tmfc15479 - monetizing bandwidth - wringing maximum value out of network assets.pdf

8/10/2019 TMFC15479 - Monetizing bandwidth - Wringing maximum value out of network assets.pdf

http://slidepdf.com/reader/full/tmfc15479-monetizing-bandwidth-wringing-maximum-value-out-of-network-assetspdf 1/24

OUT OF NETWORK ASSETSWRINGING MAXIMUM VALUE

Sponsored by

QUICK INSIGHTS

2 0 1 1 | w w w . t m f o r u m . o r g

MONETIZINGBANDWIDTH

Free to tmforum members $995 where sold

Report prepared for Rio Puja Laksana of SML Technologies. No unauthorised sh


http://slidepdf.com/reader/full/tmfc15479-monetizing-bandwidth-wringing-maximum-value-out-of-network-assetspdf 2/242 www.tmforum.org

CLOUDSERVICES

QUICK INSIGHT



http://slidepdf.com/reader/full/tmfc15479-monetizing-bandwidth-wringing-maximum-value-out-of-network-assetspdf 3/24 3www.tmforum.org QUICK INSIGHTS

Monetizing bandwidth:

Wringing maximum value out of network assets

©TeleManagement Forum 2011. The entire contents of this publication are protected by copyright. All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, ortransmitted in any form or by any means: electronic, mechanical, photocopying, recording or otherwise, without the prior permission of the publisher, TM Forum. The views and opinions expressed by

independent authors and contributors in this publication are provided in the writers’ personal capacities and are their sole responsibility. Their publication does not imply that they represent the viewsor opinions of TM Forum and must neither be regarded as constituting advice on any matter whatsoever, nor be interpreted as such. The reproduction of advertisements and sponsored features in this

publication does not in any way imply endorsement by TM Forum or of products or services referred to therein. While every effort has been made to ensure that articles, sponsored features, logos andtrademarks appear correctly, TM Forum cannot accept responsibility for any loss or damage caused directly or indirectly by the contents of this publication.

Page 4Executive summary

Page 6 Section 1Methods of monetizing bandwidth

Page 17Section 2

External influences and some conclusions

Page 21Sponsored featureOpenet

Report author:Tony PoulosBSS Evangelist, TM [email protected]

Managing Director, TM ForumInsights Research:Rob [email protected]

Publications Managing Editor:Annie [email protected]

Creative Director:David [email protected]

Commercial Sales Consultant:Mark [email protected]

Publisher:Katy [email protected]

Client Services:Caroline [email protected]

Marketing:Corporate Marketing Director,Lacey Caldwell [email protected]

Report Design:The Page Design Consultancy Ltd

Head of Research and Publications:Rebecca [email protected]

Advisors:Keith Willetts, Chairman and ChiefExecutive Officer, TM Forum

Martin Creaner, President and ChiefOperating Officer, TM Forum

Nik Willetts, Senior Vice Presidentof Communications

Published by:TM Forum240 Headquarters Plaza

East Tower, 10th FloorMorristown, NJ 07960-6628USAwww.tmforum.orgPhone: +1 973-944-5100Fax: +1 973-944-5110

ISBN: 978-0-9838027-0-9




MONETIZINGBANDWIDTH

QUICK INSIGHTS

Analysts agree that broadband, particularly

mobile, is growing exponentially. It is almost

certain that mobile broadband adoption will

eclipse fixed broadband as early as 2011, and

reach more than 2 billion subscribers in the

next four years. Every C-level executive in

the communications industry is acutely aware

that unless broadband can be monetized

to increase revenues and provide return on

network investment, profits will suffer.

The continuing growth in the take-up of

mobile broadband has forced many operators

to invest in more spectrum, upgrade

networks, increase backhaul, establish

new and sometimes onerous peering

arrangements, and deploy greater access

to the Internet. In an attempt to control

traffic levels, they have moved from offering

unlimited plans to capped and tiered models,

but still revenues are not reaching the levels

needed for investment.

