Newsletters - October 2007

Best Practices for Billing Integration

System integrators can often have a unique and useful view on the current rating and billing trends and demands of the telecommunications market as they work closely with both service providers and billing vendors. Eric Canneva, Project Director of Telecom & Media at Capgemini and Fergus O’Reilly, VP of Product Strategy at Highdeal explore the market convergence of retail and wholesale telecommunications providers and the best practices for billing integration.

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  Eric Canneva,
  Project Director of Telecom & Media,
  Capgemini

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  Fergus O’Reilly,
  CTO,
  Highdeal

• Transaction Reporter: Transaction Reporter: From a system integrator’s point of view, how would you categorize your customers’ billing needs and trends?
  • Eric Canneva: Many different types of companies, even in traditionally non-competitive industries, are trying to grab their share of the tremendous growth expected in the broadband services management market. This leads to opportunities both for competition and cooperation. From traditional telco’s and cable companies to next-generation communication providers offering WiMax and satellite, they are all moving towards satisfying end users. These new stakes all require telecom operator strategies to be continually adapted to deliver sustainable advantage. So for Capgemini Telecom, Media & Entertainment and Highdeal, it is about demonstrating how we can harness technology-driven performance for our clients. Our customers need to have the capability to bill for any service (telephony, music, movies, TV channels, …) through any operator’s pipe (ISPs, carriers, new players, cable and satellite operators) and for all business models (B2B, B2C). They also need a billing system that can handle the increasing number of financial transactions between the different players. While it gets less attention from the telecommunications industry, in our eyes, the major market trend driving our customers’ billing needs is the convergence between the retail and wholesale markets. Regional demands are forcing many of our customers to increase their market share in order to survive and the majority of our customers are either retailers moving into the wholesale market or wholesalers moving into the retail market. Some of our customers are being forced to become direct players and billing specific end users for services, while others are becoming wholesalers, for mostly bandwidth, and billing the resellers in order to remain competitive. This market convergence is particularly advanced in France right now, but I expect other countries will catch-up quickly as well.
  • Fergus O'Reilly: At Highdeal we see this same trend emerging around market convergence. It is almost becoming a rarity to find a service provider that has just a single simple business model these days. Intense competition forces companies to look very closely at what their core added value is, and many then find that this value can be packaged and sold in different ways to different types of customers and partners. As business models and company roles become less rigid the value chain disaggregates and can then be recombined and recomposed to unlock hidden opportunities. The faster service providers can adapt their business processes to take advantage of this trend the better they will be able to compete.
• TR: Do your customers’ needs differ based on the company’s history?
  • Eric Canneva: Our customers’ business needs are generally similar, but depending on their history, their project needs are not. For greenfields, time to market is key, but for incumbents, retention and therefore the quality of the system migration is more important. In general, we develop our deployment strategy depending on the company’s history. For incumbents who are replacing either a part or all of their system, their biggest priority is to have a seamless migration to the new billing system that would ideally have no impact on their legacy systems. For new players, time-to-market is their biggest challenge. They want a system that can be launched quickly and they do not care about migration.
  • Fergus O'Reilly: Complete system migrations can be quite risky: for the larger service providers it is a "bet your job" project for the CIO. And there have been some spectacular high-profile failures. At Highdeal we prefer to take the approach of adding flexibility only where it is required. Very frequently we find that much of the existing systems in place do not necessarily need to be replaced. For example, if the business need is to speed up the introduction of new tariff plans, add promotional pricing, or add a dash of real-time online credit control, then the solution should look at changing or augmenting the pricing and rating systems in place. But the existing back end invoice production, payments and collections systems may be perfectly fine and not need replacing. We have had much success with this approach since it dramatically reduces project risk and the time to ROI.
• TR: How do the payment methods the service providers are offering or would like to offer affect their needs?
  • Eric Canneva: Predominantly, our customers are offering postpaid services combined with real-time charging for security reasons.
  • Fergus O'Reilly: For service providers who currently do the majority of their business using postpaid billing there is not yet a big drive to add prepaid payments. Instead, there is a desire to add real-time charging to offer spending control both for the service provider and for customers themselves. In addition, back to our earlier discussion around market convergence and the multiplicity of business models, we see a lot of service providers wanting to get a real-time picture of where they stand, needing to have daily revenue recognition and reporting on cash flows throughout the business on both the revenue and costs sides. Having a real-time charging system in place makes this possible.

