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2 Contents Articles Telecom Expense Management (TEM) 1 Audit (telecommunication) 2 Automatic Message Accounting 4 Average call duration 6 Average margin per user 6 Average revenue per user 6 Bit Stream Access 7 Bypass (telecommunications) 8 Call accounting 8 Call detail record 12 Call volume (telecommunications) 14 CardEx 15 Carrier Pre-Selection 15 Customer proprietary network information 16 Effects of communication technology on local communities 17 Fonview 19 Individual communication services and tariffs 19 Least-cost routing 20 Lec billing 24 Harvey J. Levin 25 Local-loop unbundling 35 LRIC 40 Mobinomics 41 Packet Clearing House 42 Postal, telegraph and telephone service 43 Premium-rate telephone number 44 Prepaid mobile phone 52 Prepaid telephone calls 56 Quadruple play 57 Real Time Charging 57 Rechargeable calling card 59 Revenue assurance 60 Sub-loop unbundling 64 Telecommunications billing 64
3 Telecommunications mediation 66 Telecommunications rating 66 Telecommunications tariff 69 Telephone card 71 Telephone token 74 Test call generator 75 Traffic pumping 76 Unbundled access 80 Unbundled Network Element 81 Wireline incumbent 83 Expense 83 Accretion expense 85 Bad debt 86 Business overhead expense disability insurance 88 Expense account 89 Expense management 90 Expense Ratio 91 Expenses versus Capital Expenditures 92 Freight expense 94 Interest expense 94 Momentem 95 Non-Cash Expense 96 Operating expense 96 Payroll 97 Stock option expensing 100 Tax expense 102 Total Expense Ratio 103 References Article Sources and Contributors 104 Image Sources, Licenses and Contributors 107 Article Licenses License 108
4 Telecom Expense Management (TEM) 1 Telecom Expense Management (TEM) Telecom Expense Management (TEM) is a specialty financial discipline involving the application of systematic analysis to telecom service orders, inventory, bills regarding telecom services. Description TEM includes the following business processes: Sourcing - of telecommunications services. In competitive markets sourcing telecommunications services can often mean acquiring proposals from a number of potential suppliers, qualifying their recommendations and choosing the winning bid. Ordering, Provisioning and Support - telecommunications companies have extensive processes for ordering, initializing (aka provisioning) and assuring quality service operation through technical support services. Inventory Management - involves the identification and status tracking of each telecommunications service. Invoice Management - telecommunications service providers invoice their customers. For large enterprises this can mean tens of millions of dollars and hundreds or thousands of invoices each month. Processes to manage these commitments to pay and internally tracking these financial documents are important in avoiding expense of late payments or over-payments. Usage Management - some services are billed on some usage basis, so the enterprise needs to track usage to be sure that the usage to be paid for is a legitimate business service request and is appropriate accounted for and approved by users. Dispute Management - telecommunications service providers have extensive mechanisms for customers to dispute charges on their bill. This element of TEM programs require the management of these processes. Business Intelligence - tracking overall TEM program results and reporting dispute outcomes are important to senior financial executives who typically sponsor and implement TEM programs for their business organization.  References  Gartner Research Report #G (http:/ / www. gartner. com) - "Cost Cutting by Telecom Expense Management Services", April 2008
5 Audit (telecommunication) 2 Audit (telecommunication) In telecommunications, the term audit has the following meanings: Telecom Audit defines the act of conducting a review, examination and reconciliation of Telecom, Wireless and Network customer service records, invoicing and contract agreements in order to ensure the accuracy of budgetary forecasting. Independent review and examination of records and activities to assess the adequacy of system controls, to ensure compliance with established policies and operational procedures, and to recommend necessary changes in controls, policies, or procedures. Analysis of invoices, lines, rates, tariffs, taxes, plans, usage, call volume, systems, and contracts resulting in cost reduction, proper invoicing and optimization of telecommunication systems often conducted by an independent telecommunications consultant or firm. The simplest audits merely consist of comparing current telecommunications billing and usage to other alternatives based on their relative cost, security and reliability.  Complex audits utilize software applications, direct bargaining with service providers and activity reports that include detail down to an individual employee's usage.  Auditing Methods and Consultants In business, companies with significant telecommunications costs or a telecommunications focus normally either conduct audits internally or hire a consultant. No matter the method, typical audits encompass one or more of the following: Telecom Expense Management(TEM): An ongoing analysis and adjustment of internal telecommunications procedures and billing designed to maximize savings. Telecom RFP (Request For Proposals): A proposed management plan designed to maximize efficiency, security and reliability in the business' communications. Consultants typically present an RFP for approval by their clients. Management and Reporting: Ongoing telecommunications cost and activity analytics. Internal auditors and consultants both use software as part of the process: either a generalized database application or specialized applications designed for auditing.  