Facts

Communications networks and information systems are not the flawless machines most people think they are. Over the last 10 years, billing complexity, reduced time-to-market and overall system complexity have led to an increase in the risk of technical glitches and loss of revenue.

Figures

On average, if a sample of transactions (voice, SMS, MMS, WAP, ring tone download, etc) is generated for a Western Europe mobile operator postpaid subscription, it can be expected that between 0.5% and 6% of the transactions will be billed incorrectly as a result of poor metering, bad pricing, lost records, the duplication of records, incorrect labelling, etc. This figure is known as the Item Error Rate.

For Prepaid customers the Item Error Rate is usually in the range of 0.3%-3%, since the charging scheme is simpler than for Postpaid customers.

For Mobile Virtual Network Operators or recently created GSM Operators, the Item Error Rate can account for as much as 10% of incorrectly billed transactions because operations are less mature.

For Content Providers the Item Error Rate is usually in the range of 3%-10%.

For roaming services the error rate is usually slightly higher than for on-net calls since the billing of these services covers three layers of players: Roaming Partner Operators, the Data Clearing House and Subscriber Operator.

Another problem undermining the revenues of mobile operators is the bypass phenomenon. Bypass traffic may represent more than 20% of the total fixed-to-mobile traffic in several Latin American and Eastern Europe countries. Depending on the various regulations and competitive pressure (i.e. the difference in prices between fixed-to-mobile and mobile-to-mobile traffic) the bypass percentage ratio can vary from one country to another. This is a genuine problem in Latin America, Europe and the Middle East but is more limited in the US market.

In Africa, several countries have introduced different terminating fixed-to-mobile rates for traffic originating within the country and traffic originating abroad. This has led to the possibility of arbitrage in which some companies deliberately present traffic on incorrect trunks in order to take advantage of the best rates that on occasion may result in discounts of more than 30%.

Another problem facing carriers is the poor quality of content services. In our experience of monitoring content services in Asian countries where the content market is the most advanced, the quality error rate can exceed 20% for premium SMS, ring tone downloads and music download services.

There are more than 600 GSM operators around the world, with new licences constantly being issued and increasingly complex roaming agreements implemented in peer-to-peer agreements or through roaming hubs. This means that IR.21 configurations, such as SMS Centre codes or number ranges, are very often incorrectly configured in some networks, leading to customers being deprived of services.

Competing/Partnering GSM operators implement complex mechanisms to steer roaming revenues to their preferred partner of the moment. With mechanisms for steering roaming and anti-steering mechanisms being implemented in parallel and competitively by a number of parties, it is extremely difficult for GSM operators to assess the genuine statistical success of steering mechanisms.

Detecting & Fixing

All the above problems have far-reaching implications for the revenues and profitability of communications companies.

In the past, the methods of dealing with the loss of revenue and technical glitches like these were based on the introduction of quality systems, intense system testing and ... waiting for customer complaints to Call Centres!

At Araxxe, we believe that, through regular automated monitoring, these problems may be detected in advance and fixed before they affect your revenues adversely, cause customer dissatisfaction or undermine your profitability.

If you want to protect your revenue streams proactively, take a look at our portfolio of monitoring services.