Billing: From the End-Customer to the Partner

• Retail Billing:
  Retail Billing is the process of collecting usage, aggregating it (for charging purposes), applying required usage charges and service rental fees and potentially discounts and interests and finally generating invoices for the customers. This process may also include receiving and recording payments from customers and allocate those payments against open invoices according to specific allocation rules.
• Interconnect/ Wholesale Billing:
  Whilst Retail billing deals with end customer rating, billing & invoicing, wholesale billing deals with the billing process of the following entities depending on the situation and the nature of business:
• Resellers associated with telecom operators, such as Content Providers, Broadband Resellers etc.
• Interconnect partners for providing interconnection in order to enable end customers make calls to OLOs (Other Licensed Operator) customers.
• Roaming partners for providing services to their customers when they roamed in OLO’s coverage area.
• In case when many partners are actually involved (multilateral agreements) in the value chain of a service provision, the revenue sharing model may also be used.
• Partner Relationship Management:
  PRM constitutes a broader concept than billing itself. It’s a platform that actually supports service providers in complex relationships with partners/suppliers and provides core features such as agreements management (SLAs), regulated services support (LLU, WLR), dispute management, routing optimization (LRC, ASR), reconciliations etc. Apparently, such a platform is extensively integrated with the selected billing system.

Minimum Level of Itemization: The Basics for Fixed Telephony

According to the Regulatory Authorities, there are two levels of information of charges provided with an itemized bill; the minimum level of itemization and the enriched minimum one. Both are offered for free by the Telecommunication Operators.

The Minimum Level of Itemization (MLI)

As far as the fixed telephony is concerned, the minimum level of the itemization includes the following mandatory information:

• The Outstanding Balance (i.e. the balance of the account stemming from the previous invoices) 
• The Recurring Charges (i.e. standard fees being paid on a monthly basis) 
• Aggregated information for the prepaid usage within a recurring charge, i.e. information about the calls included into a recurring fee paid in advance, such as: 
• Total number of calls 
• Total actual duration 
• Total billed duration 
• Call Category (on-net local, on-net long-distance, international, mobile, off-net fixed, incoming & outgoing roaming calls, short-digit calls etc)
• Total number of calls per Multimedia Content Provider for providers being served by the Telecommunication Operator’s network, or per Network Provider for calls towards providers being served by Other Licensed Operators (network providers).
• On the same page, there must be a footnote indicating the fact that the total billed duration is often different from the actual one, due to several tariff characteristics like the minimum charge or the charge step; for example 20 second minimum charge even if the call duration is 5 seconds or charge per minute even if the call duration is less or greater than integer minutes. In the case of a modification of any of the aforementioned tariff characteristics, the changes must be explicitly depicted upon the invoice, i.e. the unit prices before and after as well as the exact date of the change in question. 

• Aggregated information for usage outside the prepaid usage, i.e. information about calls not included into a recurring fee paid in advanced, such as: 
• Total number of calls 
• Total actual duration 
• Total billed duration 
• Call Category (on-net local, on-net long-distance, international, mobile, off-net fixed, incoming & outgoing roaming calls, short-digit calls etc) 
• Total number of calls per Multimedia Content Provider for providers being served by the Telecommunication Operator’s network, or per Network Provider for calls towards providers being served by Other Licensed Operators (network providers). 

• Detailed information regarding any financial discounts or penalties applied, such as the service activation fee, the service disconnection fee, the outgoing call barring fee, the Call Line Identification Presentation fee and other debit or credit adjustments.

The Enriched Minimum Level of Itemization (EMLI)

As far as the fixed telephony is concerned, the minimum level of the itemization includes all the previously mentioned information and on top of that the following mandatory details:

• Detailed  information for the prepaid usage within a recurring charge, i.e. information about the calls included into a recurring fee paid in advance, such as: 
• The itemization of the calls, the duration of which exceeds the 2 minutes time. This itemization includes the following information per call:

• The called number
• The date & time stamp of the call
• The exact time when the call started
• The actual duration of the call, referring to the footnote with respect to the billed duration
• Call Category (as previously defined)

