurance as it helps telcos to deal with customer attrition. The operators need to have visibility into subscriber’s usage and billing patterns. Such insights will help them to launch the right mix of services that enhance customer value and improve ARPU. Subscriber management, especially in IP-based systems, proves crucial to eliminate billing errors and disputes. Real-time revenue assurance scores in this context as it provides real-time visibility into customer behavior and capture anomalous activities before it impacts the network.

Watch this column to gain more insights on revenue assurance for telcos.

Neeraj Upadhyay

Neeraj leads digital marketing for Subex with focus on Website, Search, social media, mailer automation and MIS. In addition to this role, he also looks after product marketing for Revenue Assurance & fraud Management solutions for the company. He comes with over 8 years of experience spanning across sales, product and digital marketing.

Device Journey Management: the next frontier for Device Assurance

Fraud Management, Revenue Assurance

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In recent years operators have scaled their thinking into hundreds of millions – but not in terms of data volumes, but instead in the numbers of devices now utilizing their networks.  Smart handsets have led the charge of devices, followed (and soon to be surpassed) by IoT devices, and an army of small cells that will serve to densify the upcoming 5G network rollouts around the world.

Why are these devices capturing more and more operator attention?  With over 1.5 billion smart phones shipped from manufacturers in 2017, the amount of investment by telecom operators just in this device category alone amounts to approximately 20% of their overall operational budget.  However, each year tens of millions of dollars of this opex are being written off as losses by operators due to issues with logistics (forward and reverse), fraud, and process misalignments; device journey oversight doesn’t exist as a discipline today.

Subex has invested almost two years researching this domain, including talking with operators of all sizes around the world.  What we have found is an expanding set of exploitable gaps that current systems and practices are incapable of closing.  Points of risk exist across internal processes, channel partners, distribution and supply chain, and various other areas leading to (and sometimes even originating from) the end consumers.  These risk points accumulate losses for operators that range between $500K USD to over $10M USD per month, per operator, depending on size of the operator.

The device growth area today is not only in smart handsets, but also in a wide array of small cells, sensors, and various other categories.  With already significant gaps existing in oversight, this new breed of devices puts an even greater risk on operating budgets.  Under current estimates, deployed IoT devices alone in the next 5 years will exceed 200 billion units, dwarfing the handset counts worldwide.  Can losses be sustained, or even ignored, at these levels?

Subex will be speaking about a comprehensive strategy and methodology for Device Journey Management during a presentation at the CFCA Winter Conference in Las Vegas on February 6th, 2018.  We will also be at the Mobile World Congress in Barcelona later in February where we look forward to speaking with operators encountering the same problems.

John Brooks

Vice President – Product Management – John Brooks serves as the Vice President of Product Management in Subex. He has over 26 years of experience in Telecommunications, spanning Fixed, Mobile, Data, and Video technologies. Within the industry Mr. Brooks was a board member for the GBA, founded the TM Forum Fraud team (authoring the first International Fraud Operations and Fraud Classifications guides), and now leads the TM Forum Network Asset Management team, focusing on transformative best practices for SDN/NFV operations. Over the years Mr. Brooks has served as an Advisory Board member for a prominent technical university, and has spoken at over 50 industry events and authored numerous papers on topics spanning IoT, Digital Disruption, Big Data, and Enterprise Risk Management. With Subex (formerly Connexn/Azure) since 1999, he has directed over 40 successful Cost, Revenue, and Business Optimization engagements at over 24 top-tier carriers globally, including AT&T, America Movil, BT, Vodafone, and Verizon.

Assurance by any other name… reflections on RAG Sydney

Credit Risk Management, Revenue Assurance

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In my role leading business solution consulting for Subex Network Analytics, I traverse a lot of time zones.  People assume I have sage advice and perhaps an elixir to cure jet lag.  Sadly, I slog through the transitions like everyone else, employing a variety of coping strategies.   I just read about an intriguing approach that some members of the US ski jumping team will use at the Winter Olympics.  They are embracing jet lag, purposefully showing up just days prior to competitions.  Why?  For them, it is best not to think too much as they soar into the abyss.  Being in a foggy state may be an asset for some, but the rest of us still need to find ways to stay on our game as we trot the globe!

