A ‘perfect storm’ of roaming workforces, new devices and data services combined with a lack of spending visibility for enterprises is resulting in widespread bill shock which is costing Communications Service Providers (CSPs) millions of dollars per month in billing disputes and subsequent bad debt write-offs.
That’s according to new research from Stratecast which reveals that although the enterprise sector signs lucrative long-term contracts with CSPs that deliver up to 40% of total annual revenue, between 10% and 15% of this revenue is being written off by CSPs every month due to disputed roaming and data charges. Indeed, this percentage equates to over US$20m for 60% of the CSPs interviewed.
The research shows how CSPs and their enterprise customers can benefit tremendously from real-time transparency and spend control to minimise bad debt write-offs, improve KPIs and decrease churn.
Karl Whitelock, director OSS/BSS Strategy at Stratecast, explained that CSPs were exposed to unpredictable financial risk when enterprise customers disputed bills.
"Also, the dispute resolution process can be protracted, and there’s no guarantee that individuals or entire enterprises won’t churn to another CSP at the end of the process,” he said.
Dave Labuda, founder and CEO of MATRIXX Software, said that in his opinon the research offered further evidence that real-time enterprise spend controls offer tremendous financial benefits to CSPs and enterprise customers.
“A real-time view of corporate spending would offer enterprises the information they need to make informed budget decisions, avoid billing disputes and more accurately predict communications costs,” he said.
Interestingly, on the consumer side of things, a study put together by Billmonitor found that mobile phone users in the UK were themselves guilty of wasting nearly as much as £5bn a year on the wrong contracts.
Much of this was down to users over-estimating how many minutes they would spend on the phone, with the fear of ‘bill shock’ leading them to buy around four times more talk time than they used.
Indeed, more than three-quarters of those surveyed actually never exceeded monthly allowances of free minutes because they were on needlessly large contracts.