Long term evolution (LTE) is moving into its

first full year, and operators are putting tiered

pricing in place on these networks, in part to

reflect the fact data services differ in terms of

usage patterns, traffic and subscriber profiles.Ralph de la Vega, President and CEO, AT&T

Mobility and Consumer Markets states, “If

you didn’t have the networks, you wouldn’t

have the smartphones. If you didn’t have

the smartphones, you wouldn’t need the

applications. When you have all three, a

tsunami of change takes place that makes this

mobile broadband really a game-changer in our

life and in our workplaces.”

In addition, over the top (OTT) players

provide customers directly with applications

and services without the customers of

communications service providers (CSPs)

making any revenue from them or their

transport. Operators need to exploit their

multi-billion dollar investments in networks to

cope with the ‘data tsunami.’

To raise the average revenue per user

(ARPU), operators must move away from

basic subscription revenue, taking the

opportunity to differentiate themselves from

OTT providers and other third party vendors

by deploying intelligent, IP-based network

solutions.

Mobile bandwidth and the spectrum

supporting it are limited resources and CSPs

worldwide are looking at any means at their

disposal to monetize both. They are also

seeking to better monetize the services they

provide and to add new revenue-generating

services to their portfolios. Although this

report tends towards mobile network issues,

many of the options discussed could apply to

fixed broadband.

Telcordia puts it succinctly: “You can do the

math as to what that will mean in terms of

revenue growth. Two billion mobile broadbandusers – and the only reason they will want

to subscribe is that there will be must-have

applications and content to support them.

Somebody is going to supply it for them,

and that somebody is going to get paid

handsomely to do so, but with new business

models.”

The only way for CSPs to effectively

monetize bandwidth is to be able to measure,

monitor and manage network service quality

to maintain their customer base. Accenture

Executive summary




Monetizing bandwithis a balancing act

describes this as a delicate balancing act:

managing network expenditures to keep costs

as low as possible, while also delivering the

customer experiences and service innovations

necessary to increase market share.

In Section 1, this report covers how

bandwidth can be monetized. In Section 2 it

examines the issues surrounding monetization

exercises, including network neutrality.

This Quick Insights report is based on the

executive roundtable session, Monetizing

broadband: Wringing maximum value out

of network investment , which took place at

Management World Americas 2010, held in

Orlando in November. The debate was lively

and wide-ranging, giving rise to many ideas and

opinions, most all of which are outlined here,

“The only way for CSPs to effectively monetize bandwidth is to be able to measure,

monitor and manage network service quality to maintain their customer base.”

as well as opinion and thought collected from

other TM Forum members and public forums.

A survey was carried out with roundtable

attendees before and after the event, and the

results are interspersed throughout. There were

some surprises, and variation in opinions before

and after the event, as the result of the debate.

TM Forum would like to thank all the senior

executives who attended for their time and

insights. In particular, we are grateful to Shira

Levine, directing analyst, Next Gen OSS and

Policy, Infonetics Research, for chairing the

session, and to provocateurs, John Aalbers,

Chief Executive Officer, Volubill and Brian Levy,

telecoms and broadcasting industry expert,

Vice President and Chief Technology Officer,

JRS Business Group, Juniper Networks.




MONETIZINGBANDWIDTH

QUICK INSIGHTS

Exposing assets to third parties

In the attendee surveys carried out before and

after the event, and at the roundtable itself,

exposing assets to third parties was deemed

the most likely way to benefit from monetizing

bandwidth.

Johanne Mayer, director, Alcatel-Lucent, sees

exposing network capabilities and providing

location data on mobile users as valuable

information that non-mobile operators could

not get, especially in real-time. Exposure of

business support systems (BSS) and operations

support systems (OSS) assets controlled by

communications service providers (CSPs) is

becoming increasingly valuable to any third party

provider keen to access it or sell it to end-users,

and something they would be willing to pay for.

