Data Mining

Be careful what you wish for! Mobile operators offering flat-rate mobile data plans have driven such tremendous customer adoption of mobile data services that they have, in some cases, invited the unintended consequences of revenue-less traffic growth and services substitution, presenting significant and critical challenges to operator business models.

Can operators turn back the clock to reinstate mobile content billing models based on volume, duration, download, or per event in this era of all-you-can-eat mobile data services? Could a more flexible and dynamic charging approach lead to services differentiation and thereby increase revenues? For mobile operators to be financially successful, they must be able to generate new revenue, strengthen the value of their brands, and differentiate their services to attract and retain customers.

Differentiated and Personalized Services

Mobile operators need to introduce innovative and differentiated services to increase average revenue per user (ARPU). A key requirement for monetizing advanced services is the ability to identify the application, service, or content. For this, mobile operators need intelligent network, content examination, and deep packet inspection capabilities that provide the subscriber and application awareness needed to create the services plans that will appeal to subscribers. With these advanced capabilities – often combined with policy management solutions – mobile operators can offer differentiated services while letting users select and pay for services that they want and value. As such, policy and charging seem inextricably intertwined for operators to meet the goal of services differentiation.

Why is Billing Important in a Tiered Quota Data Usage Model?

Flat rate mobile broadband plans are typically offered at tiered usage levels (e.g., Light, Medium, Heavy) with monthly fair usage policy (FUP) quotas. These bundles give subscribers a “pay for what you need” option at the mobile data usage level.

Once monthly quotas are reached, operators have several ways to notify subscribers or restrict services while maintaining subscriber satisfaction. With service-aware capabilities to differentiate among services types, and to subsequently “bill” (i.e., essentially meter) the usage by any means (e.g., by volume, duration, download, event, etc.) that best reflects the particular services used, mobile operators can transition from flat-rate to value-added charging. For example, if a “Medium” data plan customer exceeds his or her monthly overall GB consumption limit for the month, the operator will want to preserve the user’s loyalty while enforcing the plan’s FUP quota. The operator might permit ongoing unlimited access to web browsing and other low-bandwidth services, while reducing (or rate limiting) network speeds for other high-bandwidth services (e.g., video). Thus, instead of blocking all services once a subscriber quota is reached, the operator selectively rate limits service levels while maintaining subscriber satisfaction and retention, while at the same time better managing network resources across all subscribers.  Additionally, the operator could present to the subscriber a real-time option to add funds on a pay-as-you-go basis, or in this case, upgrade the Medium plan user to the “Heavy” usage plan with higher monthly data usage quotas.

This kind of services flexibility requires a services-aware charging system, often working in tandem with policy management for additional services options. Even with flat-rate or tiered quota bundles, the operator still needs services-aware capabilities to meter subscribers’ usage by volume/duration/download/event in order to count such usage against monthly quotas, and then potentially to charge for subscribers’ usage, again by volume/duration/download/event, depending upon the operator’s business model and policy enforcement capabilities. This flexibility provides a significant revenue opportunity for mobile operators from the finer segmentation of its customer base.

The ability of service-aware charging for IP packet content also meets other business needs, such as reverse-billing to content providers, data mining to identify the most popular sites, content filtering, and supporting lawful-intercept requirements in certain countries.

Has the cow already left the barn re. mobile services / content charging? Will users accustomed to early flat-rate plans be too “spoiled” to accept any restrictions on usage?  Will they see value in the operator’s capability to enable (and charge for) more personalized subscriber plans?