Fortunately, I managed to keep my edge for the Risk and Assurance Group (RAG) conference in Sydney, after traveling 18-time zones to get there.   It was a very worthwhile event, held on the Optus campus, with a good mix of operators and vendor partners.   Anamitra Mukherjee (Optus) delivered the keynote and provided material examples of how his team is challenging the traditional boundaries of RA, branching into areas such as handset assurance and network assurance.  Members of his team, Sujith Dissanayake and Gihan Samarawickrama, provided more insights on handset assurance during their talk later in the conference.   Anamitra explained that Network Assurance enables operators to determine whether they are spending the “right dollars” on the network.  Are there opportunities for cost savings such as harvesting unused assets and redeploying them?   He went on to describe the benefits of reconciling the fixed asset register against the physical network.  Payoffs include better asset visibility, more accurate depreciation schedules and efficient tax strategies.  Calculating the profitability of cell sites is another area his team is exploring.

From Anamitra’s talk one got the sense that it is time for operators to ask: “Is there more to assurance than RA?”  The consensus at the event was a resounding “yes”.   This was a major topic of discussion.  Eric Priezkalns, one of the event organizers, expands nicely on this theme in his blog post about the event.   Jayne Hunter of Vodafone Hutchison Australia explained that her role has migrated from RA to Margin Assurance.   Darren Rinaldi of Foxtel described how his team performs “entitlement reconciliation” within the broader context of process assurance.   Geoff Ibbett from RRM Solutions chimed in with the importance of contract assurance during a panel discussion.  I could go on but you get the idea…

To the list of assurances, I joined the party and added device assurance.  Subex is observing that usage-based frauds have been in decline (although IRSF continues to be popular) and there has been a sharp uptick in device and equipment issues.  Device/equipment frauds, thefts, reverse logistics breakdowns, etc. are becoming endemic.   During my talk, I pointed out that such issues are not limited to mobile handsets.  CPEs, set top boxes and even small cells can be considered devices and all have their own risks to mitigate.  To this mix you can add vCPEs and the need to control for excess license costs.

There certainly is a new world of assurances to contemplate.  In my book, there is only one missing.  Any takers for jet lag assurance?

Andy Jacobs

Director of Business Development for Network Analytics
Andy has 20+ years of experience in engineering management, business operations and IT, primarily with Tier 1 operators including Level 3, MCI and GTE. His responsibilities included leading IT development teams that built mission-critical network management, provisioning and inventory systems with thousands of users. Prior to joining Subex, Andy was a Senior Manager overseeing a Data Governance organization at a major Internet Services provider. Andy graduated from the University of Pennsylvania with degrees in Electrical Engineering and Economics (Wharton). He holds an MBA from the University of Colorado.

Subex at RAG Sydney Conference 2018

Fraud Management, Revenue Assurance

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RAG Sydney Conference 2018 : G’day! The upcoming Risk and Assurance Group conference takes place next week in Sydney at the height of the Aussie Summer.  For me, it will be an excuse to trade the snowy landscape of Colorado for Bondi Beach and fun in the sun.  Only kidding—won’t be hitting the beach but am looking forward to a great opportunity to interact with industry professionals and thought leaders in the business assurance domain.

On Day 2 of the conference, there will be two-part talk on the emerging discipline of handset and device assurance.   Sujith Dissanayake and Gihan Samarawickrama from Optus will share their journey managing handsets risks, including use cases they have tackled.  I have the privilege to speak next and provide an industry perspective.  Operators have always been challenged to control costs and reduce risks related to network edge devices.  While mobile handsets are certainly top-of-mind, devices can also include customer premises equipment (e.g. routers, set top boxes, DSL modems, ONTs), small cells, connected smart devices and even virtual assets.   A comprehensive device assurance program requires controlling for revenue, fraud and complex supply chain risks.  I will cover drivers and strategies for establishing a device assurance program.

Unchecked device frauds and mismanagement cost global operators billions annually.  Our industry is just now beginning to pay proper attention.  Let us help you ride the wave (ok, a Bondi Beach inspired metaphor!) to getting your device costs under control.  If you are attending the conference, I look forward to seeing you there.

