How Communications Service Providers Can Transform Telecom Billing Operations to Support a New Convergent, Digital Business

How Communications Service Providers Can Transform Telecom Billing Operations to Support a New Convergent, Digital Business

Executive Summary Ubiquitous technology innovations, a structural evolution in customer demand, and competition from a variety of new players are dramatically reshaping the communications and media industries. In the process, these trends are pressuring communications service providers (CSPs) to bring new digital products and services to market, and do so more quickly than ever. Yet as they work to transform their businesses in response to these trends, CSPs find it difficult to surmount a major obstacle: their own billing capabilities. In fact, in a recent Accenture survey, 92 percent of CSP executives said their telecom billing system was at least somewhat of an impediment to launching new offers. Just under half indicated it was a major barrier. Our study also uncovered many other billing-related challenges that make it difficult for CSPs to create a more customer-centric business capable of providing the digital products and services customers desire. Sixty-six percent of CSPs continue to struggle with maintaining bill accuracy. Sixty percent considered billing for bundled services and having the right data volume processing capabilities major concerns. Seventy percent said their billing systems take too long to configure for new products or services. And approximately 80 percent said the areas most in need of improvement among their billing systems are handling convergent (triple-play or quadplay) billing, ease of configuration, supporting real-time charging and billing, and scalability. These and other findings left us with one inescapable conclusion: CSPs that do not transform their billing capabilities to accommodate the new competitive and customer reality will become casualties as the digital content revolution enters its next phase. In this paper, we explore in more detail the industry trends affecting CSPs and how these trends are forcing CSPs to transform how they do business especially in their business support systems (BSS) and associated billing operations. We also outline how some leading CSPs have upgraded their billing capabilities, consolidated their billing applications, and teamed with external partners to transform their billing capabilities to accommodate new business strategies and offerings with minimal risk and disruption to the business. 3

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Section I: The Latest Evolution in the Communications and Media Industries Several significant trends are challenging the communication and media ecosystem. Four are particularly noteworthy for their scope and impact on traditional CSPs. Proliferation of intelligent devices. Always-on, always-connected devices are becoming mainstream, going far beyond the segment of digital customers who purchase these devices largely as an expensive toy. For instance, according to research firm Gartner, about 63.6 million tablets were sold worldwide in 2011, an increase of 261 percent over the 17.6 million that consumers bought in 2010. 1 Smartphone ownership and usage are growing as well, with penetration in the handset market reaching 40 percent in Western Europe and 38 percent in the United States, and half of consumers in Asia Pacific indicating plans to purchase one. 2 Smartphones and other devices also are making inroads among business customers, progressively enhancing sales force processes and operations. The surge in smartphone and tablet adoption is driving impressive growth in mobile data subscriptions (57 percent growth rate between 2008 and 2010 in Western Europe), consumption (monthly data usage in the United States rose from 230 megabytes to 435 megabytes in the first quarter of 2011), and behavior (25 percent of US Web users now are mobile only ). 3 Increased customer sophistication. Customers are becoming more savvy and experienced, preferring to choose and be billed for communication services according to their usage instead of opting for all-in-one bundled offerings. Furthermore, customers awareness of offering features among different market players has been boosted by the increased relevance of social networks on purchasing decisions. According to Accenture research, just under 30 percent of consumers globally said negative and positive comments about a company s product or service contribute to their consideration of those offers when planning to buy, and 27 percent of consumers globally said their use of social media sites has increased their overall awareness of products and services from providers they did not know of previously. 4 Network commoditization. The year 2012 will be the first in which consumer fixed broadband revenues worldwide will be higher than fixed voice revenues ($180.5 billion, compared with just $158.6 billion). 5 However, although overall broadband revenue increased, fixed broadband pricing decreased by 35 percent between 2008 and 2010 in developed countries, 6 even while expectations for network reliability and quality of service remain high among fixed broadband customers, whose fixed data traffic is increasing by 38 percent CAGR in 2011 and is expected to remain in the 30 percent range until 2015. 7 Concurrently, CSPs are making significant investments in their networks, especially mobile broadband, to meet customer demand. The pressure thus is on CSPs to develop the pricing models and related high-value services to generate acceptable return on those investments. New competition from content and over-the-top companies. In the past few years, the prevalence of overthe-top players has exploded. In fact, applications and services provided by such companies now account for the bulk of Internet bandwidth usage. Having invested considerably in developing the networks on which these over-the-top services ride, not to mention building and launching their own content services, CSPs understandably are concerned that such providers will end up capturing the significant value of streaming video, audio, applications, and other digital content while CSPs are stuck with the costs of having to operate and maintain the pipe. 5