Juniper Networks’ Brian Levy felt that the

OSS is basically looking at the network and in

future it will look beyond that to the systems

connected to the network. The definition of

the OSS is changing fundamentally. While in

the CSP’s domain, the operator can control

all its elements, but what happens when the

applications, content and services are being

delivered from outside the network? This will

happen increasingly, as exposure of these

capabilities to third parties is a serious revenue

opportunity for CSPs.

It was generally agreed that the separate

domains of IT and Network with CSPs aremerging and that BSS and OSS are heading that

way, too.

Mary Whatman, founding partner, Parhelion

Global Communications Advisors, says, “I don’t

see a problem, it’s a three-legged architecture

– network, aggregated and customer layers.

The network guys own the operators, but if

the trend is to spend money in other areas, the

network will become antiquated. The network

guys have no control over who uses the

network. Are the apps well designed? If they

Methods of monetizing bandwidth

Section 1

Figure 1-1: Where do you see the most opportunity for generating revenue from bandwidth?

60%

50%

40%

30%

20%

10%

0%

‘ A l l y o u c a n

e a t p

l a n s ’

T i e r e

d o r c a p p e

d p

l a n s

C h a r g

i n g c o n

t e n t p r o v i d e r s

f o r

d e

l i v e r y o v e r t h

e n e

t w o r k

M o n

i t o r i n g a n

d c h a

r g i n g

O T T

a p p s p r o v i d e r s u s i n g t h

e n e

t w o r k

E x p o s i n g a s s e

t s t o t h i r d p a r t i e s ,

e . g .

S D P

, b i l l i n g ,

c u s t o m

e r p r o

fi l e s

C h a r g

i n g p e r

d o w n

l o a d

B u

i l d i n g a p p s

t h a t g e n e r a

t e n e

t w o r k

d a

t a t h a t c a n b

e c h a r g e

d

A d v e r t i s e r - p a

y s m o

d e

l s

O t h e r

“The definition of the OSS is changing fundamentally. While in the

CSP’s domain, the operator can control all its elements, but what

happens when the applications, content and services are being

delivered from outside the network?”




are heavy network-users they should be

controlled somehow. We’ve made the network

dumber by extracting intelligence to a more

common network layer.

“If over the top (OTT) apps aren’t working

properly, the customer calls the operator listed

on the phone. OTT apps are not managed and

don’t have a QoS portion attached to them.

Somebody has to take ownership of the

problem. It’s the network operator spending

billions of dollars building the network that

is being used and abused by others. If they

don’t take ownership of the problem they will

struggle and suffer and ultimately sacrifice their

livelihood.”

Others saw the applications (see page 8) as

starting in the network layer. Service delivery

platforms (SDPs) are becoming more refined and

their capabilities more attractive to third parties.

There was some debate about who owns the

SDP and whether it is an engineering platform

or an IT platform, and that the engineers might

need greater understanding of applications, but

do not have app tools, processes or standards

to gain it.

On the other hand, the IT people might need

to become more like engineers as they head

into the network layers, but will organizational

structure support this new way of working?

Either way, the SDP could provide valuable

capabilities they do not have themselves.Perhaps the most valuable asset to offer is at

the heart of the CSP – the BSS, which handles

charging, billing and collections. Nobody does it

better than CSPs and for any third party to gain

access to the lucrative, pre-paid customer base,

it will have to work hand-in-hand with operators

and share the revenue.

While much is made of the advantages

operators have through their ownership of the

billing relationship, in a session at Management

World 2010, in May in Nice, France, Ovum

Operators needto take ownership

12

10

8

6

4

2

0

Figure 1-2: Please rate the following business drivers for deploying solutions such

as policy management, charging, and subscriber data management

V i d e o o n

d e m a n

d

M o

b i l e b r o a d b a n

d

V

o I P

I P T V

N e

t w o r k

i n f r a s t r u c

t u r e u p g r a

d e s

i . e .