• Aggregated information for chargeable calls with billed duration less than 2 minutes time (total number of calls, total actual & total billed duration.) 
• Detailed  information for the prepaid usage outside a recurring charge, i.e. information about the calls not included into a recurring fee paid in advance, such as: 
• The itemization of the calls, the charge of which exceeds the 10 eurocents VAT excluded. This itemization includes the following information per call:
• The called number
• The date & time stamp of the call
• The exact time when the call started
• The actual duration of the call, referring to the footnote with respect to the billed duration
• The charge of the call
• Call Category (as previously defined)
• Aggregated information for chargeable calls with charge less than 10 eurocents (total number of calls, total actual & total billed duration, total charge.) 
• Itemization of calls towards Multimedia Content Providers irrespectively of charge. In this case, the name of the Multimedia Content Provider for providers being served by the Telecommunication Operator’s network, or the name of the Network Provider for calls towards providers being served by Other Licensed Operators (network providers), must be clearly specified.

Other Additional Information

• All subscribers will receive the MLI, unless they explicitly state otherwise
• The provision of the EMLI will take place only upon subscriber’s request
• Primarily, both MLI and EMLI will be provided in a paper form along with the subscriber’s invoice. The subscriber is allowed to ask for their provision in an electronic form; for example the subscriber may very well wish to get the information through his/her e-mail or by accessing Operator’s site using the appropriate credentials (user_id & pin).

Who owns the customer?

Whom does the customer belong to? Where should the customer information reside to? Which is the primary IT system wherein the customer details are kept? Is the CRM the customer master? Is it the Billing? Is it the AR? Or is there the need for an independent IT system, exlusively oriented towards the customer details management? What about the so-called Customer Hub?
Imagine the case where a billing system must execute a billing cycle and produce invoices that will be sent to the customers. There is definately the need for a customer base to lie within the billing system.
For large Telcos with diversity in their activities there are customers that do not fall into the traditional telco customer category. For example, there are customers that may proceed with an one-off transaction with the Telco and for that transaction they should get an one-off invoice typically generated by an AR system.
Consider a consumer belonging to some other licenced operator (OLO) taking advantage of a merchandise offer that your telco launches (e.g. a cellphone or a fixed-line phone or even a modem/router). This is an one-off transaction that doesn't constitute a relationship. Therefore, a typical CRM should not be aware of this potential customer, not until it becomes one. But again, in order to build a relationship you most probably need an IT system to manage leads and opportunities, so bottomline you will need to keep the customer details in order to incorporate them into a lead & opportunities list. This is clearly a CRM task. And as such, it definately makes one think that CRM should be the customer master.
Now, consider for a moment that you are a financial telco guy. You don't give a penny for sales leads, offers and other commercial jargon. The only thing you want to know is the account balance of the customer, his debt, his credit worthiness. You most probably think that the world would be a better place to be, if there was a Financial hub that would maintain all customer financial transactions. And again, such a hub will have to somehow host and manage the customer entity.
Now, imagine that your telcos data are old; very old. They are initially born at those ancient times, where IT systems & business processes where subscription-oriented and the concept of customer was totally unknown; multiple unconsolidated customer instances spanning across multiple IT silos; poor data quality; insufficient customer feedback; synchronization problems; business analgesia; In this nightmarish case, you most likely need a customer hub that will consolidate all those sparse customer instances & keep this consolidation alive when a new customer instance is entered by the user, clean the customer data & keep them clean, apply rule-based modifications and propagate the changes towards the necessary IT systems according to pre-defined, business-originated criteria.
To conclude, traditionally, CRM is considered to be the customer master; and frankly it must be, this way or another. But legacy systems & processes impose the need for a customer hub. Such a hub, architecture-wise, is part of the CRM system. Or at least it should be.

Billing In Focus: Should Receivables Management be part of a Convergent Billing Solution?