Andy Jacobs

Director of Business Development for Network Analytics
Andy has 20+ years of experience in engineering management, business operations and IT, primarily with Tier 1 operators including Level 3, MCI and GTE. His responsibilities included leading IT development teams that built mission-critical network management, provisioning and inventory systems with thousands of users. Prior to joining Subex, Andy was a Senior Manager overseeing a Data Governance organization at a major Internet Services provider. Andy graduated from the University of Pennsylvania with degrees in Electrical Engineering and Economics (Wharton). He holds an MBA from the University of Colorado.

The Future Success of Telecom Lies in Revenue Assurance

Digital, Revenue Assurance

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As the telecommunications industry anticipates the next wave of growth triggered by digital disruption, there are a few developments that demand critical attention from telcos. These trends have had a direct impact on the way telecom services are delivered, often impacting the revenue streams of operators. Let’s look at the top trends that impacted telecom revenue and see how the telcos needs to devise a revenue assurance strategy to deal with these changes.

Revenue Assurance in OTT Era

The IP revolution that swept the telecom industry over the past decade have brought in immense opportunities for OTT players; but for telcos, it was the beginning of a cataclysm marked by cut-throat competition and revenue loss. Since then, the journey of telcos has never been easy. As OTT players took away the bigger pie, operators had to redefine their business strategies to safeguard their revenue streams. Thus, their priority shifted from traditional services to the new digital offerings that largely rely on IP networks. As the journey commenced, a series of new challenges emerged in the service delivery.

With a large bouquet of offerings encompassing voice, data and video streaming, revenue management becomes a critical concern for telcos. The complexity associated with subscriber management and invoice management has created the need for a real-time revenue assurance (RA) platform designed around analytics capabilities. The automated RA capabilities ensure that the tariffs are implemented uniformly across all subscribers and that the billing system is free from all types of errors.

Technology Integration in OSS

One of the key challenges involved in a telecom provider’s transition to a digital service provider (DSP) is to integrate the transactions from different types of networks – say 3G, 4G or IP networks – to a common operations/business support system (OSS/BSS) system. Traditional systems at most telcos were purpose-designed for circuit switched networks and their revenue assurance use cases revolved around batch processing of data. To meet the complex demands created by the new digital offerings, the OSS/BSS needs to evolve to support multiple network topologies. They need to also possess the capabilities to handle large volume of data generated from disparate channels.

The modern approach to revenue assurance allows creation and maintenance of network inventory, network fault management, and automated provisioning of services through real-time analytics. This approach goes beyond the traditional way of analyzing the basic data for billing to identify aspects that impact quality of service (QoS) and customer experience.

Telecom Fraud and Revenue Assurance

The impact of telecom frauds such as international revenue share fraud and SIMbox cloning on telcos’ revenues is huge. Global Fraud loss estimate is about $29.2 Bn annually (Source: 2017 Global Fraud Loss Survey) for instance. The risk grows multifold as the telcos move to advanced networks like LTE. Due to the high bandwidth and the advanced capabilities of the devices connected to these networks, monitoring these activities becomes a real challenge.

Real-time revenue monitoring is the only way to address the revenue loss associated with call frauds. The telco should implement a robust fraud management practice that helps them analyze both expected and historical usage pattern to proactively address revenue leakage. With real-time analytics, usage can be monitored across different types of services – voice, data and video streaming. A comprehensive fraud management strategy must also encompass other aspects of providers’ environment including the sales channels, networks and the OSS.

In a nutshell : The digital journey of telcos has just begun. Considering the future opportunities, telcos cannot slacken their pace of digital transformation. As challenges around revenue assurance grow higher in the evolving technology landscape, priority should be given to safeguard the revenue across all channels.

Neeraj Upadhyay

Neeraj leads digital marketing for Subex with focus on Website, Search, social media, mailer automation and MIS. In addition to this role, he also looks after product marketing for Revenue Assurance & fraud Management solutions for the company. He comes with over 8 years of experience spanning across sales, product and digital marketing.

Does a Digital Lifestyle offer Operators opportunities, or is the path more ominous?

Capex Optimisation, General, Partner Settlement, Revenue Assurance, Telecom Insights & Analytics

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It stands to reason that the Digital lifestyle of consumers will dramatically impact how operators generate revenues over the next 10-15 years. Transformations are taking place that will move activities, entertainment, commerce, healthcare, transportation, and most other aspects of our lives into Digital modalities. This has invited thousands of micro-providers of applications and networks into the mix, quickly marginalizing the value of the operator to merely an “enabling pipe.” This puts the operator into a competitive situation, ultimately impacting margins. But that’s only on the revenue side of the equation… the story could become far more complex.