H S P A + , W

i M A X , L T E

A d v a n c e

d s u

b s c r

i b e r

c o n

t r o l c a p a b i l i

t i e s

M o

b i l e a d v e r t i s

i n g

T h i r d p a r t y c o n

t e n

t

O v e r - t h e - a i r p r o v i s i o n

i n g

B r o a d

b a n

d e d g e

r e s o u r c e m a n a g e m

e n

t

B u s i n e s s s e r v i c

e s ,

i . e .

e v e n

t b r o a d c a s

t i n g

Very important

Somewhat important

Neither important or unimportant

Somewhat unimportant

Unimportant

pointed out that software developers were not

interested in operators’ billing systems. The

company carried out a survey of more than 240

application and software developers for themobile environment, and only 3 percent said they

wanted to work with an operator’s billing system.

CSPs will also have to devise reasonable rates

for the services they expose. Early attempts

to corner the content market by demanding

upwards of 60 percent of revenues led content

providers to attempt an OTT methodology of

their own, but they are limited to customers

who either have credit cards or can make

mobile payments. Working closely with CSPs at

reasonable margins would benefit both.




MONETIZINGBANDWIDTH

QUICK INSIGHTS

“CSPs in some countries

have promoted the

development of localized

apps in their home

markets, some with

great success.”

However, it will be a considerable task for

CSPs to gain the confidence of third parties,

and for the CSPs to invest in their systems to

provide them with the necessary access without

jeopardizing their own operations.

Apps

Building apps to generate network data

that can be charged for came second in

both surveys. It could refer to apps sold to

customers for use on their own devices,

and to apps that run on the network and

are accessed by the devices, and even a

combination of both.

CSPs in some countries have promoted the

development of localized apps in their home

markets, some with great success. Others are

backing the GSMA’s Wholesale Applications

Community (WAC) initiative that aims to

create a pool of apps available through mobile

operators. Developers only have to generate

one version of an app to work across all the

operators involved.

Mayer suggested that if CSPs were to create

their own apps in healthcare, for example,

it would mean guaranteed connectivity and

higher priority embedded in the application –

something only they could provide. New types

of services could be driven by these types

of apps that have a quality of service (QoS)

or service level agreement (SLA) componentattached. With 80 million baby boomers in the

U.S. alone (that is people born in the years

immediately after the Second World War), the

healthcare market has huge potential.

The same applies to the enterprise and small

to medium business (SMB) market, which is

gaining an appetite for mobile applications, in

particular, those that require other network

assets (such as cloud services and location)

to be most effective for their geographically

dispersed workforces. Connectivity will be

critical, so applications that manage and

guarantee that connectivity will be key.

In a recent TM Forum webinar, Florian

Michel-Gabriel and Marco D’Aleo from

Accenture raised similar concerns that CSPs

cannot wait for problems that cause outages

or serious service degradation to develop in

their networks. They need to be proactive in

identifying potential problems and be able

to assess quality through the entire service

delivery chain and the distributed network

systems in real-time.

The CSPs that can enable this service

across all network and application domains,

including radio access, backhaul, transport,

core network, and value added services (VAS,

such as network and diagnostics providing

information about performance, quality, and any

apparent faults) will provide value that could

and should be charged for.

Quality of service and experience

Network operators want to have control

across the network and deliver third parties’

services with an end-to-end view of service

management, SLA assurance, Quality of

Experience (QoE) and QoS.

John Aalbers, Volubill, comments, “If

CSPs can guarantee an end-to-end QoS then

there has to be a way that this can lock into

a business model with third party contentproviders. Otherwise, I don’t see any reason

why they would want to open up and share

revenues with CSPs. There has to be a

commensurate value offered and QoS is

something they will never be able to offer on

their own.”

Levy adds; “It’s not just about QoS, it’s

about end-to-end QoE. It’s about distributed

computing. There needs to be some sort of

prioritization and all networks have to work in a

cohesive way – end-to-end. The issue of content




Policy managementis a very hot topic

delivery and the fact that broadcasters are going

global but expect quality delivery supports this

argument. Why not offer them QoS for their

customers and charge them for it?”

