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Feature Article
January 2003

Mobile Service providers & WiFi -- Who Does The Billing?


Recently, Wireless Fidelity (WiFi) has become a hot topic among Mobile Service Providers (SPs). WiFi is both a competing and complementary technology to 2.5G/3G networks. Compared to 3G networks, WiFi technology is relatively cheap, offers fast connectivity, and works today. As WiFi grows in popularity, mobile SPs are evaluating its potential fit within their network strategy in conjunction with the continuing move toward a 2.5G/3G environment.

A key challenge for mobile SPs offering WiFi services is their ability to bill for this usage together with usage over their 2G/2.5G/3G networks. In addition to providing consolidated billing for subscribers, challenges remain including information and revenue settlement with WiFi partners (many mobile SPs are looking at partnering with WiFi network and service providers). Providing consolidated billing, revenue, and information settlement can be a key inhibitor to a hybrid WiFi and 2G/2.5G/3G network strategy.

Why is WiFi Important to Mobile SPs?

By integrating WiFi and 2.5G/3G technologies, mobile SPs are able to provide their customers with broadband data access today. Mobile data access is typically required in two scenarios:

  • A person who is traveling at a high speed (e.g., in a car or train); or
  • A person who is relatively stationary, but does not have access to a wired network (e.g., in an airport lounge or cafe).

The rollout of 2.5G/3G networks allows mobile SPs to provide data access in both scenarios; however, WiFi typically offers advantages (available today, speed, price) for mobile data access when a person is relatively stationary and in a high-density area.

The combination of WiFi and 2.5G/3G technologies enables mobile SPs to offer their subscribers cost effective bandwidth (via WiFi) for relatively stationary data access and broad coverage (via 2.5G/3G) for mobile data access. It is clear that the combination of WiFi and 2.5G/3G networks makes a compelling offering for the market. Bundling of WiFi and 2.5G/3G is likely to be a key differentiator for leading mobile SPs.

Recognizing the need for superior customer relationships in the move to up-sell existing subscribers and secure new ones, mobile SPs are hoping to leverage their existing Operational Support Systems (OSS) and Business Support Systems (BSS) for the deployment of an integrated WiFi/2.5G/3G network. The alternative is not �owning� the customer with respect to WiFi access, thus potentially diluting customer relationships for mobile data services and increasing risk of churn.

Who Does the Billing?

Within the WiFi ecosystem, there are several business models that dictate what party maintains the customer and billing relationship. WiFi business models typically involve partnering and as a result require information and revenue settlement. Four common WiFi business models include:

  • Micro-Carriers;
  • Aggregators;
  • MVNO; and
  • Mobile Service Providers (SPs).
WiFi Micro-Carriers set up their own access points and maintain the customer and billing relationship with subscribers. Starbucks is an example of a WiFi micro-carrier � many of the Starbucks coffee houses across North America are outfitted with WiFi access points, allowing patrons to wirelessly surf the Web while sipping their favorite Starbucks blend.

WiFi Aggregators establish relationships with several micro-carriers and create a far-reaching network woven together providing seamless access across all the micro-carriers� networks while maintaining the customer and billing relationship with subscribers.

Mobile Virtual Network Operator (MVNO). It is likely virtual WiFi providers will emerge utilizing a well-known brand (e.g., an airline) while maintaining the customer and billing relationship with subscribers.

Mobile SPs can roll out their own WiFi network and/or partnering with micro-carriers/aggregators while maintaining the customer and billing relationship with subscribers.

Mobile service providers are in a unique position considering they are typically the only �player� in the WiFi environment that has the required OSS and BSS infrastructure required to support the customer and billing relationships that are central to these business models. As such, mobile SPs have a competitive advantage with respect to obtaining and maintaining customer ownership for WiFi services.

OSS/BSS Requirements

OSS applications and processes enable mobile SPs to manage their networks (e.g., provisioning, resource management, etc.). BSS applications and processes enable mobile SPs to manage their relationships with customers and partners (e.g., customer care, billing, partner management, etc). The OSS/BSS requirements for a mobile SP to support the customer and billing relationships in a WiFi environment fall into four categories: CRM, Ordering and Fulfillment, Partner Management, and Billing.

Communications specific CRM applications and processes must support the sales and marketing, analytic, and service and support functions necessary to sell to and service subscribers for WiFi services. Communications specific Ordering and Fulfillment applications and processes must support the product management, order management, and provisioning functions necessary to create and manage WiFi services. Communications specific Partner Management applications and processes must support the business model management, and the carrier (e.g., WiFi micro-carriers) partner management necessary to support WiFi partnerships, including information and revenue settlements. Communications specific Billing applications and processes must support the mediation, rating, billing, and assurance functions necessary to bill and collect revenues for WiFi services.

These four categories of OSS/BSS applications and processes will require the scalability and performance necessary to support not only services over 2G/2.5G/3G networks, but also the incremental subscribers and usage associated with services offered over WiFi networks. In addition to communications specific functionality, scalability, and performance, support for the MVNO model will provide Mobile SPs with the opportunity to reach new markets via brand channels. MVNO functionality requires support for distinct branding within CRM, Ordering and Fulfillment, Partner Management, and Billing applications.

Darren McKinney is director of product marketing at Amdocs. Amdocs provides information solutions to the leaders of the communications and IP industry worldwide, offering CRM, billing and order management systems for communications providers, and business support systems for directory publishing companies. For more information please visit www.amdocs.com.

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