For an operator, the days of 25%-40% EBIDTA are waning, if not almost gone (in many regions). Pressures on pricing remain downward, with new product offers being the primary method to sustain acceptable revenues and margins. This has opened the door for some impressive creativity by many operators, especially in developing markets. In many cases no market appears off limits, as seen by the offerings by progressive organizations like MTN in Africa: Who would have anticipated an operator would offer personal transportation services rivaling Uber?

These seemingly odd moves are, in fact, brilliant moves by operators to seek new sources of revenues as their businesses are being redefined by the digital services we are quickly becoming reliant on. The impacts on revenue models due to this change in the business are stunning: Traditional billed services like voice, and even data, are fading in importance. Revenue models are instead focusing more on casual services, pay-per-use services, marketplace services, etc. Put more simply, the “pipe” is no longer where the earning potential lies for the operator.

So now a previously non-agile, large operator business is finding itself competing with, and in many cases partnering with, literally thousands of aggressive, hungry micro-entities that provide products and services accessed by the networks. There is less reliance on monthly guaranteed revenue; the battle for revenue very often resides in millions of micro-transactions.

All of the discussion cannot focus entirely on revenues, however. Margins are also sustained by costs. Agility, therefore, must exist on the cost side of the operator business. In the old world of monthly recurring and predictable revenues, costs could be managed and allocated more confidently. Opex and Capex planning and forecasting practices were based on budgeting with a high degree of certainty. But as revenues models are changing, so must cost models. Where possible, operators will need to employ similar creativity to curbing costs, as they are with earning revenues.

How can operators, therefore, modify cost models in the business to be as aggressive and variable as the revenue models they rely upon? This is where the opportunities for SDN/NFV networks can shave significant costs, while changing operator cost models in ways that were not previously achievable.

Software-Defined Networks (SDN) and Network Function Virtualization (NFV) will allow operators to provide Network-on-Demand and Service-on-Demand models to consumers, while effectively minimizing, if not eliminating the need for human intervention. The costs associated with truck rolls, call centers, and expensive specialized network equipment will be dramatically reduced, resulting in decreased Opex and Capex burdens on the business. The savings need to expand further, however.

In current cost models, operators must deploy and maintain network services around the clock, which consumes significant and ongoing expenses. However, if a network is based on SDN/NFV architectures, the deployed services are no longer in a fixed position in the network, simply because they are now software-defined and/or virtualized. This means an intelligent network can move assets where needed, and when needed. These assets are capitalized as licensed instances; so now an operator can have a pool of 1,000 licenses for a virtual service, and deploy them only as necessary.

This type of dynamic deployment model should allow operators to negotiate dynamic cost models as well; imagine only paying for a license when you have it deployed (and it is generating revenue). While this idea may seem far-fetched, consider that now the network functions we are discussing are no longer controlled by a few network equipment and function providers; micro-entities (application developers) can now produce those functions, often at far less expensive price points.

The business transformations taking place in operators globally are forcing entirely new ways of addressing margin pressures, as the revenue and cost variables operators have historically used are no longer the same. Looking beyond margins in consumer-facing products and services, new network cost models must be explored, especially since those models were based on what is now an outdated means to earn revenues.

John Brooks

Vice President – Product Management – John Brooks serves as the Vice President of Product Management in Subex. He has over 26 years of experience in Telecommunications, spanning Fixed, Mobile, Data, and Video technologies. Within the industry Mr. Brooks was a board member for the GBA, founded the TM Forum Fraud team (authoring the first International Fraud Operations and Fraud Classifications guides), and now leads the TM Forum Network Asset Management team, focusing on transformative best practices for SDN/NFV operations. Over the years Mr. Brooks has served as an Advisory Board member for a prominent technical university, and has spoken at over 50 industry events and authored numerous papers on topics spanning IoT, Digital Disruption, Big Data, and Enterprise Risk Management. With Subex (formerly Connexn/Azure) since 1999, he has directed over 40 successful Cost, Revenue, and Business Optimization engagements at over 24 top-tier carriers globally, including AT&T, America Movil, BT, Vodafone, and Verizon.

