This article originally appeared in the July 2011 issue of NGN.

It’s just shy of a year since AT&T (News - Alert) gave up on the flat-rate, unlimited plan and industry observers marked the end to the mobile broadband buffet. In March of this year, Ralph de la Vega, president and CEO of AT&T Mobility and Consumer Markets, remarked how over the past four years the company’s data traffic increased by 8000 percent.

Mobile networks are under siege, and demand is outstripping revenue growth sevenfold. Operators have been using policy control technology to make sure the vast majority of customers receive their fair share of bandwidth. But bandwidth management and all-you-can-eat plans can go only so far toward delivering superior mobile customer experiences. The new yardstick for competition is metered rates and paying for value. For operators to find new ways to monetize their networks, it is now time to shift out of the policy management comfort zone of bandwidth management, tiers and capping to deliver real differentiation based on policy-enabled apps and services powered by next-gen policy management. 

Policy management vendor selection has never been as critical a decision as it is today. By maintaining a traditional policy and PCRF approach operator policy infrastructure is at risk of being overwhelmed by the sheer volume of transactions and sabotaged by the long lead times required to develop and deliver competitive, new services. Policy 2.0 technology must address today’s most critical operator challenges and build a future-proof platform for tomorrow’s dynamic and expansive networks.

Operators are demanding agility, massive scalability and cost certainty as they look to solve their capacity crunch, deliver new subscriber services, and increase ARPU simultaneously. Policy management platforms that can provide these capabilities will greatly enhance the ability of an operator to make the necessary shift and succeed. Let’s take a look at each of these capabilities to understand why they matter – especially at this turning point in the industry.

Agility

There is much to be learned from operators in hyper-competitive markets, where new service deployment is already a critical factor in competing successfully. These innovative providers are offering services that are highly tailored to their markets – such as a Saudi Arabian service that blocks intrusive communications that occur during daily Muslim prayer times. 

And when it comes to agility, it’s no longer acceptable or feasible for operators to rely on scarce policy vendor developer resources for new features and policy-driven services. This Policy 1.0 model does not scale and interjects lead times that severely limit first-to-market upside opportunities. When selecting a policy management platform to handle today’s and tomorrow’s challenges, operators need to make sure that they can develop their own services – so that when marketing looks to deploy policies that will give them a competitive edge, they can build these services with resources and timeframes that they control in a matter of days rather than months.  

In short, agility means leveraging a policy platform that can deliver rich apps and services without requiring changes to the core code. New services typically require months of development time and very large budgets, so operators are under tremendous pressure to make sure that they are right about the new services and campaigns they recommend. With an agile next-gen policy platform, addressable services can be added or removed according to market changes in hours or days – not weeks or months – removing the roadblocks associated with rolling out new services and responding to subscriber demand.

Scalability and Performance

The business model for mobile broadband is also one of increasing profitability and competitive differentiation through superior quality of service. To achieve this new business model, network operators are looking to more advanced, next-generation policy management platforms that help combat the exponential traffic growth, and reduce costs and improve the overall subscriber experience. 3G network operators and those moving to 4G need to ensure that their policy platforms have the kind of scalability and flexibility to handle far more policies, making it easier to deliver complex and highly differentiated, personalized services that are well integrated with real-time charging and subscriber profile intelligence systems.

Policy performance is already being strained, and this is before the rapid proliferation of over-the-top voice and video services that are poised to occur over mobile networks within the next one to three years. With an advanced, virtualized policy management platform, such a highly demanding transaction environment can be realized by distributing and load balancing across any number of servers, substantially reducing hardware costs and allowing scale to be readily added as required. A virtualized policy environment provides a foundation for the new era of policy by providing performance and scale that dwarfs standard policy architectures, allowing services to be delivered in a much more distributed and seamless fashion than by traditional, server-bound architectures, and by driving efficiencies that radically reduce total cost of ownership.  

Equally important as transactional performance and scale is the ability to make the transition from bandwidth management only policies to a richer set of service-enabling policies. Because richer services require multiple policies to be applied in unison, it is important to know that your policy solution can efficiently process many more rules even while managing far more active subscriber sessions.

Cost Certainty

Capital and operational efficiency will continue to be key goals for service providers. So, even as new, personalized services contribute more to operator topline growth, operators will need to continue to drive down their costs. By using open and rapid development methods and by delivering the high performance associated with massive data center virtualization, Policy 2.0 technologies are designed to provide high value at a fraction of the cost associated with service creation of the past. Service development and buildouts will become more predictable as operator IT groups capitalize on policy-driven service creation and fully leverage massively scalable policy.

The role of policy is changing from primarily a defensive reaction to difficult-to-manage broadband data growth and congestion, and becoming one of the core platforms for innovation in telecom services. Next-generation, Policy 2.0 platforms will need to be deployed not only to control cost per subscriber, but also to increase ARPU and increase loyalty, enabling network operators to assume a more central role in the broadband service value chain.

Bill Diotte is CEO of BroadHop (News - Alert) Inc. (www.broadhop.com).