These trends collectively are dramatically altering the landscape of the communications and media industries. To keep pace, CSPs must make significant, often radical, changes to the products and services they offer customers, the ways in which they use their networks, and the markets they serve. They also must develop innovative business models for working with their partners ecosystems. For instance, to retain existing customers and attract new ones, CSPs must deliver an ever-increasing array of new offerings, bundles, services and applications. They also must provide a Web-like, real-time user experience to accommodate users increasing time spent on the Web doing more things with more devices, and make content available and usable across a diverse and increasing mix of devices. CSPs also have to leverage network assets in new ways to counteract the decline in traditional revenue streams and margins due to competition and bundling. For example, to counteract slowing growth and rising program costs in their television business, many cable companies are exploring implementing usage-based pricing for Web access, whose margins are double that of traditional video programming. In doing so, these companies hope to capitalize on the booming popularity of watching streaming video programs via the Web. Another growth opportunity for CSPs is the emerging machine-to-machine (M2M) market. Vodafone predicts that by the year 2020, common technology such as cars and home appliances will be connected to the mobile network. 8 Seeking to capitalize on that trend, the company has launched an ambitious suite of M2M services designed to help connect a wide range of devices to its mobile network. 9 Vodafone is not alone; other CSPs also are looking to take a leadership role in M2M. In fact, 58 percent of executives participating in Accenture s survey of CSPs said they want their companies to be the prime contractor in M2M businessto-business applications, while 54 percent said the same for business-to-consumer applications (see About the Research on page 7 for more details on the survey). Even more broadly, CSPs have the potential to grow by leveraging their brand and infrastructures to sell any kind of digital products and services, even those that are far beyond traditional telco offerings (such as cloud, Content Delivery Network, e-health and financial services). The key is CSPs know they no longer can grow by operating as traditional communications businesses. Instead, they must offer a diverse range of traditional broadband services and content to respond to the changes in the market and capitalize on the growth opportunities these changes provide. 6

About the Research To explore the changing communications marketplace and the role of billing within communications service provider (CSP) business support system (BSS) operations, Accenture interviewed 50 CSP executives from the communications and media industries in Western and Eastern Europe, Latin America, and the Middle East and Africa. The survey covered various aspects of these executives priorities, challenges and vision related to billing in their organizations. The insights gained from those interviews have helped Accenture formulate its perspective on what telecom billing means, now and in the months ahead. Participating companies were large (80 percent had revenues of more than $1 billion) and predominantly based in Europe (70 percent). Executives interviewed were nearly evenly split between representatives of business functions (52 percent) and IT (48 percent). 7