Others felt that the perception of QoS varies

from region to region. There were concerns

that the communications industry could keep

spending to improve quality without seeing a

return on that investment as expectations rise.

One delegate says, “CSPs should look more

at bundling services than focusing on one

equation. For the enterprises and SMBs, QoS

definitely comes into play. That’s why they

pay more for their services. Many businesses

would like peering arrangements and direct

access to the Internet. The other angle is that

CSPs can provide IT as service for SMBs and

could partner to do it.”

IT architects see services as requiring a

lot of integration. Underlying standards are

important to achieving this and enabling

complex applications. At the same time, the

services must be managed end-to-end to deal

with QoE issues.

The QoS and QoE discussion was the

longest debated at the roundtable, not just in

its own right, but along with the issues it raises

around net neutrality (see page 17).

Policy management

Policy management across the operation of thenetwork and its associated support systems has

become one of the hottest topics for operators

and suppliers. It can be broken down into usage

management and charging controls.

Usage management balances the demands

on network resources, services and capacity

among growing data consumers, bandwidth-

hungry applications and always-connected

devices. Charging controls charge users

according to quotas, real-time service and

charge acceptance, delivery confirmation

Figure 1-3: Which departments within your organization are responsible for procuringand operating your policy control solutions?

60%

50%

40%

30%

20%

10%

0%

I T o r g a n i z

a t i o n

N e

t w o r k o p e r a

t i o n s

N e

t w o r k e n g

i n e

e r i n g

M a r k

e t i n g

O

t h e r

(event and session- based activity), and

subscription plans. They also enforce QoS-based

applications, such as VoIP.

Aalbers says there are two approaches to

policy management from the suppliers’ point of

view: “In a network request for proposal (RFP),policy management is a box they have to have

in the infrastructure. Another part of the market

comes at it from the marketing or business

perspective saying this policy stuff is a really

powerful tool that, put together with charging

and subscriber data, can be used as a way of

segmenting the market more deeply.”

Accenture believes that CSPs require

advanced solutions in policy management,

enabling greater control over service quality

by dynamically adapting network resources




MONETIZINGBANDWIDTH

QUICK INSIGHTS

to a user’s status and real-time usage. An

effective policy management infrastructure

should control and dynamically adapt network

resources based on application and network

triggers.

Policy management capabilities are being

driven by regulators in different parts of the

world. They are insisting on operators having

better real-time access to subscribers’ usage

data. For example, European regulation

(the so-called Bill Shock Prevention policy)

obligates CSPs to inform roaming subscribers

immediately when their data roaming charges

reach a certain level. Innovative policy

management helps operators comply with such

regulations.

Policy management vendor Openet reckons

that the small, but growing, number of users

who consume most of the network resources

are destroying the economics of unlimited,

high-speed Internet service access. This

means service providers need to find ways to

monetize fast, rich media delivery.

Operators can only achieve maximum

performance and revenue by offering

differentiated services through individual

subscriber’s policies to segment users by

the speed of their data service and/or usage.

Subscribers select the best data package for

their needs and operators make a reasonable

return on their network investments.Better control of bandwidth relates to better

cost controls and enables the CSP to offer

its customers, particularly enterprises, ways

of managing their own staff usage. This is

another example of a VAS that could generate

extra revenues and encourage customers to

be loyal.

Quota management

The concept of per service quota buckets is

that each service (data, video, voice, or peer-

to-peer) can be configured separately on a time

or volume basis. It has been in use for some

time, particularly in the prepaid sector. There

is no reason why it could not be extended and

offered as a VAS to enterprises or individuals,

through enforcing intelligent policy-based rules

once the agreed quota is reached. This would

prevent users running up huge bills, keep

regulators happy, and help operators plan and

manage network capacity.