Reporting “The Smart Way” in RA

Analytics, Digital, Revenue Assurance

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“As is”
Read the news using your favorite news app on your smart phone or device? Notice how the app renders news items that are important to you or of interest to you and stacks them together with short headlines followed by a short summary thereby making sure that one wouldn’t need to feel short of time finding what really needs to be read.

Is this done in your RA department?

The below diagram illustrates how majority of the RA departments report the necessary information to all concerned departments and how the subsequent action items are publicized and owned by various departments.

Reporting2

In majority of RA functions the following gaps exist in the reporting of findings and their subsequent action points:

• Reports rarely designed with specific information that is immediately consumable by target audience
• Reports rarely designed with specific requirements to the target audience than can be easily converted to action items
• Majority of the RA operations use one reporting template for all business functions

“Smart Reporting”
The below figure illustrates the ideal modus operandi that requires to be followed in a RA reporting structure.

Reporting1

Key improvements in the model are as follows:
• Reports specifically designed to target audience. For example: Reports to CxO will address revenue & cost savings, key mitigation measures taken, not exceed a time length of 5 minutes and requiring specific actions / escalations
• All reports to address specific actions required from various business functions and will be time bound
• Organizational news feeds will be made part of RA reporting

Here the emphasis is on smart reporting, which can be quickly consumed and acted upon.

Srikanth Vasudevan
Srikanth Vasudevan

Srikanth is a Senior Consultant in Subex’s Business & Solutions Consulting vertical, focusing on Emerging Markets. He has over 9+ years of experience in consulting and advisory in the telecom industry with key focus on Revenue & Cost Assurance, Information Security, Governance Risk and Compliance. His client portfolio includes Aircel, MTNL, Tata Communications, Videocon, DST and PGi in APAC; STC, MTN, BTC in EMEA; Verizon, XO, Fairpoint and AT&T in NA.

Revenue Assurance and LTE

Revenue Assurance

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Emergence of LTE

Through the last one decade when telecommunication globally evolved from 2.5G to 3.5G taking along the subscribers from a mere 56 Kbps to streaming of HD videos & music on your handset, data and content has evolved by giant leaps far faster than anyone predicted. The evolution not only provided a broad variety of services to the end users but also magnified the economics of content provision, VoIP services and eCommerce by leaps and bounds.

A far cry from just using you mobile phone for voice and SMS, the thirst for data from the end users of today sends out a clear message that even the speeds offered by 3G networks fall short of the requirement. So much so that this evolution is slowly but steadily diminishing the traditional circuit switched voice traffic.

The below stats geographically indicated illustrates the current data evolution:

 

Risk Profiling

The evolution of LTE differs not only from an end user product offer perspective but also from the point of network architecture. This makes LTE evolution very different from the 3G evolution wherein only a few components changed along with minor adjustments in xDR formats. These minor changes resulted in majority of the core RA practices to accommodate a 3G risk mitigating process with minor adjustments to already existing controls.

However this would not be the case when it comes to LTE wherein majority of the network components are different with layers of complexity that originates from the perspective of how products are designed and offered.

  • Product Design

When it comes to how RA facilitates product design in an LTE network we must take note of the fact that very few RA practices today have a functioning RA process that contributes to marketing campaign, product offer development and change management in a 2G / 3G / fixed line / broadband environment. The primary reason being that majority of the RA operations still concentrate towards leakage detection and not revenue enhancement.

However in the case of LTE where subscribers have access to multitude of content and eCommerce in a market which is growing at a rate of 30% – 55% at any given geographical market coupled with thinning bottom lines, here RA processes for product design becomes far more important in the insights that can be generated through various multi-dimensional usage modeling.

  •  Order Management & Provisioning

Unlike a 2G & 3G environment wherein the subscriber service configuration is spread across the order management system, HLR, IN and billing in an LTE scenario the scope of risk is drastically amplified due to the dynamic allotment of service elements in the PCRF as per a designated service plan.

Herein any risk mitigation process begins with the analysis of services allocated at order management, subscriber’s historical usage and the subsequent policies that are dynamically enforced by the PCRF.