Once upon a time, I took part in a very interesting conversation about next generation trends regarding billing and ERP solutions. During this discussion, the billing expert interlocutor claimed that both prepaid to postpaid and fixed to mobile convergence are and will continue to be the major issue for the near future. He also foresaw the expansion of IT in order to incorporate the capabilities of the Intelligent Network, as well as the opportunities that will arise for the Telecommunication industry from the micropayments and the cloud services.
On the other hand, the ERP expert alleged that the major issue for the years to come will be the extended implementation of the RFID technology in the Supply Chain ecosystem, and the consolidation of all ERP platforms accross the multiple business entities of the large european groups of telecommunication companies.
Well, although I found all these hot topics very interesting at the moment, I had the idea of asking a really common question: What would actually be the future for the Accounts Receivable area? What would they really think about the future trends of the Collection management, Bad Debt administration, Price Plans capabilities, Overdue Interest Management, Credit Scoring and so forth.
I was suprised when the billing expert said that the AR capabilities were not actually part of a convergent billing solution, whereas the ERP expert insisted that for the telecommunication industry AR is commonly part of the billing solution.
It seems that AR is a grey zone, although receivables are one of key elements of revenues, and IT systems capabilities are supposed to enhance revenue management and bottomline EBITDA.
To me, Convergent Billing Solutions offer  Revenue Management capabilities which go beyond the traditional billing field.
Furthemore, Revenue Management makes use of rich, detailed billing data to support Revenue and Credit management business processes.
Also, increased Customer insight can be leveraged to personalize Credit/Revenue Management processes.
Nevetheless, for large Telcommunication Operators with diversity in their activities (such as incumbent operators), a seperate distinct AR outside the billing could be the financial hub, as there are customers that do not fall into the traditional telecommunication customer category.
Moreover, Convergent Billing additional AR modules often need serious customization in order to meet Telcos specific needs.
And just to be on the right side: according to some IT strategies, Best-of-Breed & Best-in-Class applications are not always part of a Convergent Billing Solution.

Intelligent Network Services

The purpose and the philosophy of an Intelligent Network System (IN) is to add more intelligence and control over the telecommunications network in a centralized manner. In other words, IN is the central system that:

• accommodates the logic of the various IN services being provided through the network
• controls the provision of those services

Consequently, IN offers centralized intelligent telecommunications services minimizing at the same time the cost of ownership, implementation and changes of those services.

Some of the main IN services are listed below:

• Freephone
  Through the use of this service, a fixed-line user can call a non-geographic number (typically 800xxx) without being charged. He or she can call this number from anywhere within his/her country limits for free, whilst the actual cost of the call is charged to the number owner (i.e. a company).
• Onephone
  Through the use of this service, a fixed-line user can call a non-geographic number (typically 801xxx), that belongs to a company. The user is always charged with the cost of a local call, whereas the number owner is charged with the difference of the cost between the long-distance and the local call, if applicable.
• Premium Rate
  By calling a non-geographic number (typically 901xxx, 909xxx), a fixed-line user obtains access to content-based or other premium rate services.
• Televoting
  A fixed-line user calls a non-geographic number in order to participate in a voting process.
• Short Digit Menus
  The user calls a non-geographic number (typically 1xxx) and follows IVR instructions in order to get help or information (something like the white pages, or the trouble ticketing service)
• Prepaid Card
  The user uses a prepaid card to make a call from a fixed or mobile device.
• Virtual Card
  The fixed-line user through the use of his account credentials can make a phone call from practically any fixed-line device and receive his charge in his postpaid bill.

Data Retention for Telecoms: European Directive 2006/24

Data retention is not something new for the telecommunications industry. It is an issue that has been closely looked into by the telecommunication companies, as well as the Regulatory Authorities of the member states.

Data retention is being in detail described by the European Directive 2006/24. Data retention ED requires:

• specific traffic data to be retained so that these can be made available to competent authorities for the "detection, investigation and prosecution of serious crime",
• the retention of large quantities of personal data for periods longer than needed for commercial purposes. These data are capable of revealing significant information about a person's private life. Accordingly considerable harm could be done to personal integrity if these data were to leak to or be accessed by unauthorised persons.

At this point, let us focus upon the European Directive 2006/24 providing further details. According to Article 3 of the European Directive, the Telecommunications Operators are obliged to retain both successful & unsuccessful calls. Also, Article 3 explicitly states that there is no obligation for the retention of the Unconnected calls. According to the ED an unsuccessful call is a successfully connected call in terms of network connection but the called number does not answer back. An unconnected call is a call where no network connection has been able to be established, whatsoever.

Article 4 defines the quality of the data that an Operator must retain. Namely, an Operator must retain the Calling telephone number, the Name and the Address of the Subscriber, the Telephone Number(s) Called, the Telephone Number(s) to which the call is routed (to cover cases like call diversion, one-phone and free-phone services), the Name and Address of the Called Subscriber, the Date and Time of the Start and End of the Call and the Telephone Service Used.

Finally, Article 6 tries to define in a most flexible way the period for which the Operations need to retain the previously mentioned information. Article 6, therefore, states that the retention period should be no less than 6 months and no more than two years.