A common misconception is that a Telecom Audit only relates to the area of telecom cost, when if fact it encompasses just about every communications service that a business expends its budget on. Audits may focus on mobile phones and devices, Internet service or land line telephony, or they may encompass all three.  Independent telecom auditing firms are not affiliated with telecom companies that sell mobile phones and devices, Internet service, long distance calling or land line telephony. They are independent and work on contingency.  Current Methods Internal Audit A business accounting department will generally only conduct a telecom bill review in the months that trigger a red flag due to the sudden spike in the expense of a communications service. This is usually contained to the one telecom service provider who triggered the red flag and the rest of the invoices are left unexamined because they fall within the considered norm of a small monthly cost increase. Contingency Fee Based Audit
6 Audit (telecommunication) 3 Business Process Outsourcing BPO, telecom consultant companies can provide a contingency fee based independent review and examination of records and activities to assess the compliance of telecom service providers with telecommunication contracts and State and Federal Tariffs. Critical Steps Establishing a "Book of Business" is the first step towards telecom auditing. The Book of Business can be an Excel spreadsheet compiled manually, that details every single line item charge associated with all corporate telecom, network and wireless payables, or it can be constructed by Electronic Data Interchange (EDI) feeds using TEM (Telecom Expense Management) software. Collect contractual agreements for each communication service that has a telecommunication agreement in place with your company. Copies of telecom service and equipment contracts can be requested from vendors if an Enterprise or Corporate HQ does not have a central library containing these legal documents. Obtain the State and Federal Tariffs filed by each phone service provider that pertains to each local, long distance and network circuit service that connects your business to the Local Exchange Carrier (LEC) in its geographic area. Reconcile the Book of Business, Telecom Contracts and the State and Federal Tariffs to identify any areas that can help lower a company's communications budget. References  Telecom Expense Management for Regular Folks Telecommunications Blog (http:// www. gill-technologies. com/ TelecommunicationsBlog/ telecom-expense-management-for-regular-folks/ )  Telecom Auditing FAQ (http:// www. telecomauditmanagement. com/ Phone_Bill_Audit_FAQ. html)  GILL Technologies Telecom Management Software (http:// www. gill-technologies. com/ Telecom_Management_Software. php)  Telecommunications Auditing (http:// www. auditelinc. com/ Telecommunications_Auditing. html)  Independent Auditing Firms (http:// www. espyservices. com) This article incorporates public domain material from websites or documents of the General Services Administration. National Information Systems Security Glossary External links Telecom Audit Education Blog (http:// blog. valicomcorp. com/ ) White Papers on Telecom Audit (http:// www. valicomcorp. com/ index. php/ White-Papers. html/ ) Sample Telecom Audit Reports (http:// profitlinktelecom. com/ ta-service-delivery. html) Telecom Audit ROI Calculator (http:// www. telapprise. com/ baseline_roi. html)
7 Automatic Message Accounting 4 Automatic Message Accounting Automatic Message Accounting (AMA) provides detail billing for telephone calls. When Direct Distance Dialing (DDD) was introduced in the USA, message registers no longer sufficed for dialed telephone calls. The need to record the time and phone number of each long distance call was met by electromechanical data processing equipment. Centralized AMA In Centralized AMA (CAMA) the originating Class 5 telephone switches used Automatic number identification (ANI) and Multi-frequency (MF) to send the originating and dialed phone numbers to the Class 4 Toll Connecting office. The Class 4 office had punched tape machines to record this information on a long strip of paper the width of a hand. Each day a technician cut the paper tapes and sent them to the Accounting Center to be read and processed into phone bills. Each punch recorder was responsible for 100 trunks, and its associated Call Identity Indexer (CII) identified the trunk for an Initial Entry upon connecting the call, an Answer Entry when the called party answered, and a Disconnect Entry when the call was cleared. AMA paper tape puncher, from a 20th century 5XB switch In Bell System exchanges (particularly 5XB switches) information from the Marker told the Sender that the call required ANI, and stored the calling equipment number in reed relay packs in the sender. The sender used the Transverter Connector (TVC) to seize a Transverter (TV), which was a bay of a