When you walk into your friendly local supermarket and pick up your trolley (your cart, if you prefere), you're not greeted, before you've picked the first packet of tomatoes or bottle of olive oil, by someone asking you how you intend to pay.
|Arman Hazairin: new|
developments have always
tended to be in the
If you were, it would be odd to think that, depending on your answer — credit card, debit card or cash — you would be directed to different sections of the store with different ranges of products.
And you wouldn't be asked in advance how much, precisely, you intended to spend, and then directed to the check-out as soon as you reached that limit. That's a matter for you and your wallet or your credit-card company.
Yet that's how it is in the telecoms industry, with post-paid and pre-paid accounts. If you're one of the elite, who elect to pay for what you've used at the end of each month, then pretty much all services are offered to you. But if you're one of the majority who pays in advance, for all your efforts to find that late-night convenience store so you can top up your credit, you usually get a poorer selection of services.
Pre-pay and post-pay are, for almost every operator, two different worlds. Telkomsel, the biggest operator in Indonesia, is one of the first to try to bring these together.
The reason, says IT vice president Arman Hazairin, is that until now "new developments always tended to be in the post-paid side".
Growth in pre-paid
But that doesn't fit Telkomsel's market — where 95% of customers and probably 80% of revenues are pre-pay. "In our market the growth is in the pre-paid side," says Hazairin. "It's a limiting infrastructure."
He's been seeking flexibility and — after a three-year project — has now launched a converged system for billing and IN that allows him to offer the same services to both sorts of customers.
The service is in operation, but the final integration is due to take place later in 2006, he told Global Telecoms Business. "We now have a single infrastructure for charging," he says. "You start a new paradigm in post-paid and pre-paid use."
In fact, products are now developed without having to think in advance whether they should be for pre-pay or post-pay, he says.
"You create the product offerings and make post-pay and pre-pay only a matter of a choice of payment. You decide which one can be charged online, which one can be charged offline. Then it's a new set of the game. It's now longer post-paid/pre-paid. It can be both or either one."
That means, he continues, that Telkomsel "combine the best of both worlds". The company can get the flexibility of post-paid systems and the realtime capability of pre-paid systems, using the billing and IN system.
Telkomsel has been working with Siemens and Convergys on this project. "We use Siemens IN and we use Geneva for billing. We put the Convergys rater into the Siemens IN," says Hazairin.
Telkomsel has 25 million customers and a 54% market share in Indonesia, a country of 250 million. It is using the convergent charging solution to support its geographically complex business that spans over 13,000 islands. The solution satisfied Telkomsel's engineering requirements for a network that is available to 90% of the country's population.
Convergent billing is now the rule at Telkomsel, says Hazairin. "When I got into this project I realised it was easier to think that way than to think about post-pay and pre-pay, because when you are still thinking in that way, you still have post-pay and pre-pay silos, and you don't get all of the potential possible. The first thing I do is to tell the people that you can do online charging via post-paid payment. Or the other way round, or mixed. As long as you control your credit, your revenue streams are OK."
Now, you develop the product, and then "it's a choice of payment only". But it's a choice that the customer can make at any time. "You can mix — and you can please yourself. One customer at one time can be post-pay, and at another time can be pre-pay. At any time," he says.
This even applies to individual services during the lifecycle of a service, he adds. "Say they are committed to a minimum payment, and they are contracted to you a certain spending limit. When you reach that then you can continue as a pre-pay. Is that post-pay or pre-pay? It's both."
Telkomsel has been running post-paid cellular services for 11 years in Indonesia, operating on 900 and 1800 megahertz. In November 1997 it became the first cellular operator in Asia to introduce rechargeable GSM pre-paid services, using Siemens as the supplier. It also offers GPRS, wifi and EDGE technology and is running a 3G trial.
The converged billing project has been running for 24 months and the approach was originally sketched out at a meeting between the companies at Convergys's international headquarters near Cambridge in the UK — where the Geneva package was originally developed.
It is the first collaboration by Siemens and Convergys on such a project, which has been managed by the communications line of business at Siemens, with designers and developers from all companies working together. Meanwhile the two suppliers have been working to make a production version of the project, according to Giles Newcombe, senior director of advanced development at the billing company.
The charging platform "is independent of the service", says Hazairin. "The way we do the architecture is that you have standard interface to the network, so the event generated by the network can be charged. You also have a flexible IP interface which later on you can map to the different services you have created. It's billing without precedent, charging without precedent."
This is the enabling infrastructure, he explains. "You put it in and it's up to you how you want to use it. The next job for the operator is a matter of integration of the service. Now you have single control of the system. You have unified customer data."
There are advantages in terms of revenue assurance, as well, because of the transparency of the information.
"It's in live operation now," says Hazairin. "We have been doing it as a three-year project and we're now at the final phase. Now it is loosely integrated between the billing and the IN but already there is a single system of charging."
In the final phase of the project, which takes place this year, the systems "will be tightly integrated", he says, "so you can have almost real-time synchronisation between those systems. IT will reduce the amount of control needed because it is embedded in the systems already."
And the single view of the customer — which is available with the loosely integrated version — will become even more useful. "Loosely we have that already," says Hazairin.
"The only difference — which is the ultimate benefit of this — is that in the last phase it will be integrated as part of the product. Loose meaning we have to do our own integration. In the last phase, as part of the product, it will be a tightly integrated system."
Newcombe adds: "It's the first solution of this type. No one's doing it to the scale that Telkomsel is doing it. We're talking of a large tier-one operator here."
And it's already paid for itself, before the project is completed, says Hazairin. "Just by doing the latest phase — by fixing the revenue stream, the revenue accounting control, by putting in the single control — the project paid for itself," he says. "My investment has already paid off. I'm just profiting now from the investment I made."
And how much was the investment? How much will it be? "I can't disclose that part," he smiles.
"The nature of the market is that the highest growth is in the pre-paid side. Nobody cared about the leakage on that," he says. Now that Telkomsel has an integrated system and a single view of customers it can "fix the stream of revenue and then you gain".
Meanwhile Telkomsel has a 3G licence. "We're getting ready for the roll-out. It will be this year."
With that, Hazairin and his colleagues will be looking at IMS and how to integrate it into the new charging platform as well. "That's the next step we see. But if you get the back-end right these things are easier to integrate," he adds. GTB
| Arman Hazairin
- Vice president of IT and value-added services at Telkomsel
- Graduate in electrical engineering from the Institute of Technology Bundung
- Graduated "through the ranks" at Telkomsel; instrumental in the migration of a legacy billing system to the new, current billing and customer care system
- Also responsible for value added services, including SMS, MMS, WAP, GPRS and voicemail