Section II: Billing Operations Are Increasingly an Obstacle to Responding to Industry Changes As they seek to develop new business models, products, and services to respond to changes in technologies, customer demand and behavior, and competition, CSPs typically find their current billing capabilities are not up to the challenge. Executives in the Accenture survey reported that numerous and significant shortcomings in their companies billing operations are preventing them from more effectively accomplishing their business goals and satisfying customers needs. For example, 20 years after the deregulation of the communications market, billing accuracy remains a problem. In the Accenture study, 66 percent of respondents said bill accuracy is one of their key billing challenges (Figure 1). Companies continue to struggle with billing accuracy because current billing platforms have difficulty accommodating the expanding array of new services and devices and explosion in the amount of data consumed by customers. Billing for bundled services and having the right data volume processing capabilities also are major concerns, each cited by 60 percent of respondents. Limitations in billing systems are widespread among CSPs as well. Seventy percent said their billing systems take too long to configure for new products or services, and an equal percentage indicated their billing system is not effectively integrated with other key systems (such as CRM, product catalog, order management and billing) (Figure 2). Other prevalent billing system constraints cited by executives include accommodating increasingly complex service and pricing plans, named by 50 percent; functional limitations of existing IT systems (for instance, when a new product requires features currently not supported by the system), cited by 48 percent; and lack of real-time simulation capabilities, identified by 30 percent. Reinforcing the preceding, the amount of effort needed to integrate billing systems with other applications, and the amount of billing software development (as opposed to more simple configuration) needed to accommodate new offerings, are the two most prominent challenges executives said they face in reducing time to market to launch new products or services (Figure 3). These challenges were cited by 80 percent and 70 percent of executives, respectively. Additionally, 64 percent cited testing and complexity of configuration as challenges, while 58 percent indicated product time to market was inhibited by multiple billing platforms in need of upgrades. Figure 1: Key Challenges to Telecom Billing Operations Billing accuracy 28% 66% Cost (operational expenditure or OPEX) is too high Billing for bundled services Data volume processing capabilities Telecom-to-enterprise billing Billing models for new services (e.g., machine-to-machine, cloud) Revenue leakage 30% 28% 32% 47% 60% 60% 49% 60% 60% 38% 23% 34% Real-time billing 34% 38% 0% 20% 40% 60% 80% 100% Important Critical 8

Figure 2: Main Billing System Constraints in Launching New Products and Services Time to market (configuring new products and services takes too long) Integration between CRM, product catalog, order management and billing 70% 70% Complexity of services and price plans definition 50% Functional limitation of existing IT systems (e.g., new product requires features currently not supported by IT) 48% Real-time simulation capabilities 30% Limited capabilities in current billing services catalog 18% Other 12% 0% 10% 20% 30% 40% 50% 60% 70% 80% Figure 3: Billing Challenges CSPs Face in Meeting Time-to-Market Targets for Launching New Products and Services Integration effort Software development (or change request) often needed (vs. configuration only) Testing 70% 64% 80% Main challenges faced by organizations Complexity of configuration 64% Multiple platforms need to be updated 58% 0% 10% 20% 30% 40% 50% 60% 70% 80% 9

Figure 4: Telecom Billing System Performance on Key Capabilities Convergent (triple-play, quad-play) 49% 36% 85% Flexible (easily configurable) 47% 34% 81% Real-time charging and billing support 30% 49% 79% Scalable 45% 32% 77% Business-to-business billing 49% 22% 71% Upgradable 40% 30% 70% Support third-party services 43% 25% 68% SOA (service-oriented architecture) 34% 34% 68% Ability to support pre-paid and post-paid payment methods 36% 30% 66% Reliable (100% bill accuracy, no revenue leakage) 53% 11% 64% Complex customer hierarchy 36% 28% 64% Interconnect billing compliant (ease of integration) Roaming support 21% 43% 30% 14% 57% 51% Mixed performance - some improvements required B2C billing 28% 18% 46% Significant improvements required 0% 20% 40% 60% 80% 100% 10