few hundred flat spring relays that controlled all AMA functions. TV looked in the AMA Translator (AMAT) that took care of these particular few thousand lines. AMAT was a rack of ferrite ring cores with cross-connect wires passing through holes of 3 x 4 inches or about a decimeter square, one wire per line. The wire was terminated on a wire wrap peg representing that particular line, and passed through a ring that represented the NNX digits of the billing number, then the M, C, D and finally Units of that number. When queried, AMAT sent a high current pulse through the wire for that particular line, inducing pulses in the appropriate rings which were amplified by a cold cathode tube amplifier and then by a relay, and sent back to the Transverter which supplied it to the Sender for transmission by ANI to the Tandem office. In case of billing complaint, a test apparatus allowed scanning through all the lines in an office at the rate of about a hundred per minute, to find which ones were translated to a particular billing number. Local AMA In Local AMA (LAMA) all this equipment was located at the Class 5 office. In this case, it also recorded the completion of local calls, thus obviating message registers. For detail billed calls, the punch recorded both calling and called numbers, as well as time of day. For message rate calls, only the calling number and time of day. In some electromechanical offices in the 1970s, the paper tape punch recorders were replaced by magnetic tape recorders. Most punches remained in service until the exchange switch itself was replaced by more advanced systems. Stored Program Control exchanges, having computers anyway, do not need separate AMA equipment. They sent magnetic tapes to the Accounting Center until approximately 1990, when data links took over this job.
8 Automatic Message Accounting 5 Billing Automatic Message Format (BAF) Around the same time period, the Billing AMA Format (BAF) was developed to support the full range of local exchange carrier services. BAF is now the preferred format for all AMA data generated for processing by a LEC Revenue Accounting Office (RAO). BAF supports the complete spectrum of services and technologies, including local and network interconnection services, operator services, toll-free services, Intelligent Network database services, wireline and wireless call recording, IP addressing, and broadband data services. BAF is administered by Telcordia Technologies, with the Billing AMA Format Advisory Group (BAFAG) playing a central role in the overall approval and administration of BAF records. The BAFAG consists of subject matter experts and representatives from the Telcordia Consulting Services Business Group who review and authorize proposed BAF elements, as well as subject matter experts from AT&T, Qwest, and Verizon. The BAFAG uses GR-1100, Billing Automatic Message Accounting Format (BAF) , as the document that defines the BAF recordings generated for call scenarios. It describes the possible groupings of BAF structures and modules that form BAF records, the connection between service/technology and call type, how call type and call conditions determine what structure and modules (if any) are selected for generation of a BAF record, and how the characteristics of the calling/called addresses as well as the services provided are factors in module generation. Message Register Electromechanical pulse counters counted "Message Units" for Message Rate service lines, in Panel switches and similar exchanges installed in the early and middle 20th Century. The metering pulses were generated in a junctor circuit, at a rate set by the sender, usually one pulse every few minutes. Every month a worker wrote down the indicated number of message units, similar to a gas meter. In the middle 20th century it became customary to photograph the meters, about a hundred per film frame, for examination in comfort. Since they were only used on local calls, and most residential lines didn't pay for local calls, American message registers generally showed four digits. Despite the arrival of STD, Europe continued making and using message registers in the 1970s, designing ones that could register more than one click per second on a trunk call and display five or six digits. External links History of Bell System AMA  "Your Phone Dial Computes Your Bill", February 1949, Popular Science  References  / telecom-info. telcordia. com/ site-cgi/ ido/ docs. cgi?id=search& DOCUMENT=GR-1100&  / www. telephonetribute. com/ switches_survey_chapter_11. html  / books. google. com/ books?id=pcqdaaaambaj& pg=pa135& dq=popular+ science %22Some+ time+ ago%22& hl=en& ei=gzjhti-whzgunwed79t6dw& sa=x& oi=book_result& ct=result& resnum=1& ved=0ccoq6aewaa#v=onepage& q& f=true