  

• TR: Can you describe the benefits of your partnership with Highdeal?
  • Eric Canneva: The Highdeal solution has the flexibility we need on multiple levels. It supports all of the different products, services that our customers ask for. Capgemini manages end-to-end control of quality of service and flexibility, ensures a services oriented architecture and therefore all kind of business models may be implemented. The combination of Highdeal and Capgemini enables companies to continually develop innovative and effective business models. A key benefit of our partnership is that Highdeal has both prepaid and postpaid billing expertise and Capgemini has the capacity and the experience to integrate and adapt the Highdeal solution to any set of business models. Through integration of Highdeal for both B2B and B2C projects for the ISP market, for example, we have experienced the following:
    • Customers can adapt the features, business logic and technical capabilities offered by the Highdeal technology to their individual billing processes. This is possible because the capabilities of Highdeal are all available through highly configurable GUIs and a rich set of APIs. We can then develop layers on top of this to use just the capabilities the customers require in the way in which they require them.
    • Customers can implement recurring, one-off and usage charges for any service, such as VoIP and IPTV. They can create bundles and discounts across segments and with multiple partners and importantly, our customers can develop billing processes and building blocks that can be used for both retail and wholesale offers.
    • If the customer has an existing legacy system, our joint solution can go alongside the existing system and customers add flexibility only where it is required without having to replace the entire system.
  • Fergus O'Reilly: Highdeal purposefully designed its software solutions to be very Systems Integrator-friendly. We operate on a pure software vendor model where we rely on strong partners like Capgemini to apply their deep market knowledge and broad technical expertise to deliver a total solution to customers. To support this we have made our software as open and as modular as possible. There are no "hidden APIs": if a piece of business logic or a business data object exists in the Highdeal software then you can be sure it comes with fully-documented APIs to manipulate it. This has allowed Highdeal to focus on development of a highly configurable core solution that has proven flexibility across very different industries and across very different business models. Then our customers, with the help of partners like Capgemini, can adapt the solution to their current business needs, while being confident that the system can keep pace with their business as their needs evolve in the future.
• TR: What are some of the challenges and recommendations you give customers based on the various market needs discussed above?
  • Eric Canneva: A lot depends on each individual company's history. For incumbents our frequent recommendation is to look at gradual changes to their infrastructure, adding flexibility and new capabilities where required and using a Service-Oriented Architecture (SOA) approach to ease integration. For greenfields the focus should be on getting things right from the start and reducing overall process costs: things like using online invoices instead of paper. Some of the most challenging projects are those involving significant system migration where you might have to migrate multiple years of billing information history and still have the capability to produce any invoice at any time. Telecom product catalogs, offer structures and rate plans are also necessarily very complex, especially when the operator is managing combinations of retail B2C, enterprise B2B and wholesale businesses. These must therefore be migrated with careful attention to detail.
  • Fergus O'Reilly: A big focus for the majority of our customers is on lowering overall TCO. This can be achieved by streamlining processes and using SOA approaches for flexible integration as Eric mentions. There are also clear benefits from doing more with less: using a single system to manage multiple parts of the business model from retail billing, to enterprise billing to partner settlement. And the solution must be designed for ease of maintenance and ongoing changes. Competition is only getting more and more intense for our customers and they need to have the ability to lead the market by making changes to their prices, tariff structures and even revamping their business model on very tight schedules. Changes must be done in hours and days: if it takes you weeks or months to make changes then the competition will take advantage of that mercilessly
• TR: What would you highlight in terms of integration best practices that you offer to customers and how the Highdeal solution supports these?
  • Eric Canneva: A key best practices that we deliver for our customers is a strong SOA approach: service-oriented billing. We also know the right way to approach the difficult area of product catalog integration between a billing offer catalog and the commercial view of the offers in the CRM system. Lastly, I would highlight our ability to right-size the level of automation that should be done throughout the billing processes depending on the customer need and the cost of automation. From an integration point of view Highdeal has both the modularity and rich API set that are required to allow us to build customer solutions that adapt closely to customer needs, timeframes and budgets. Another key best practice is also to leverage the experience gained across different projects: we do this by coordinating all Highdeal projects through a single delivery center.