And a majority of executives said their billing system needs at least some improvement in 13 of 14 capabilities about which Accenture asked, with the areas most in need of improvement being handling convergent (triple-play or quad-play) billing (85 percent), ease of configuration (81 percent), supporting real-time charging and billing (79 percent), and scalability (77 percent) (Figure 4). Add it all up and it s not surprising to learn that 92 percent of executives said their billing system is at least somewhat of a constraint in launching new products and services (Figure 5). In fact, 68 percent of executives in our study said it currently takes them more than a week to implement tariff changes, and 84 percent said it takes them two months or more to develop new products or services (including 34 percent who said it takes longer than six months). This is a major challenge for CSPs given the critical importance of time to market in this highly competitive industry, and it is an area in which CSPs recognize they have much work to do. Interestingly, IT respondents are far less likely than their business counterparts to see billing systems as an issue. Just 33 percent of IT executives, compared with 58 percent of business executives, said their telecom billing system is a constraint in launching new products or services. And the same percentage of IT executives, compared with 62 percent of business executives, think their current billing system constraints are related to functional limitations in existing IT systems. These findings suggest there is a significant gap between CSPs existing billing system capabilities and what the business really needs to be competitive. Keeping billing costs as low as possible is also a major challenge for CSPs, especially as they work to transform their billing capabilities to keep pace with market demands. Judging from our study, CSPs have experienced some success in this regard. Only 34 percent of executives said the high operating cost of billing is a major challenge, and 70 percent of executives reported the current cost of their billing operations is less than 2 percent of revenue. However, CSPs know cost is an ongoing concern, and continually finding ways to reduce operating costs is critical to maintaining margins as they begin providing a broader range of products and services. Figure 5: Extent to Which the Billing System Is a Constraint in Launching New Products and Services To a significant extent To a large extent 22% 24% 46% of companies view their current billing system as a major constraint To a limited extent 46% Not at all 8% 11

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Section III: Transforming Billing Capabilities Is Key to the Success of CSPs New Business Strategies The preceding findings from our study make one thing very clear: CSPs that don t implement more effective billing capabilities to accommodate the new competitive and customer reality will become casualties as the trends cited earlier continue to play out. Indeed, because billing remains a key tool for CSPs to manage customer satisfaction, it must evolve from a traditional back-end, batch operation to one that is customer centric and operates in real time. With the explosion of new data and content services, CSPs face a clear risk of confusing and losing customers with inaccurate bills or billing capabilities that don t support customers desired ways of interacting with providers of digital products and services. A CSP must be able to accommodate a new type of customer who does not fit the pre-paid or post-paid bandwidth subscriber profile. Such customers do not want to subscribe to a provider s monthly plan, but do want access to services or applications they value such as streaming video or online gaming. They also want CSPs to be more proactive in providing high-quality services that are meaningful to them. Thus, CSPs must be able to charge these customers for access specifically to these services and applications (by the minute or via a subscription, for instance) independent of whether they are traditional customers, as well as offer more personalized marketing and tariff suggestions tailored to customers preferences and needs. Billing systems also must enable customers any customer to register online, select the options they want to purchase, activate their subscription, use the service immediately, know how much the data or time they consumed cost (and do so in real time), and manage their account online. Yet for most CSPs, this remains a dream today because their billing capabilities are not capable of handling such scenarios. Introducing a new offering such as media services simply would be too complex for these systems to handle. Thus, for CSPs to become providers of media services which is essentially the competitive challenge these companies face today they must remove the billing barriers. And for most CSPs, removing those barriers requires nothing short of a complete transformation of a company s billing operations. In the past decade, Accenture has put its extensive knowledge and experience to work helping CSPs around the world do just that: transform billing. With more than 2,000 BSS professionals focused on CSP billing, Accenture provides the full range of consulting, technology and business process outsourcing services that can enable CSPs to develop and deploy the billing capabilities necessary to support a more customer-centric business that delivers the digital products and services customers demand. In fact, the BSS solutions Accenture has implemented at more than 200 CSPs worldwide collectively manage and bill more than 250 million subscribers, and in the past five years alone, Accenture has collaborated on business transformation projects with 95 of the world s top 100 communications companies. Through this experience, we have found there are three keys to transforming billing: enhancing and augmenting foundational billing capabilities; reducing the cost and complexity of billing platforms; and teaming with strategic partners to reduce risk and speed time to market. Enhancing Billing Capabilities As part of a billing transformation, CSPs should focus on adding, upgrading or enhancing the capabilities that will enable them to accommodate new services and types of customers. This is something executives participating in the Accenture survey recognize: 70 percent either are investing already, or are planning to invest in the next few years, in adding new capabilities. Two of the most important billing capabilities CSPs should focus on are convergent billing and real-time rating. Sixty-six percent of executives in Accenture s survey said convergent billing is an important billing priority in the next two years (and, in fact, 53 percent of CSP executives in emerging markets indicated it is a top priority), while just over half of all participating executives said they are planning to implement real-time rating in the same timeframe. 13