9 Average call duration 6 Average call duration In telecommunications, Average Call Duration (ACD) is a measure based on a call record (or CDR) sample to determine traffic demand and forecast call volumes, serving also as a tool for infrastructure monitoring (such as switches and cables). Average margin per user Average margin per user (AMPU) is one of several criteria for measuring the success of telephone companies. It is an alternative to ARPU, which focuses on revenue per unit. The central premise is that by attention to the margin produced per sold unit, not the amount of cash (revenue) earned from each customer, one can afford low volumes and still have a healthy company. High volumes can also bring a significant edge, but only until competition forces prices down. Telecom analysts are traditionally  highly focused on ARPU because the typical telco has had huge infrastructure costs that needs to be serviced by a considerable ARPU. Another use of AMPU in some telephone companies (in particular Telenor) is Average Minutes Per User, meaning the amount of time (measured in minutes) the average subscriber talks (or listens) in their phones. This term is also called Minutes-Of-Use or MOU. References  "Forget the Renenues - Focus on Margins" (http:/ / www. mobilein. com/ Perspectives/ CBOSS_Margins-1. htm), MobileIN, April 4, 2005 Average revenue per user Average revenue per user (sometimes average revenue per unit) usually abbreviated to ARPU is a measure used primarily by consumer communications and networking companies, defined as the total revenue divided by the number of subscribers. This term is used by companies that offer subscription services to clients for example, telephone carriers, Internet service providers, and hosts. It is a measure of the revenue generated by one customer phone, pager, etc., per unit time, typically per year or month. In mobile telephony, ARPU includes not only the revenues billed to the customer each month for usage, but also the revenue generated from incoming calls, payable within the regulatory interconnection regime. This provides the company a granular view at a per user or unit basis and allows it to track revenue sources and growth. This is a very common hooker metric There is a trend by telecommunications and Internet companies and their suppliers to sell extra services to users and a lot of the promotion that is used by these companies talks of increased ARPU for these operators. It typically manifests in the form of value-added services such as entertainment being sold to customers especially in markets where the primary service offered to the customer, such as the telephony or Internet service, is sold at a commodity rate. Method of Calculation: To calculate the ARPU, a standard time period must be defined. Most telecommunications carriers operate by the month. The total revenue generated by all units (paying subscribers or communications devices) during that period is determined. Then that figure is divided by the number of units. Because the number of units can vary from day to day, the average number of units must be calculated or estimated for a given month to obtain the most accurate possible ARPU figure for that month. 
10 Average revenue per user 7 Also related is ARPPU (Average Revenue Per Paying User) which is calculated by dividing up the revenue amongst the users who paid anything at all. This yields a figure that is significantly larger than ARPU. For example in the case of a subscription game (that has a free play version), the ARPPU, measured by accounts, is the subscription price, diluted slightly by free trials. A related (but less used) measure is AMPU, or average margin per user. ARPU is widely used by Internet Protocol television (IPTV) service providers. References  / searchtelecom. techtarget. com/ sdefinition/ 0,,sid103_gci ,00. html External links ARPU definition at Investopedia (http:// www. investopedia. com/ terms/ a/ arpu. asp) PC Magazine Definition (http:// www. pcmag. com/ encyclopedia_term/ 0,2542,t=ARPU& i=37990,00. asp) Bit Stream Access Bit Stream Access refers to the situation where a wireline incumbent installs a high speed access link to the customers premises (e.g., by installing ADSL equipment in the local access network) and then makes this access link available to third parties, to enable them to provide high speed services to customers. This type of access does not entail any third party access to the copper pair in the local loop. The incumbent may also provide transmission services to its competitors, using its ATM or IP network, to carry competitors' traffic from the DSLAM to a higher level in the network hierarchy where new entrants may already have a point of presence (e.g. a transit switch location). Bit-stream handover points thus can be at various levels: Handover at DSLAM Handover at ATM-PoP Handover at IP level Bit Stream Access is nowadays considered a key tool for opening competition in the broadband market. It enables competitors to offer their own products to consumers even if they do not operate the local loop (the last mile). Bit stream access allows the new entrant to use the high-speed modems and other equipment provided by the incumbent and thus avoid maintenance and investments into the local loop. This affects the economics of the service and places restrictions on the type of modems that the customer of the new entrant can buy or rent. The main elements defining Bit Stream Access are the following: High speed access link to the customer premises (end user part) provided by the incumbent and transmission capacity for broadband data in both direction enabling new entrants to offer their own, value-added services to end users; New entrants have the possibility to differentiate their services by altering technical characteristics and/or the use of their own network; Thus, Bit Stream Access is a wholesale product consisting of the access (typically ADSL) and backhaul services of the (data) backbone network (ATM, IP backbone).