  • Rating and Billing

LTE brings in complexities within each service plan wherein the rating differs across each and every data session initiated by a subscriber. For instance, if a subscriber is streaming a video / music and simultaneously texting through a popular messaging service the corresponding rating will also differ specific to the plan associated to a session; in this case video stream will be rated differently from the messaging service. Here again to add another layer of complexity, rating can also differ on the QoS guaranteed to an end user.

Evolution of RA

It becomes fairly clear that majority of the traditional controls that has been used for a 2G & 3G scenario cannot be reused for RA in LTE thereby paving the way for RA evolution along with the corresponding LTE evolution.

One of the important takeaways in the evolution of RA is the importance of analytics for revenue reporting / projections through multi-dimensional data modelling which is a must in a LTE environment which thereby provides a multitude of insights on subscribers, products, network utilization and revenue generation.

Srikanth Vasudevan
Srikanth Vasudevan

Srikanth is a Senior Consultant in Subex’s Business & Solutions Consulting vertical, focusing on Emerging Markets. He has over 9+ years of experience in consulting and advisory in the telecom industry with key focus on Revenue & Cost Assurance, Information Security, Governance Risk and Compliance. His client portfolio includes Aircel, MTNL, Tata Communications, Videocon, DST and PGi in APAC; STC, MTN, BTC in EMEA; Verizon, XO, Fairpoint and AT&T in NA.

Mobile data offloading & Revenue Assurance

General, Managed Services, Revenue Assurance

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Emergence of mobile data offloading

Though mobile data offloading is not new to the industry it is catching steam off late and that has made operators around the world take notice. The factors that are driving mobile data offloading is the ever growing smart phone market giving people the option of streaming any content of the internet right on to the palm of their hands.

Surprisingly it is not “work on the move” that is making a large percentage of the populace download content through their smart phones extensively but the driving factor happens to be  streaming of video content from sites such as YouTube that ranks at the top of data usage .

Key industries can’t afford to ignore the trend especially when recent industry research predicts that nearly 50-60% of the data would be offloaded by the year 2017 by either WiFi, WiMax or Small cells with WiFi being a major player over the latter two.

Why offload with begin with?

At a time when cellular operator costs are going up due to investments in 3G and 4G network evolution, WiFi still ranks at the top for data offloading primarily due to 3G/4G pricing, poor signal reception indoors and WiFi’s higher bandwidths offerings with little or no interference.

The three factors put together are the leading cause for smart phone / tablet data usage being offloaded to a WiFi network.

A simple iPad sales figures of 2012 provides a interesting insight into the fact that 9 out of 10 iPads are only WiFi show casing a interesting find that cellular data services has been given a miss at the highly sought iPad retail market itself

“A little known fact is that contrary to popular belief a smart phone / tablet also uses lesser battery when connected to a WiFi network accounted due to the lower signal strength requirement.”

The benefactors

Apart from the end users who get excellent bandwidth, speed and zero interference reception; the businesses which provide broadband services to end users cash in by filling in the gaps between the cell towers, literally.

A few OPCOs in the wireless business who also double up by providing broadband services in the form of ADSL or FOC loop back their users into their network business.

How can RA help?

Analytics, analytics, analytics!!!

“The true potential of analytics is only limited by ones own imagination of what can be done with an array of data at your disposal”

Here RA’s primary role comes in as a revenue enhancer or opportunity loss identifier and not as the more commonly known roles of “leakage identification”.

From an RA perspective looping in key information of users such as the data usage pattern over cellular and WiFi and overlaying them over various dimensions of demographics, content, customer categorization and lifestyle components will provide an insight on potential cellular onload or offload opportunities which can be monetized by provision value add or add on services to potential users.

From an operators perspective this insight can increase revenues especially in regions where a good smart phone markets show below par cellular data usage therein operators can increasing their service offerings to targeted localities and users in the form small cells, WiFi, or  WiMax.

Srikanth Vasudevan
Srikanth Vasudevan

Srikanth is a Senior Consultant in Subex’s Business & Solutions Consulting vertical, focusing on Emerging Markets. He has over 9+ years of experience in consulting and advisory in the telecom industry with key focus on Revenue & Cost Assurance, Information Security, Governance Risk and Compliance. His client portfolio includes Aircel, MTNL, Tata Communications, Videocon, DST and PGi in APAC; STC, MTN, BTC in EMEA; Verizon, XO, Fairpoint and AT&T in NA.