Convergent billing Becoming a media business requires CSPs to move beyond traditional internal silos of services (fixed telephony, mobile telephony, broadband and TV) and payment arrangement (pre-paid versus post-paid) to one unified view of each customer regardless of what they purchase or how they pay. Convergent billing not only enables a CSP to sell more and different media services to all customers more efficiently, but it also improves the customer experience by making it easier for customers to see on one bill the services they have purchased; helping customers control their spending by providing flexible charging, spending controls and payment options; and enabling customers to manage their entire household account online. One global operator foresees a positive impact by moving to convergent billing. The company s mobile division offers both pre- and post-paid services, which are supported by different systems and technologies. Working with Accenture, the company is analyzing how to combine the best capacities of both areas to put in place a single platform, which will enable the company to support nextgeneration product and service bundles more easily, offer more targeted offers and communications, and manage credit limits and fraud more effectively. Just as important, this new approach enables significant IT consolidation, cost savings, flexibility improvements, and faster time to market that also would be applied to the wireline division. Another company that has realized the benefits of convergent billing is a business unit of a leading cable service provider. With Accenture s help, the company implemented a new end-to-end system to meet its evolving CRM, billing, provisioning and enterprise resource planning (ERP) needs. Importantly, the solution enables the company to execute convergent billing, wherein a single bill is sent to each customer regardless of the customer s location or the complexity of the service bundles he or she has purchased. The solution also allows the company to more easily trace key pieces of information, from order status to customer contact information, to each transaction that has occurred over the customer lifecycle. With this more complete customer information, the company can both provide better service more effectively as well as cross-sell and upsell its most promising customer accounts. Real-time rating To sell subscriptions to services and applications, CSPs billing systems must be able to track and bill for usage as it happens for instance, in terms of minutes or seconds of use, or amount of data transferred, or a combination of both. The system also must be able to inform customers in real time how much their use of an application or service will cost them so they know in advance what to expect. Currently, many CSPs have taken a small step toward real-time rating by implementing standalone charging solutions, which have enabled them to patch their existing billing architecture to rate and potentially authorize access to specific services. However, such solutions represent a very tactical move. To be most effective, charging solutions should be part of a larger billing transformation road map that a CSP develops to guide its move to an end-to-end online media business. A leading wireless provider in Europe is one CSP that is at the forefront of using realtime rating. The company was one of the first to provide third-generation (3G) mobile phone services in its marketplace when it launched in 2003. As part of its launch, the company recognized a billing system that could support real-time convergent rating and charging would be critical to its success in a highly competitive local mobile phone market. The system would have to enable the company to bill all types of services and content offered through its network: phone calls, messages, video streaming and mobile TV, as well as content downloaded and other multimedia services offered through a variety of vertical applications. Working with Accenture, the company was able to develop and implement its billing system, which was integrated with the company s Service Delivery Platform architecture and appropriate processes (such as payper-event, pay-per-web-page, and payper-subscription) as the foundational layer to enable delivery and billing for its multimedia products and services. With the help of its new real-time billing platform, this company has amassed more than 10 million customers and grown to become one of the leading players in its local wireless telecommunications market. In some cases, the cloud can help companies selectively add new billing capabilities or improve existing ones, and do so quickly and cost effectively. In fact, cloud-based charging and billing platforms are increasingly on CSPs agenda as a way to improve their billing performance (Figure 6). Currently, just 6 percent of CSPs in the Accenture study use such platforms. However, 30 percent are planning to adopt cloud-based billing solutions in the next two years, and another 30 percent currently are discussing the possibility. 14

