Digitalised DSP operations: Revenue management evolution to a monetisation platform
There are three journeys that Communications Service Providers (CSPs) must make to become modern Digital Service Providers (DSPs):
- Operations innovation – “digitalising” the operations to be more on-line and automated for consumers
- Service innovation – providing new digital services
- Network innovation – supporting the business with an agile, virtualised next generation network.
The first BLOG post of this series outlined the overall focus changes necessary in the current Operations Support Systems/Business Support Systems (OSS/BSS) to support the digitalisation of the CSP’s operations. The second article of the series focussed on the customer care area. In this piece we cover revenue management, the largest of the BSS/OSS markets, says Mark H Mortensen, practice head, Analysys Mason and John Abraham, lead analyst for Revenue Management.
Revenue Management has evolved from its humble post-paid billing origins to the largest and most important function in Business Support Services (BSS) for CSPs. Revenue management software, support and professional services is over a $21 billion market.
To support a CSP’s evolution to a digitalised operations DSP, revenue management systems must evolve to become an overall Monetisation Platform with several key characteristics:
- Provide customers with the very latest data on their usage and fine-levels of control of usage by all parties on the bill
- Enable rapid changes to the products and services supported
- Support micro-segmented or even personalised services
- Support the rapid onboarding of third-party suppliers of goods and services, who will become even more important as DSPs begin their “Superbundling.”
To support these functions, a number of key capabilities are required, as shown in Figure 1. It is broken down into the basic functions needed by a DSP, more advanced functions that have proven themselves in the competitive marketplace (we call it the “Gold Zone” – those functions that have “jumped” the innovation gap and are ready for wide-scale deployment, going into a fast diffusion into the market – usually in top tier CSPs, followed by lower tier CSPs), and those unproven, but that leading-edge CSPs are currently trying to extract competitive advantage from.
Figure 1: The evolution of revenue management systems into a DSP monetisation platform [Source: Analysys Mason, 2016]
Basic functions include:
- A single bill from the CSP/DSP (yes, there are still some CSPs who do not have that capability – they even argue that their customers do not want a single bill).
- Account information that is up-to-date, although a debate is ongoing as to how real-time this has to be, with opinions from 5 milliseconds to 5 minutes.
- A level of sophistication that recognises that there is not a single user of the account
- The ability to present the account balances and other information on line.
The Gold Zone functions that have proven themselves to be valuable include:
- Real-time convergent charging systems, used for both post-paid and pre-paid services that have the ability to support the real time information needs of DSPs
- Low latency in its data limit controls, requiring policy management closely integrated with the charging function.
- On-line mediation systems that are capable of being a real time data repository that CSPs can leverage for data driven decision making
- Robust APIs for third-party onboarding functions that allow goods and services from other parties to be quickly offered by the DSP.
The Advanced functions, not yet fully proven in the marketplace to be worth the cost and effort of implementing, but looking good include:
- A master product catalogue that synchronises the (inevitable) multiple product catalogues of the various charging, and perhaps, billing systems.
- More sophisticated digital onboarding functions that allow a new third-party, and their goods and services, to be quickly added to the product list.
- A virtualisation of the software, running in a private, hybrid, or public cloud.
- Automation of the product lifecycle management as new services are proposed, vetted, designed, approved and put into effect.
There are many other, new functions that are in the market, some will prove themselves and be added to the list of Gold Zone functions. Others will fall by the wayside.
The authors of this blog are Mark H Mortensen, practice head, Analysys Mason and John Abraham, lead analyst for Revenue Management.
About the author:
Mark is research director for Analysys Mason’s BSS systems, which are part of the Telecoms Software and Networks research stream. His interest areas include customer omni-channel self-service, operations systems enabling new CSP businesses in the digital economy value chain, and creation and support of differentiated services aimed at high-value customers.
Mark was chief scientist of Management Systems at Bell Labs, and has also been president of his own OSS strategy consulting company, CMO at the inventory specialist Granite Systems, VP of Product Strategy at Telcordia Technologies, and an professor of Strategic Management at UMass Lowell.
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