Quota management underpins tiered data

services, quota-based, and unlimited services

that are pre- or postpaid for voice, data, and

video applications. In some markets where

customers are still charged per kilobyte

downloaded or data plans are not readily

available, content providers buy wholesale

data capacity from a CSP at low prices and

cover the cost of the content transmission to

their customers in the price of a bundle. This

is like an OTT supplier-pays model, but relies

on quota management to track the take-up of

purchased data volumes.

Authentication/security

Levy pointed out that BT, in trying to work out

how to offer VASs, discovered authentication

can be resold. Mobile operators have, at the

very least, knowledge and control of the device

on their network and have in place standard

authentication, authorization, and accounting(AAA) capabilities.

Combining AAA with the security of mobile

networks is also a desirable feature that could

be monetized.

Mobile payments expert David Birch, co-

founder and director of Consult Hyperion,

believes that CSPs could become smart pipes

for financial transactions. This is because

operators can link secure identification to

the SIM, providing private and public keys

for multiple providers. The resultant digital

“Policy management

capabilities are being

driven by regulators in

different parts of the

world.”




The right intelligencecan increase revenue

signatures would allow for ultra-secure, low-

level authentication via the mobile device.

In this instance, revenue is not necessarily

the primary driver so much as reducing churn:

smart pipe operators could give the service

away to key holders so they could offer a

range of secure transaction services to their

customers.

Device management

Mobile service providers can deliver an

intelligent networking experience that allows

subscribers to dynamically activate, select, and

update services and plans in real-time using

over-the-air (OTA) provisioning. Offering this

to third parties, as mentioned above, can be

achieved through security-based applications,

such as a SIM tool box, SIM management and

security.

Managing devices over the network gives

the mobile operator an advantage over its

fixed line counterparts as the device supports

personalized services and content. So the

delivery of targeted content and advertising is

customized by device, network location, and

subscriber profile. This also allows the CSP or

its third party partners to deliver value-added

applications, such as parental and time-of-day

controls, plus video and gaming.

Accenture believes that: “Delivering

consistently high mobile-service quality dependson the ability to determine what customers are

experiencing on their devices in real-time…

consumers are frequently bewildered by the

complexity of devices – a situation that has the

potential to decrease usage and, therefore,

average revenue per user.

“Mobile operators can deliver advanced,

user-centric functionality and support with the

aid of a mobile device-management capability.

This suite of technologies and tools gives

customer service representatives a more

complete view of the user’s experience,

enabling rapid diagnosis and troubleshooting of

device-related problems, and therefore faster

resolution. Tailored support can be provided

where it often matters most – right at the

device, where customers form their most

enduring impressions of a company’s brand

and service.

“An especially innovative aspect of advanced

service monitoring capabilities is a mobile

device quality agent. Imagine software,

installed on customers’ mobile phones, that

effectively turns thousands of mobile devices

into stations capable of monitoring service

performance cost-effectively. The software

on customers’ mobile phones could monitor

service performance and quality, raise alarms if

service quality falls below a pre-set threshold

and also collect data that can be analyzed to

uncover root-cause problems.

“This approach addresses one of the biggest

challenges mobile operators face in delivering

agreed-to service levels to customers: the

fact that carriers can monitor current network

conditions on their end but find it hard to

pinpoint problems that may be degrading the

experience actually produced by the user’s

device. With device-based insight into service

quality, companies can understand what’s

happening and take action.”

Intelligence and analytics

Intelligence about the customer, and

intelligence built into the infrastructure to

guarantee delivery of VAS are both potential

means of creating new revenue

In the first case, CSPs can offer third party

content providers and partners – such as

Google, AdMob, and Yahoo – subscriber profile

information, enabling them to tailor their OTT

service offerings and content to each user.

Customer profiling, tracking customer patterns,




MONETIZINGBANDWIDTH

QUICK INSIGHTS

knowing the most popular websites and what

content and applications are selling could give

the CSP a huge source of revenue. Analytics

then become the key tool for managing this

area (members can download the Insights

Research report Exploiting Analytics: How to

Improve Customers’ Experience free of charge

from our website).

