One Bill Fits All Services

Telecom companies have a new battle to face with telecom reform: How to charge customers

P> What do personal communications services companies, paging companies, wire line and wireless companies, cable television operators and direct broadcast system broadcasters have in common? They don't know how to bill for their services. The telecommunications reform bill may be great for the emerging supercarriers, but they could be forgetting one thing -- how to bring in revenues.


Competition among the telcos has moved billing operations from a back office function to a marketing function.

So with more than 500 long distance carriers and 1,300 local exchange carriers in the United States, "the billing and customer care market [is worth billions of dollars]," said Robert Rosenberg, president of The Insight Research Corp. in Livingston, N.J. "The operations support systems is a crucial aspect of the new telecom environment."

Current billing systems operate on mainframes. And these systems present several problems for telcos. The introduction of new services is delayed due to the multitude of transaction formats and systems on current back office systems. Also, increasing mergers and acquisitions, as well as strategic partnerships, heighten the need for integrating billing systems. The back office operations must be able to merge with their management.

LinguaTeq in McLean, Va., is one of the companies expecting to profit from these trends. The one-year-old company is releasing a transaction conversion system later this year to target telecom companies. The system can translate incompatible electronic records into a common format that can be read immediately by a company's computer systems without the need for constant reprogramming.

The product targets future supercarriers and eventually health-care insurance providers. Founders Bob Doyle and Dale Williams, former product managers and systems developers at AT&T, said current back-office systems often hinder entry into new markets. Sometimes companies are forced to offer free services because they don't know how to bill for them.

"Every major carrier is thinking of how to consolidate," said Doyle. "With their current systems, they attempt to build another system each time they come out with a new product." Traditionally, companies have been more concerned with being first to market rather than thinking about how they will bill for new services.

Williams and Doyle are talking to several local and long distance carriers; their product comes out in the third quarter.

Susan Reiche, a spokeswoman for AT&T, said telcos need integrated billing systems to provide one bill for all services, but the implementation is far off. The company, which recently started offering home entertainment services, is talking to contractors about integrated billing systems.

Saville Systems of Burlington, Mass., has provided convergent billing software solutions to the global telecommunications industry since 1982. The $30.3 million company, which targets only telecom companies, designs software to bill multiple services on a single invoice. According to John Boyle, president and CEO of Saville Systems, convergent billing allows companies to get to the market more quickly, introduce new concepts and integrate new back office systems as the business grows.

"The market for this is very big and very dynamic," said Boyle. "Billing used to be thought of as an afterthought, and now companies are starting to think of billing as value-added."

According to a study published by Insight Research, the entire market for telco operating systems was $14 billion in 1995 and will grow to $26 billion in 2000. Billing, customer care and their associated systems will continue to be the largest opportunity, increasing from $4.7 billion in 1994 to $9.4 billion in 2000 for global markets.

In the global market, combined back-office spending by wire line and wireless carriers will increase 13.3 percent from 1994 to 2000. The wireless segment will experience the fastest growth, 26.2 percent in North America and 31.8 percent in international markets.

Rosenberg said the ideal system would use a client/server architecture and focus on both billing and customer care. The systems must be scalable and integrate information about a variety of customers -- new and old.

"[Billing companies will] target anyone who is breathing," said Rosenberg. "The real question is how each company is going to differentiate from the next."


Reader Comments

Please post your comments here. Comments are moderated, so they may not appear immediately after submitting. We will not post comments that we consider abusive or off-topic.

Please type the letters/numbers you see above

What is your e-mail address?

My e-mail address is:

Do you have a password?

Forgot your password? Click here
close

Trending

  • Dive into our Contract Award database

    In an exclusive for WT Insider members, we are collecting all of the contract awards we cover into a database that you can sort by contractor, agency, value and other parameters. You can also download it into a spreadsheet. Our databases track awards back to 2013. Read More

  • Navigating the trends and issues of 2016 Nick Wakeman

    In our latest WT Insider Report, we pull together our best advice, insights and reporting on the trends and issues that will shape the market in 2016 and beyond. Read More

contracts DB

Washington Technology Daily

Sign up for our newsletter.

Terms and Privacy Policy consent

I agree to this site's Privacy Policy.