This article originally appeared in the April 2012 issue of INTERNET TELEPHONY magazine.
As the telecom industry rapidly evolves and an exponential increase in customer usage data burdens networks, policy management strategies are taking center stage. The enhanced communications marketplace, with a focus on customer experience, is bringing a renewed interest in delivering services differently. To revamp policy control strategies and manage today’s evolving communications marketplace, operators will face a familiar question: How do we balance revenue, customer satisfaction and resources?
A few years ago, operators entered the first phase of policy control, which focused on controlling the network and capping data use. Operators saw traffic volumes diverging dramatically from anticipated revenues and thought the best solution was to deter the use of data services. As traffic moved away from peer-to-peer dominance and towards a more mass-market pattern of use dominated by Internet, and particularly video, access, operators changed policy control tactics and entered a new phase that encourages data use and moves towards smarter prioritization. It involves striking a balance between promoting the use of data where resources are plentiful and operating prioritization when resources are scarce to ensure the maximum payback on network investments.
A pioneer in smart bandwidth prioritization is Finnish operator DNA Ltd., which uses policy control to offer differentiated broadband services and control traffic congestion. When a DNA subscriber exceeds their data cap, for example, they still get maximum bandwidth unless the network is extremely congested and more bandwidth is needed for other customers.
Results show a more optimized use of the network capacity and increased revenue by enabling customers with choice as to the level of bandwidth and usage volume needed. This business model of smarter prioritization is now combining with an intense level of customer focus to drive the next phase in policy control.
The future of policy control is centered on content prioritization tailored to customer needs. Content prioritization is one aspect of customer experience management – the industry’s current hot topic. CSPs understand that their policy control strategies must ensure an engaging customer experience. Instead of waiting for customer service calls, operators are proactively reacting to customer needs. This means monitoring the user experience and analyzing the details of customers’ behaviors, so operators can react in real time to subscribers’ requests. With real-time monitoring, operators can, for example, collect data from a subscriber who may be experiencing poor service, process it immediately, and proactively put out the proper discount or promotion before that subscriber reacts and calls customer service. Monitoring customer behavior also allows operators to personalize packages and improve their ability to charge customers for service features.
A practical example of differentiated policy is the low quality default audio and video settings that Netflix implements for its customers in locations in which Internet service providers impose data caps. The low quality allows subscribers to watch hours of content without worrying about going over the caps. Customers can change the default setting back to a higher quality in their account settings page. However, operators could also come to an agreement with suppliers of online video services to offer packages where the video usage is excluded from the cap or bandwidth is prioritized for video – a very practical illustration of policy management.
In order to successfully implement the new phase of policy control, operators will encounter challenges without the right solution. Real-time monitoring requires scalable systems that can automatically process a tremendous amount of data. OSS/BSS software needs to be dynamic and flexible to enable innovation in changing business environments, while offering support for multiple vendors, technologies and operating models. Prioritizing services means charging solutions need to manage market segmentation, revenue sharing and customer retention/promotions. With the right tools, operators can enter phase three of policy control, offering advanced and highly competitive broadband services while
Juhani Hintikka is president and CEO of Comptel Corp.
Edited by Jennifer Russell