Prepaid 2 Postpaid Convergence

Pre2Postpaid Convergence as a concept can be seen both as business and as systems convergence.

In terms of business, community and/or friends & family price plans may involve both prepaid and postpaid subscriptions under the same billing entity (i.e. account), incorporating:

• Postpaid top-ups to the prepaid subscriptions (periodic and ad hoc),
• Postpaid-driven policy management aspects (e.g. parental control) upon the prepaid subscription (e.g. silent time), 
• Postpaid-driven alarm notification for the bill shock prevention,  
• Cross payment method discounting schemes (e.g. for each X Euros spent by the prepaid subscription, a Y-Euro discount is given to the postpaid subscription),
• Ability to migrate the prepaid subscription to postpaid, retaining at the same time the available credits as well as the event-source (MSISDN or telephone number).

As far as systems convergence is concerned, typically until now, postpaid billing is an IT-driven activity through the use of an IT Billing System, whereas prepaid billing is a Technology-driven activity through the use of the Intelligent Network.

The new business scenarios (such as the aforementioned one) clearly impose a Pre2Post convergence that should be implemented and supported by one single system (one rating & billing engine), offering both off-line and on-line capabilities.

Off-line capabilities are obviously needed for the postpaid billing, whilst the on-line capabilities are essential for the prepaid billing but also for some aspects of the postpaid one, such as policy management and alarm notification.

Open Item or Balance Forward?

Open Item Accounting Method constitutes a common practice for the billing of Corporate Companies and Other Licensed Operators (OLOs) Accounts, primarily because it offers great flexibility in payments allocation and matching as well as in processing of invoices disputed amounts.

To elaborate further on this, according to the Open Item Accounting Method, each generated invoice constitutes an open item against which a payment is allocated. Moreover, the outstanding balance consisted of the previous invoices is not embedded in the next invoice.

On the other hand, according to the Balance Forward Accounting method implemented mainly for Residential, Professionals, SOHO etc, each generated invoice consists of prioritized subtotals (e.g. interest-bearing amounts, non-interest-bearing amounts, etc). These prioritized subtotals, stemming from all generated invoices, form the account balance. A payment in this case is not allocated towards a specific open item (i.e. invoice), but towards the whole account outstanding balance covering the subtotals of the highest priority and in case of the same priority the oldest ones (FIFO). Also, the outstanding balance consisted from the previous invoices is actually embedded in the next invoice.

Apparently, the aforementioned Balance Forward Accounting practice is much more complicated and more difficult to follow when, for example, processing invoice disputed amounts that must not get covered whatsoever, since a payment may very well cover disputed amounts of older invoices.

Net Neutrality & Wikileaks

The great WikiLeaks scandal has less to do with the publication of state secrets from US Embassies around the world and their threat to national security and more with how the secrets got out in the first place.

Undoubtly, it's embarrassing to read on the Internet what senior state leaders think about each other, but the fact the information got out in the first place is of much greater concern.

For the telecommunications industry, and Net Neutrality Principle in particular, the fragile arguments in its favor have totally collapsed in a matter of days. Yes, many countries already practise some form of net censorship; but having US authorities force the closure of WikiLeaks’ Amazon hosted sites and (presumably) launching countless DoS (denial of service) attacks against WikiLeaks, makes the Net Neutrality argument at least farcical.


How hypocritical will it now be for regulators (such as FCC) to foist for Net Neutrality on the telecommunication industry when governments have resorted to extreme measures in the case of WikiLeaks?


Indisputably, it is the very independence of the internet that is now most under threat.

About Net Neutrality Principle

Net Neutrality: What exactly is it?
The Net Neutrality Principle is based on the idea of the smooth and unfailing access of each and every individual to any information across the internet without any access discrimination by the ISPs, such as:

1. Access discrimination from specific devices, i.e. applying downloading cap for data streaming being carried out using smartphones
2. Access discrimination based upon the content of the accessed information, i.e. throttling VoIP traffic to suppress rival on-line phone services
3. Access discrimination due to price differentiation, i.e. charging differently for peer-to-peer file sharing
4. Access discrimination due to rate differentiation, i.e. applying a downloading cap for data-intensives services

In Europe, the discussions over the Net Neutrality Principle are at a very early stage. In USA, on the other hand, the issue in question lies in the center of the interest for internet users, ISPs, the Regulatory authorities, as well as the political parties (Democratics vs Republicans).