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Mobile Billing Systems Cause Revenue Losses in 2011, Automated Systems Needed

March 28, 2012

By Monica Gleberman, Contributing Writer

The mobile telecom industry not only took a big hit to its revenue last year of more than $58 billion, but the industry will continue to see losses in revenue through 2016 if they do not adapt better solutions for their billing needs.

In 2010, there were estimated to be around five billion mobile cellular subscriptions worldwide. If the industry continues to see growth, then why are the revenues continuing to decrease?

According to a recent report by Juniper Research (News - Alert) called, ‘Mobile Revenue Assurance & Fraud Management: Business Strategies & Forecasts 2012-2016,” the industry has seen inadequate fraud management (FM) and revenue assurance (RA) procedures in place. This, the research firm said, is because “operators have been obliged to integrate an ever-expanding array of devices and to simultaneously manage a surge in cellular network traffic” causing billing systems to fail to keep pace.

For operators this failure has resulted in billions of dollars in lost revenue and has created a major problem in the industry.

Windsor Holden, co-Author of the report advised, “As the industry moves more aggressively into a 4G/LTE (News - Alert) environment, telcos risk undermining any revenue actually earned from value-added services by continuing to not invest in appropriate business support systems. Despite their initial costs, RA and FM systems demonstrate a strong case for return on investment.”

As a solution, Juniper’s study suggested implementing new systems that could help manage revenue by adding operators that can minimize the outflows.

With sustained investment, the report finds that leakage has the potential to decline to 4 percent of revenue in 2016, representing a net reduction of nearly $15 billion - verses a loss of five times that by 2016, the report notes.

Edited by Stefania Viscusi

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