On the infrastructure side, we need more

intelligent operation of core networks to

manage services more effectively. Prioritizing

data is essential. Network neutrality (see

page 17) arguments were established in the

Web 1.0 days, long before we envisaged the

demands of Web 2.0 and high-speed high-

bandwidth access. They were designed to

prevent incumbents from killing new players

like Google. Now the reverse is true; such

players could kill CSPs.

To maximize profit and market share,

mobile service providers need to create a

dynamic, intelligent network that automatically

maximizes bandwidth, manages network

resources effectively, tracks and monetizes

services, and enables a user to customize their

experience in real-time.

Performance management for monitoring

and reporting, and analytics for data services

will become increasingly important. Operators

need to understand better how to tune their

networks and provide more data to subscribersto increase the transparency of services.

Increased sensitivities around net neutrality

may play a big role in stressing the importance

of transparency, depending on future regulation

(which is likely to differ around the world).

Using the intelligent features of these

platforms, mobile operators can integrate

subscriber information with network and

application intelligence, in real-time, to deliver

personalized experiences. Such real-time

session and subscriber-state intelligence is not

available through the cookies in a web browser,

only through the intelligence embedded in an

operator’s mobile Internet core.

This can be used to create next generation

business architectures and new business

models. Operators can benefit from two-sided

business models, creating value for both

providers and consumers while benefiting from

both. With these capabilities in place, mobile

operators can enter new markets, including

machine-to-machine, cloud services, and

targeted advertising.

Location

Service providers are able to deliver location-

based customized content, applications, and

OTT services based on location – otherwise

known as Mobile Location-Based Services

(MLBS). Revenues could come from sales

of MLBS apps through application stores

and other channels, but also from mobile

advertising tied to those apps. In fact, a Juniper

Research report notes that advertising will

likely form an increasing share of MLBS-related

revenues over the next five years.

In the words of Juniper’s principal analyst, Dr.

Windsor Holden, “Location-based applications

are extremely interesting for brands and

retailers in that they allow those companies

to direct consumers to outlets in their vicinity

while simultaneously providing informationabout the products on offer. When these are

allied to measures such as mobile coupons

and vouchers, you have the combination of

information and financial incentive, which can

be compelling for consumers.”

Wikipedia defines (M)LBS as including

services to identify a location of a person or

object, such as discovering the nearest ATM

or the whereabouts of a friend or employee.

(M)LBS include parcel and vehicle tracking.

They can include mobile commerce in the




Standards are vitalfor revenue generation

form of coupons or advertising directed at

customers based on their location. They

include personalized weather services and

even location-based games. They are an

example of the convergence of many elements

into a communications service.

The fact that mobile CSPs can determine and

utilize location information in real-time should

generate far more interest and revenue than

it does. Perhaps the increase of smartphones

and applications containing MLBS information

will drive this revenue stream.

Interoperability standards

The roundtable spent some time on standards,

or the lack of them, that are needed to help

generate revenue from bandwidth provision.

Most agreed on the need for standards and

felt that a number of organizations were

offering standards for pieces of the jigsaw.

One attendee from a software company wants

CSPs to collaborate much more, to manage

their partnerships and to group things together

to add value to the end-user.

Another barrier to deployment is the

integration nightmare – the difficulty of

implementing multi-vendor solutions that

use different standards, interfaces and policy

management systems. The situation becomes

almost impossible when each vendor’s product

requires separate integration with the serviceprovider’s OSS or provisioning environment.

Moreover, the need for multiple elements to

analyze traffic flows introduces latency, which

can affect performance.

Phil Dance, managing director, technology, BT,

says, “TM Forum needs to define the rules and

lobby the industry about prioritization. Content

providers and customers all want quality of

delivery and will not put up with video that is

pixelated or staggered. We need to define what

the levels of priority are and label them so there

is some standardization across the telecoms

industry – so that Priority One, Two or Three

means the same thing to everyone.

