Revenue assurance strategies for recession and recovery
Telcos are increasingly viewing revenue assurance (RA) as a lever for growth in these times of recession and recovery. It has moved from being a “billing issue” that is the responsibility of the CIO, to being an issue for the CEO.
We have witnessed the increasing importance of the RA function for a number of operators across the globe, but the underlying reasons for this trend vary widely by region. For North American telcos, the driving factor is revenue leakage from bundled services, while their European counterparts are struggling to gain revenues from new services such as content downloads.
Whichever market you look at, policing the revenue management chain remains the key task of the RA function. However, the techniques used to police the revenue management chain differ significantly, as some telcos focus on leakage detection, while those with mature RA functions are increasingly focusing on leakage prevention, thanks to a range of tools at their disposal such as baseline reporting.
We have witnessed the increasing importance of the RA function for a number of operators across the globe, but the underlying reasons for this trend vary widely by region. For North American telcos, the driving factor is revenue leakage from bundled services, while their European counterparts are struggling to gain revenues from new services such as content downloads.
Whichever market you look at, policing the revenue management chain remains the key task of the RA function. However, the techniques used to police the revenue management chain differ significantly, as some telcos focus on leakage detection, while those with mature RA functions are increasingly focusing on leakage prevention, thanks to a range of tools at their disposal such as baseline reporting.
Executive summary
In a nutshell
Ovum view
Key messages
Falling revenues are intensifying telcos’ revenue assurance activities
Policy management can be a weak link
Telco approach varies by region
Suppliers’ lack of end-to-end expertise is limiting telcos’ aspirations
Rise of mobile application downloads is adding to the woes
Focus is changing from reactive monitoring tools to proactive investigations
Implications for telcos
CEO priorities for revenue assurance
Market overview
Revenue assurance function within telecoms organizations
Revenue assurance key task: policing the revenue management chain
Market drivers
Pressures to increase margins and launch new services
Revenue assurance pain points for telecoms service providers
Coordinating billing, invoicing, and payments
New services and the rise of prepaid and mobile Internet
Rising number of billable transactions
Revenue sharing with third parties
Staffing challenges in revenue assurance departments
Supplier expertise
Lack of process expertise
Root causes vary across fixed, mobile, and cable operators
Revenue assurance best practices
Leakage detection
Leakage prevention
Leakage mapping
Baseline reporting
Probability analysis
What lies ahead for revenue assurance
Baseline reports usage will rise
Need to gain the backing of the board
Expanding scope of RA function
Margin assurance will become mainstream
In a nutshell
Ovum view
Key messages
Falling revenues are intensifying telcos’ revenue assurance activities
Policy management can be a weak link
Telco approach varies by region
Suppliers’ lack of end-to-end expertise is limiting telcos’ aspirations
Rise of mobile application downloads is adding to the woes
Focus is changing from reactive monitoring tools to proactive investigations
Implications for telcos
CEO priorities for revenue assurance
Market overview
Revenue assurance function within telecoms organizations
Revenue assurance key task: policing the revenue management chain
Market drivers
Pressures to increase margins and launch new services
Revenue assurance pain points for telecoms service providers
Coordinating billing, invoicing, and payments
New services and the rise of prepaid and mobile Internet
Rising number of billable transactions
Revenue sharing with third parties
Staffing challenges in revenue assurance departments
Supplier expertise
Lack of process expertise
Root causes vary across fixed, mobile, and cable operators
Revenue assurance best practices
Leakage detection
Leakage prevention
Leakage mapping
Baseline reporting
Probability analysis
What lies ahead for revenue assurance
Baseline reports usage will rise
Need to gain the backing of the board
Expanding scope of RA function
Margin assurance will become mainstream
LIST OF FIGURES
Figure 1: Telco revenue management chain
Figure 2: Telco revenue growth: 3Q09 versus 2008
Figure 3: Telco EBITDA margins: 3Q09 versus 2008
Figure 1: Telco revenue management chain
Figure 2: Telco revenue growth: 3Q09 versus 2008
Figure 3: Telco EBITDA margins: 3Q09 versus 2008