The cloud can be especially helpful to CSPs with geographically dispersed business units or affiliates. When one major incumbent European CSP wanted to roll out its new Internet brand across Europe, it decided a centralized internal cloud (which included billing), physically located in the company s home country, would be the best option. The company subsequently introduced the brand in 10 European countries without using physical IT systems in any location. These affiliates access all their IT services remotely through the home country-based platform. Another tool that holds promise for improving billing is analytics, although its use in billing by CSPs is still in the early stages (Figure 7). Among companies in the Accenture study, 30 percent said they already use analytics to support advanced real-time billing management and another 40 percent said they plan to implement such tools in the next two to three years. Just under 80 percent said their main reason for using or planning to use analytics in such a way is to improve customer loyalty. Twothirds said such tools help them conduct real-time segmentation and profiling and 60 percent said analytics improves product profitability. Just over half indicated analytics tools help them optimize their offering portfolio and 43 percent reported they help improve product pricing definition strategy. One way a CSP can use analytics is to help develop a unified view of its business customers matching internal data to information from external sources to create more effective market segmentations. With better customer profiles, a CSP can more effectively pinpoint which customers have the greatest potential for new business. The segmentations also can help a CSP create a comprehensive customer file a one-page view of relevant account information that enables the sales force to serve customers better and increase upselling and crossselling success. Figure 6: CSPs Plans for Using Cloud-based Charging and Billing Platforms Figure 7: CSPs Use of Analytics to Support Billing Yes, we already do Yes, this is planned in the next two years 6% 30% 36% of companies already leverage or plan to leverage cloud-based charging and billing platforms Yes 30% 70% of companies already leverage or plan to leverage analytics applications Yes, this is in discussion but not planned 30% No, but it is planned in the next two to three years 40% Not planned 34% No, not considered 30% 15

Reducing the Cost and Complexity of Billing Platforms While adding powerful new billing capabilities is critical, it generally is not enough. Many CSPs are further challenged by the complexity, rigidity and cost of their multiple legacy billing systems. Thus, moving billing applications to a new, more agile, simpler and cost-effective technology platform also is key to helping CSPs accommodate the provision of new media services and their associated billing, and to help improve margins by further reducing the cost of billing. CSPs certainly recognize the need. In the Accenture survey, for example, 64 percent of executives indicated they were investing in or planning to invest in consolidating their current billing solutions, and 64 percent consider consolidating multiple billing systems a top priority for the next two to three years. Just under half (49 percent) of executives expected to replace legacy billing systems with new package software. One example is a major convergent telco operator in Italy, which implemented a more agile billing platform as part of a broader transformation of its CRM and billing operations. The company worked with Accenture to retire 90 percent of its legacy systems and migrate all 24 million of its customers to new leading software packages. This legacy retirement played a key role in the larger program s success: It helped reduce the company s BSS operating and capital expenses by 40 percent over three years while improving the company s ability to launch important new products and services. In an emerging market, one CSP enjoys significant operational and financial benefits as a result of moving its billing and other BSS functions to a new software solution. The company had a core system developed in an earlier era, when landlines were the chief need of its customers. By the late 2000s, this system was beginning to show its age. The system made it difficult for the company to bring to market quickly the bundled service offerings customers demanded in fact, one such offer required more than a year to be developed and offered for sale. Working with Accenture, the company moved its operations to an integrated BSS software suite from a leading solution provider. The new solution allows the company to launch innovative bundles that deliver a full range of products, services and brands with much greater speed and efficiency. The company was able, for instance, to develop and launch an offer combining a new personal computer with IPTV, DSL and mobile broadband in just one week, while launching a similar bundle previously would have required more than a year. In many cases, CSPs opt for outsourcing to help reduce cost and complexity in their billing operations (Figure 8). For instance, in the Accenture survey, 68 percent of executives said they currently use an external IT services provider for billing application development and maintenance, while 40 percent indicated they are outsourcing billing trouble ticket resolution. Twenty-four percent actually outsource their entire billing operation, while 14 percent outsource billing catalog management and 6 percent outsource billing controls and reporting. Figure 8: CSPs Use of Outsourcing in Billing Ongoing or planned Billing application development and maintenance 10% 2% 68% 70% Billing trouble tickets resolution 8% 6% 40% 46% Billing operations 8% 6% 24% 30% Billing catalog management 14% 6% 14% 20% Billing controls and reports 10% 10% 6% 16% 16 0% 10% 20% 30% 40% 50% 60% 70% 80% Planned to be outsourced In discussion but not planned in the next two years Currently outsourced to an external provider

