Mobile content is becoming a money spinner, but the challenge now is finding the best way to bill for these services. Andy Wilson says the networks are potentially missing out on a huge revenue opportunity while their infrastructure is used as a delivery channel.
Analysys Research suggests that mobile content and entertainment services accounted for 2% of total mobile service revenue and 16% of non-voice revenue in 2002, and is expected to grow to contribute to 11% of total mobile service revenue and 34% of non-voice revenue in 2008. Mobile content will soon be responsible for a significant part of ARPU growth in Western Europe over the next five years, resulting in the drive for telcos to produce and sell content to customers.
But payment for these services is being delivered into the hands of the third party content providers, meaning telcos are potentially missing out on a huge revenue opportunity while their networks are used as a delivery channel.
This poses a number of challenges for telcos – how to make more money from content, and how to bill for it effectively .
At present third party suppliers tend to charge for their services using premium-rate SMS messages which the handset user pays to receive.
Unfortunately, many continue to send these messages as well as offers of additional content, long after the original material was requested. This can end up costing the handset user a great deal of money; it also makes the user wary of downloading anything in the future.
At a glance
Users need to be able to clearly see how much they are being charged for downloads.
For businesses, there’s an extra problem: organisations need to ensure that personal downloads are paid for by the employee and not by the business.
Most post-billing cost allocation systems do not easily differentiate business and personal usage. For example, dual SIM devices (requiring the user to switch between a business and a personal number) can add extra complexity; the telco has to send two different bills, increasing costs and the credit risk of chasing two different payments.
Another popular identification method is adding codes such as an asterisk after the dialled number to separate business from personal usage. That enables the telco to sort the phone bill by these codes, but this is an ineffective solution for separate data usage from voice calls.
But payment for these services is being delivered into the hands of the third party content providers, meaning telcos are potentially missing out on a huge revenue opportunity while their networks are used as a delivery channel.
This poses a number of challenges for telcos – how to make more money from content, and how to bill for it effectively .
At present third party suppliers tend to charge for their services using premium-rate SMS messages which the handset user pays to receive.
Unfortunately, many continue to send these messages as well as offers of additional content, long after the original material was requested. This can end up costing the handset user a great deal of money; it also makes the user wary of downloading anything in the future.
At a glance
Users need to be able to clearly see how much they are being charged for downloads.
For businesses, there’s an extra problem: organisations need to ensure that personal downloads are paid for by the employee and not by the business.
Most post-billing cost allocation systems do not easily differentiate business and personal usage. For example, dual SIM devices (requiring the user to switch between a business and a personal number) can add extra complexity; the telco has to send two different bills, increasing costs and the credit risk of chasing two different payments.
Another popular identification method is adding codes such as an asterisk after the dialled number to separate business from personal usage. That enables the telco to sort the phone bill by these codes, but this is an ineffective solution for separate data usage from voice calls.
"Third party providers risk damaging the public’s perception of downloadable material with their unfriendly billing methods ..."
Both approaches require the user to remember to use these solutions and are only appropriate for the division of voice rather than data, Ryder Systems has developed a web-based solution which allows the user to quickly tag calls, data downloads and SMS text messages as either personal or business. Once allocated, telephone numbers are then remembered eliminating the need for the same numbers to be allocated over and over again. When all usage has been allocated on the monthly bill, the handset user then submits the information for payroll to deduct personal spend from their salary, ensuring the company only pays for business usage and the telco only sends one bill.
When any organisation equips its workforce with mobile handsets, it opens itself up to a number of risks. Businesses need to set clear acceptable phone use policies, similar to those governing IT devices, while giving users the freedom to use handsets at will.
Cost allocation tools give the organisation greater control over ensuring the handset users pays for all usage, and Ryder’s solution is one of the first such tools to be web-based tools, allowing the user to allocate all usage from voice and data as either personal or business.
When any organisation equips its workforce with mobile handsets, it opens itself up to a number of risks. Businesses need to set clear acceptable phone use policies, similar to those governing IT devices, while giving users the freedom to use handsets at will.
Cost allocation tools give the organisation greater control over ensuring the handset users pays for all usage, and Ryder’s solution is one of the first such tools to be web-based tools, allowing the user to allocate all usage from voice and data as either personal or business.
Contentious
Mobile content is a contentious issue. Third-party providers, with their monopoly over the market, risk damaging the public’s perception of downloadable material with their unfriendly billing methods. This isn’t necessarily a bad thing, it is the telcos who stand to gain as users move from third-party providers back to billing systems provided by their network operator.
Tools such as SplitBill significantly help telecoms managers within organisations efficiently and effectively manage the monthly bill. Benefiting all parties, the individual handset user only needs one handset, which is generally of a higher specification and all voice and data usage is charged at a preferential business rate, which tends to be cheaper than personal rates.
This leads to an increase in usage and the telco benefits from increased revenue. But the major benefit is for businesses, who can easily reclaim personal expenditure through a simple automated solution.
Mobile content is a contentious issue. Third-party providers, with their monopoly over the market, risk damaging the public’s perception of downloadable material with their unfriendly billing methods. This isn’t necessarily a bad thing, it is the telcos who stand to gain as users move from third-party providers back to billing systems provided by their network operator.
Tools such as SplitBill significantly help telecoms managers within organisations efficiently and effectively manage the monthly bill. Benefiting all parties, the individual handset user only needs one handset, which is generally of a higher specification and all voice and data usage is charged at a preferential business rate, which tends to be cheaper than personal rates.
This leads to an increase in usage and the telco benefits from increased revenue. But the major benefit is for businesses, who can easily reclaim personal expenditure through a simple automated solution.
Andy Wilson is Sales and Marketing Director of billing systems specialist Ryder Systems.