Factors Complicating Assurance in 4G Environments

Featured, Fraud Management, Revenue Assurance

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GSMA has a vision for 2020 for Telecommunications Industry around connected living which focuses on main pillars which are expected to drive the industry forward, namely – Network 2020, Personal Data, Internet of Things and Digital Commerce.

As per my view, the single most important take away from that vision is the rise of Telco 2.0.

Telco 2.0 are those telecom operators which are expected to expand transformationally by taking risks to chase higher rewards in both known and as yet unknown new parts of the value chain. These are expected to be the most advanced & disruptive Telecom Operators.

Telco-2.0

The most important enabler of these, so called, Telco 2.0 operators would be the ‘platform’ which would allow them to explore & experiment with those unknowns and expand services while ensuring higher customer experience which will help them achieve that visionary status.

One of such platforms is 4G, which riding on the inability of 3G-3.5G networks in delivering the required quality of service, has shown tremendous adoption rate within operators over the years.

What has made 4G enabled networks so popular is its proven capability as an ideal platform for cross domain services convergence & all access technologies.

A comparison between 4G LTE & HSPA (~3G) based network and service delivery capabilities can be seen below:

consumer-content

The bitmap above also provides a crude reasoning around lower adoption rate of certain services which were also rolled out over 3G enabled networks, but did not meet the consumer expectations around quality, reliability and price.

4G based networks provide the ability to the operators to become the ‘Real’ converged service providers, which until 3G was more theory than practicality. Operators are now becoming OTT service providers including communication, social media, social network, content, advertisement etc., connected living enablers, enterprise enablers etc. which was, until now, being offered mostly by 3rd parties.

With operator owning the converged service offerings (or at-least controlling some part of the service delivery like quality etc.), the increase in traffic over its pipes has shown potential of increase in direct revenues, that too proportionately.

Factors influencing complexity in 4G environment

Yes. 4G is great! But, not without the share of complexities it injects in the area of assurance (RA & Fraud) operations.

The following variables are identified to be the main influencers with respect to complexity and uncertainty in 4G environments:

New Network Elements

4G introduces new set of network elements and O/BSS systems generally being customized in terms of design or implementation as per the operator raising concerns around interfacing, data availability or quality. This also points to increase in complexity & volume of RA & FM activities to be performed due to increased data sources and controls.

Also, a lot of components in 4G implementations are still not COTS and provide different logging & access levels which raising concerns around capability around identification of internal frauds and external access attempts/brute force attacks.

Parallel Networks

Traditional networks including certain components adopted from 2G, 3G environment and running in parallel to enable backward compatibility and interconnection leads to further increase in risk, complexity and number of controls to be managed.

Non Standard Implementations

Some areas of 4G network, O/BSS systems and interface partnerships (operator, content providers etc.) are being implemented in customized non-standard fashion to enable interconnections (including roaming approach) and support complex products and service offerings (like VoLTE or VoLTE roaming etc.). The situation is more of an experiment and working towards developing a standard rather than following one.

Lack of reference 4G RA & FM practices combined with custom implementations, RA & FM activities are expected to be driven by non standard data sets and frequencies until stability/maturity.

Initially in 4G space, RA & FM practices may be exposed to the scenario of ‘Incident induced learning’ or ‘reactive RA & FM’.

Higher Convergence

Higher convergence of ‘core’ telecom operator provided services introduces more ‘direct’ risks to the operator and an increased need to manage RA & fraud risks introduced by the new services, which in an earlier setting, was a headache of the third party service provider.

New Pricing Models

Conversion to charging policies from minutes to bytes (sessions) and bytes to service subscription & access mixed with complex bundling packs & rate plans is expected to change the traditional mindset of conducting RA & FM, especially around charging, discounting, billing & invoicing.

Disruptive roaming charging policies are also expected to be introduced which will change the perspective further.

For session based charging policy, verification of policy implementation is also expected to impose its own set of challenges.

Complex service offerings

Telecom operators are going beyond their traditional service offerings (Apart from voice and data – TV / content / cloud etc.) and venturing into the modern areas revenue generation such as content, advertisements, connected living etc.