Teaming with Strategic Partners Billing transformation is vital to not only fostering short-term improvements in a CSP s competitiveness and responsiveness to customers, but also to helping CSPs become a convergent media and communications company. However, such an effort can involve significant time and money, not to mention risk. Simply from a technology perspective, replacing every outdated legacy billing system is extremely challenging given the associated expense and potential disruptions to the business. Add to that the related business process and workforce considerations, and it s understandable why CSPs find making the transition to a new business model an imposing challenge. In fact, as the magnitude of the effort needed to transform billing becomes clearer to CSPs, many are looking to partner strategically with external parties that can bring key expertise and capabilities to the table. Such partners, as part of a multi-year journey, can help CSPs move to a highly flexible and cost-effective BSS that can enable them to deliver a consistent and personalized customer experience across multiple delivery channels, execute timely launches of new products and services, spur revenue growth, and increase customer retention. Often, such partners are experienced in deploying robust plug and play solutions and assets that CSPs can take advantage of to speed the adoption of a new BSS, thus substantially reducing the time it takes for them to make the transition to a new business model. In some cases, it makes sense for CSPs to embark on a more strategic outsourcing arrangement with a third party to more quickly monetize the new core BSS capabilities and reduce the risk involved in migrating to a new platform. This is the path taken by PosteMobile, a mobile virtual network operator in Italy and part of Poste Italiane group, which worked with Accenture to help it begin selling mobile phone services. In its role of mobile virtual network enabler, Accenture built and maintained all the IT infrastructure needed to support PosteMobile s core business processes. In addition to providing and maintaining the IT platform, Accenture was asked to deliver operations and management services as well as business process outsourcing services that included service configuration and testing of handsets and SIM cards. Accenture completed the design and implementation of PosteMobile s infrastructure in fewer than five months, during which Accenture built 102 interfaces and integrated 41 systems, including those from Poste Italiane and the company s selected network operator. Accenture helped enable 60,000 dealer users and 13,800 Poste Italiane offices to sell mobile services. In the first month of operation as a start-up company, PosteMobile attracted 100,000 subscribers and captured 7,000 activation orders per day at the peak of this growth. Within two months of the launch date, PosteMobile became the leading Italian mobile virtual network operator in terms of customer base and is well on the path to high performance in a highly competitive industry. 17

Emerging Versus Mature Markets: Different Perspectives on Telecom Billing and Growth Accenture s survey of communications service provider (CSP) executives included companies in both mature and emerging markets. While both groups agreed on a number of issues, they did diverge often quite substantially on others. The most significant of these differences are the following: CSPs in emerging markets are twice as likely as those in mature markets (59 percent versus 30 percent) to say delivering continuous innovation is one of their main priorities to drive growth in the next two to three years. On the other hand, CSPs in mature economies are five times more likely than their emerging-market counterparts (33 percent versus 6 percent) to say meeting new customer demand is a priority. A higher proportion of CSPs in emerging markets versus mature economies see the implementation of convergent billing as a key priority to support growth in the next two years. In fact, executives in emerging markets were twice as likely as their colleagues in mature markets to consider convergent billing a top priority (53 percent versus 27 percent). As far as investments in billing capabilities are concerned, a much higher share of CSPs in emerging markets (88 percent) than in mature ones (48 percent) are currently investing in, or planning to invest in, end-toend integration. A majority of CSPs in mature markets (54 percent) are operating their billing system with the help of a third party, while three-quarters of CSPs in emerging markets are doing so in house. 18

