Thursday, December 20, 2012

Blueprint 2013: OSS/BSS Adapts for Complex Services

Customers are tough to get and easy to lose. The good news is that communications service providers (CSPs)have more and more options for attracting and retaining customers. Here are nine strategies that will play out in 2013.

  1. Policy will evolve from a isolated defensive capability to business integral offensive measure. CSPs – particularly mobile operators – currently use policy to a large extent to protect their network. Increasingly they’ll use policy to differentiate their offerings and services based also on customer personal preferences, purchase and usage history. This will require integrated solution between PCRF and OCS, that enables a common product offer creation environment that can be used for both voice and all data product definitions (WCDMA, WiFi, Fixed Broadband).  
  1. CSPs will transform over-the-top (OTT) services from a problem into an opportunity. Consumers want ubiquitous communications services. The only way that CSPs can meet that demand is by accepting that for part of the time, they’ll have to serve their customers over someone else’s network. CSPs also have to accept that other CSPs and OTT providers will use their network to serve their customers. Why? Because no one owns the customer. If a CSP won’t meet their needs, they’ll turn to one that can. 
Instead of viewing OTT services as a problem, CSPs will increasingly look at them as a business opportunity. For example, a mobile operator could provide a certain amount of bandwidth and prioritization to a video OTT provider that agrees to share revenue because the QoS would help differentiate its service.

  1. CSPs will optimize their OSS/BSS infrastructure to accommodate increasingly complex services. Billing and service assurance will become more important for delivering an optimal mobile customer experience. As more services are introduced, and as the underlying network technologies become more complex, CSPs will focus on their OSS/BSS infrastructure as the centerpiece for ensuring a great customer experience. 
  1. Tailored pricing and packaging will become a market differentiator. One size doesn’t fit all. Not every mobile customer, for example, needs or can afford 5 GB per month or 20 Mbps. Tailored packaging of e.g. social media services at a low weekly cost will be one way lower the entry barrier and grow in new segments. With any technology, differentiated pricing appeals to a wider range of needs and budgets, enabling CSPs to cater to all demographics while ensuring profitability. 
  1. Smartphone growth won’t plateau anytime soon. Sure, smartphone penetration is already above 50 percent in markets such as the United States. But globally, it’s only 15 percent. That’s a lot of room to grow, and the grow will happen in customer segments that has different needs and wallets compared to the first wave of smartphone customer. Doing so requires differentiated packaging and pricing and other innovative rate plans and service bundles, which in turn require highly flexible BSS/OSS platforms. 
  1. Mobile broadband subscriptions will continue to grow. There are 2012 approx. 1.5 billion mobile subscriptions in the world. A big figure, and still only representing less than 25 percent of all mobile subscriptions. It is expected to grow to 6.5 billion mobile broadband subscriptions globally by 2018, representing an uptake of over 70% of all mobile subscriptions. So how can operators succeed to win in this new battle for market share and avoid sever price erosion of broadband data pricing. One key requirement will be highly flexible BSS/OSS platforms in order to create innovative and differentiated offerings that appeal to new segments and at the same time avoid price erosion in among existing customers.  
  1. Customer experience will matter more than ever. A reputation for poor service is expensive to overcome. It’s a fact today and it is getting increasingly important tomorrow, as the number of customers that operators are fighting about is not increasing. The increase is in data usage, number of devices and subscriptions. So in order to grow business existing customers need to be maintained especially as the cost for acquiring new customers is very high. Upsell of new services and subscriptions is difficult to customers that are not happy, and on the other hand customers that are happy are likely to buy more, talk well about you, and by that also help creating growth. So make sure that you can deliver on your promise.  For example, if they want to offer business customers a premium experience at a premium price, you first must have the tools in place to assess ensure that experience every step in both the purchase process, activation as well as during actual service usage. 
  1. CSPs will analyze customer behavior so they can capitalize on it. Simply providing a voice-and-data pipe out to a customer and collecting a fee is no longer a viable business model. Savvy CSPs realize this. They are deploying OSS/BSS solutions that enable them to analyze how all their customer (prepaid, postpaid and hybrid) are using their services and then create tailored promotions and tariffs that leverage each customer’s or customer group’s habits and preferences. 
  1. CSPs will turn customer disgust about being blindsided into a business opportunity and market differentiator. The global backlash against bill shock is just one example. CSPs suffer financially, too, when surprised customers become former customers or share their anguish with their social networks. CSPs also have the cost of fielding all those billing inquiries. Those are among the reasons why mobile operators, MSOs and other CSPs will increasingly provide customers with real-time control of minutes, messages and megabytes used. This information is particularly important for customers with shared, multi-device plans, such as a family or small business.
Providing this type of granular information in a timely manner requires an OSS/BSS solution capable of tracking, controlling and aggregating it. This investment also enables CSPs to create specialized offers, such as providing customers who are approaching their monthly allotment with the option of buying another block of minutes or messages at a special rate. This proactive outreach benefits the CSP’s reputation because now customers perceive it as being sensitive to their budget rather than trying to nickel and dime them.

About the Author

Niclas Melin, Director of OSS and BSS Marketing, joined Ericsson in 1995. He specializes in understanding how real-time capabilities in OSS/BSS can improve the customer experience and create value, and has developed a deep understanding of operators’ challenges and opportunities through operator workshops, discussions with industry analysts and his former role as chairman of the Ericsson Charging User Group.

About Ericsson

Ericsson is the world's leading provider of communications technology and services. We are enabling the Networked Society with efficient real-time solutions that allow us all to study, work and live our lives more freely, in sustainable societies around the world.
Our offering comprises services, software and infrastructure within Information and Communications Technology for telecom operators and other industries. Today more than 40 percent of the world's mobile traffic goes through Ericsson networks and we support customers' networks servicing more than 2.5 billion subscribers.