Rich content (VoD, music, messgaging, magazines etc.) management & delivery to become the fulcrum 4G revenues. Also, with various channels of content delivery at hand, advertisement revenues will also play an important role for mature 4G operators

But, service based subscriptions, validity & dynamic delivery along with innovative & complex content and partner agreements are expected to complicate the RA & FM activities like never before.

Increase in transaction volumes

4G subscriptions is expected to increase 3.5 folds to 1.3 billion and data traffic by 6 folds to 17 Exabytes by Dec 2018. Operators will be dealing with many fold increase in data per unit of earned Revenue.

Considering revenues are tied to data sessions, transaction volume mgmt. for the purpose of RA & FM is expected to introduce a big challenges and would require advance data treatment, management & analysis techniques (e.g. Big data).

Responsiveness & Scalability is expected to be one of the main talking points with respect to volume management

Rapid Product & Services Launch

New product, package and service launch across the breath of 4G enabled service platforms are expected to see a considerable rise in throughput due to shortened development, delivery & release cycle.

The agility of RA & FM departments in terms of proactive assessment and risk readiness is expected to keep pace with the higher number of products, services and packages being launched at the breakneck speed across the breath of business offerings

Margin Management & Revenue Enhancement

With increased competition, Revenues are expected to be driven by high volumes and low margins and not high margins. Product performance measurement in terms of adoption and revenue generation against target will have to be carried out at much higher frequency.

With RA having and access to all cost items, charging, payins/payouts, usage records, quality parameters and first visibility to trends and anomalies, margin management and revenue enhancement activities are expected to take center stage

Skill set and technology within the team will have to be enhanced or absorbed to enable and handle increased cross functional interfacing , analytics and product management

Lack of Skill Set

Lack of mature reference 4G implementations is also expected to lead to lack of required skill set which is needed to manage and continuously improve the RA & FM operations. There will be focus on more laborious, reactive & risk prone approach of skill ‘creation’ rather than ‘absorption’

Updated Network Access Authentication Methods

Operators need risk readiness against newer authentication methods which are different for different services – ISIM, USIM, Single Sign On etc. Considering device authentication & security is in the hands of the manufacturer or the OS provider,  any security flaw is a direct risk to the subscriber base of the operator

Also, 3rd party firmwares & apps are readily available for the assistance of hackers. This situation increases the device or OS takeover further.

Increased UE & CPE Types

Exponential increase in multi vendor UE & CPE types has increased user exposure to IP frauds like takeovers (Accounts or UE) enhanced by ‘easy’ service access methods such as ‘single sign on’ for single or multiple services.

While user equipments are highly exposed to malicious Apps, URLs, Malwares etc., readily available custom firmware for Customer Premise Equipment are found to expose them to the same level of risks.

To top it off, high profile sensitive customer information hacking cases by external sources are on the rise both against individual subscriber and enterprise networks, calling for much more robust, secure and continuously improving infrastructure and detection capabilities.

Power user exploits

Power users or technology aware users are expected to exploit any loopholes in the implementation of service access, newer pricing models etc. through the use of various complex techniques such as URL masking etc. to bypass charging and gain free access to services

Spoofing or device configuration updates like MAC Address may also gain popularity to help divert charging to someone else in absence of adequate authentication and multi level device binding mechanisms

 

Movement to 4G or a higher capability environment is inevitable.

I believe, if traditional approach to manage RA & FM operations is continued as it is even for 4G environments, these functions are expected to attract steep investments to manage complexity factors mentioned above (including increase in network elements & O/BSS systems, data streams, data loads, controls, resourcing, technology requirements etc.).

There is an immediate need of shifting from current mindset and adopting “Smart” & “Agile” RA & FM practices across the operational spectrum (of people, process, measurement, organization & technology) to contain costs and risks much more efficiently.

Taking a cue from Game of Thrones – “Winter is coming! and this one will be long. God help us all if we’re not ready!”

Abhijeet Singh
Abhijeet Singh

Abhijeet is currently working as Principal Consultant with Subex.

He specializes in Telecom Fraud Management and his 360 degree experience in this field includes extensive exposure in Fraud Operations Management, Consulting & Advisory, Risk & Health Assessments, Business Development – Product & Managed Services and Analytics.

Out of professional life, he is a blogger, tech enthusiast and a traveler.

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