11 Bit Stream Access 8 E.U. Regulation Unlike Unbundled Access, the provision of Bit Stream Access services is not mandated under European Community law, but where an incumbent operator provides Bit Stream DSL services to its own services, subsidiary or third party, then, in accordance with Community law, it must also provide such forms of access under transparent and non-discriminatory terms or conditions to others (Directive 98/10/EC Article 16). Note: Bit Stream Access service allows the incumbent to retain control of the rate of deployment of high speed access services, and the geographical regions in which these service are rolled out. From the regulatory point of view, such services are therefore seen as complementing the other forms of unbundled access, but not substituting them. Bypass (telecommunications) In telecommunications, the term bypass has these meanings: 1. The use of any telecommunications facilities or services that circumvents those of the local exchange common carrier. Note: Bypass facilities or services may be either customer-provided or vendor-supplied. 2. An alternate circuit that is routed around equipment or a system component. Note: Bypasses are often used to let system operation continue when the bypassed equipment or a system component is inoperable or unavailable. Source: Federal Standard 1037C and MIL-STD-188 Call accounting A Call Accounting System is a telecommunications software or hardware application that captures, records, and costs telephone usage events. Internationally call accounting systems may be referred to as call logging systems. Call accounting systems detect outbound and inbound calls, call ring outs, call routings, abandoned calls, and other activities.. Common Applications of Call Accounting Service Billing and Provisioning Call accounting systems may provide packaging, pricing, provisioning, billing, and posting or presentment of telephone services for purposes of revenue generation. Professional services firms utilize call accounting software for account code or client based billing of their phone usage. The hospitality industry uses call accounting to resell phone services to visiting guests and groups. These call accounting systems often provide accessible application-specific rating and provisioning capabilities found generally on carrier-level operational support systems (OSS) and business support systems (BSS). Departmental and Employee Chargeback The original purpose of call accounting systems was within corporate entities for purposes of cost allocations within the enterprise. Enterprises use call accounting to allocate costs back to divisions, departments, and even individual employees. Such systems may also provide data directly to corporate accounting and human resource systems. Cost and Revenue Optimization
12 Call accounting 9 Call accounting software can reconcile multiple telecom carrier's billing reports by integrating telecom invoices, wireless billing, long distance charges and calling cards into a single platform, allowing your business to use the convergent expense software to provide management reports, analytic reports, alerts and robust presentations Staff Productivity Call accounting systems provide visibility into the calling patterns and activity of employees and can be used to minimize productivity losses through non-business calling activity. They can also be used to evaluate the effectiveness of revenue-generating staff and sales processes, and manage the responsiveness of customer service staff. Network Optimization Companies also use call accounting systems to determine whether their voice and data networks are being utilized efficiently, in a cost effective manner, or to capacity. Call accounting applications are used to monitor network activity and bandwidth, identify over- and under-used trunks to optimize trunking configurations, pinpoint the root cause of circuit outages, monitor call routing effectiveness, queue times, abandoned calls and other information, and report usage trends and statistics. Call accounting can help companies more efficiently allocate telecom resources and make better planning decisions affecting a telecommunications network. Security and Compliance Call accounting applications enable IT departments to shield companies from a variety of internal and external security threats by monitoring for network attacks, intrusion attempts and telecom activity that exceeds acceptable or established thresholds. The Sarbanes-Oxley Act established new or enhanced standards for financial reporting by public companies and accounting firms, obliging them to examine and revise their internal governance, accounting and reporting controls. Examples of those internal controls include procedures for securing, protecting and ensuring the availability of critical infrastructure (like telecommunications systems), monitoring those systems for performance issues, and preventing or quickly detecting unauthorized attempts to acquire company records or assets. Call accounting applications help facilitate regulatory compliance by providing tools to aggregate, monitor and analyze telecommunications data in order to correctly track and report expenses. They can be used to enhance corporate accounting practices by documenting fraud-related costs to substantiate telephony-related disputes with carriers. And they can automate the monitoring of internal communications to improve visibility into sales and financial processes. Forms Call accounting capabilities can be acquired in several forms. Stand-alone hardware device Call accounting can be provided from a hardware device. Such solutions, especially ones with proprietary designed hardware buffers, have generally been static and with limited features, and are intended to support a single telephone switch. However some hardware solutions use a barebone PC or mini PC with software written to work within an operating system. These PC-based devices can support a wider range of PABXs depending on the software module written and is usually done by replacing or adding PABX specific software modules. Stand-alone server software Call accounting can be provided from a stand-alone server software product. Such solutions have more robust features and are intended to support a single or small number of phone switches and users. However these solutions also have a higher total cost of ownership by requiring management of one or several self-standing systems. Centralized enterprise software