Conclusion Although the major trends driving the communications industry are certainly disruptive to communications service providers (CSPs), they also represent significant opportunities for growth. With use and consumption of digital content at an all-time high and rising, and innovation in new connected devices continuing apace, companies that can build the right business models and deliver the right offerings will be well positioned to ride this wave and capitalize on the opportunities presented. Some leading companies, as illustrated in the preceding discussion, are well on their way. One of the keys to riding the wave will be overcoming the myriad billing shortcomings companies in Accenture s survey reported. As was well documented by our research, CSPs have considerable work to do in the billing area to eliminate the barriers that prevent them from becoming a stronger player in the industry and, for some companies, that may even threaten their viability as customers become more demanding and competitors grow more innovative and nimble. A formal, rigorous approach to transforming telecom billing capabilities aided, when necessary, by an experienced third party can help CSPs create a robust platform that enables them to implement their next-generation strategies and business models. With convergent, realtime billing, complemented by powerful new BSS operations, CSPs can reduce time to market for in-demand new products and services, become more customer centric, and create a more compelling point of competitive differentiation all of which is required for them to thrive in this rapidly changing marketplace. References 1 Forecast: Media Tablets by Operating System, Worldwide, 2010-2014, 3Q11 Update. Gartner. Carolina Milanesi and Roberta Cozza. 16 September 2011. 2 Nielsen, Smartphone Penetration in Asia Set to Boom, July 2011. http://blog.nielsen.com/nielsenwire/ global/smartphone-penetration-in-asia-set-to-boom/. 3 Nielsen, Average U.S. Smartphone Data Usage Up 89% as Cost per MB Goes Down 46%, June 2011. http://blog.nielsen.com/nielsenwire/online_mobile/ average-u-s-smartphone-data-usage-up-89-as-costper-mb-goes-down-46/. 4 Accenture Global Consumer Research 2011, http://www.accenture.com/us-en/pages/insight-acnglobal-consumer-research-study.aspx. 5 Global Fixed Voice and Broadband Market Outlook: 2011-16, Steven Hartley, Charlie Davies, September 2011, Ovum. 6 ICT services getting more affordable worldwide, International Telecommunication Union press release, May 16, 2011, http://www.itu.int/itu-d/ict/ipb/. 7 Cisco Visual Networking Index: Forecast and Methodology, 2010 2015, Cisco white paper, June 1, 2011, http://www.cisco.com/en/us/solutions/collateral/ ns341/ns525/ns537/ns705/ns827/white_paper_c11-481360.pdf. 8 Intelligent cars on way, says Vodafone, Hamish Fletcher, The New Zealand Herald, August 3, 2011, http://www.nzherald.co.nz/technology/news/article. cfm?c_id=5&objectid=10742565. 9 According to the Vodafone website, http://m2m. vodafone.com/home/. 19

About Accenture Accenture is a global management consulting, technology services and outsourcing company, with more than 244,000 people serving clients in more than 120 countries. Combining unparalleled experience, comprehensive capabilities across all industries and business functions, and extensive research on the world s most successful companies, Accenture collaborates with clients to help them become high-performance businesses and governments. The company generated net revenues of US$25.5 billion for the fiscal year ended Aug. 31, 2011. Its home page is www.accenture.com. Contact Us For more information, please contact: Jean-Marie Pierron Senior Executive, Global Billing Lead, Communications, Media and Technology Practice, Accenture jean-marie.pierron@accenture.com; or Frédéric Schmeler Global Alliances Channel Director, Communications, Media and Technology Operating Group, Accenture frederic.schmeler@accenture.com; or Francisco (Paco) Carvajal Executive Director, Spain and Latin America Communications Industry, Accenture francisco.carvajal@accenture.com; or Juan Morlanes Communications Industry Billing Subject Matter Expert, Communications, Media and Technology Operating Group, Accenture juan.morlanes@accenture.com. Or visit us at www.accenture.com/billing. Copyright 2012 Accenture All rights reserved. Accenture, its logo, and High Performance Delivered are trademarks of Accenture. This document is produced by consultants at Accenture as general guidance. It is not intended to provide specific advice on your circumstances. If you require advice or further details on any matters referred to, please contact your Accenture representative.