“A good example is that if someone dials

the emergency number on a VoIP network

it is recognized and gets priority over all

other traffic, and that healthcare applications

monitoring individuals in remote locations are

not disconnected or access restricted because

of network congestion.

“In talking to leading players in movie

entertainment, the concerns are around

digital rights [DR] and whether the content

being delivered has the necessary DR and that

the customer experience is as good as having

the DVD.”

Levy comments, “Standards are in place

for VoIP, IPTV, and other services but not

implemented the same by all vendors. Getting

hung up on making money from the pipe will

not solve the problem and we must focus on

the services running over the network to make

more money.”

Another delegate adds, “Consumers will be

willing to pay for a better conditioned service

that is differentiated, like gaming and peer-to-

peer. It’s not a matter of technology for CSPs,

just their willingness to experiment. There is

ample technology to implement these business

models, but there is indecision.

“You don’t need standards to cross serviceproviders’ [physical] boundaries, in the same

way, you have to allow exclusive partnerships

to guarantee QoS and encourage the parties

to make the investment. Some innovators will

determine a way to do QoS across borders

and if it’s successful it will likely be adopted

by others and may become a standard in due

course. Standardization is far too early for the

monetization of bandwidth.”

“The fact that mobile

CSPs can determine and

utilize location information

in real-time should

generate far more interest

and revenue than it does.”




MONETIZINGBANDWIDTH

QUICK INSIGHTS

Google Tax

There has been discussion of late around

charging companies such as Google, YouTube,

Netflix, and other OTT entities that generate

massive amounts of traffic without bearing the

cost of transmission. Known as the Google

Tax, it is not that different from interconnect

transit and termination charges for voice on

circuit-switched networks. However, apart from

peering arrangements between major Internet

service providers, IP traffic appears to be

carried at no charge.

Aalbers says, “Operators are in a

disadvantaged position because companies

like YouTube can launch a high-definition

service and suddenly bandwidth consumption

increases dramatically. Is there any obligation,

morally, for YouTube to contribute to that cost?

Or is the obligation with the end-user who

benefits from the higher bandwidth usage?”

An infrastructure charge to application and

content providers is one suggestion to deal

with this situation, maybe on a sliding scale if

they use other services, like billing, provided by

the operators.

Dance points out that BT has become the

wholesaler of choice for many companies

that were previously competitors because its

services allow them to reduce their operating

expenses and cut overheads while still

delivering product.Content and service providers could pay the

mobile operator for quality access and delivery

of locally cached premium content to multiple

screens (see page page 8, Quality of service

and experience). Consumers could also pay

the mobile operator for premium, personal

multimedia services on multiple screens.

Unless CSPs are able to provide something

unique to these players or develop partnerships

that benefit both sides, introducing a Google

Tax will be very difficult.

(This issue is examined in greater detail in

the Quick Insights report Future Shock II: The

age of the user , which is available free to TM

Forum members from our website.)

New sectors add pressure

As the demand for high-definition video and

video-sharing multimedia continues to rise

across the healthcare, security, and retail

marketplaces, networks will be put under

further stress. There is an urgent need to

optimize the transport of high-bandwidth

traffic. New technologies need to be sponsored

and adopted by CSPs.

Healthcare repeatedly comes up as an

example of this new generation of mobile

services that could monitor patients at home,

reduce the need to travel to health centers

and offer remote diagnosis by physicians. We

have already seen operations and medical

procedures being managed over the Internet

as well as diagnoses of X-rays and tests in

real-time by specialists located thousands of

miles away.

Security surveillance, remote monitoring of

utilities’ plant, and personal monitoring of homes

and vehicles with video links are all bandwidth

intensive apps that can generate premium

revenues in return for guaranteed QoS.

Accenture points out that discussions of the

new era of mobile high-speed broadband areusually focused on new network technologies,

innovative services and an ever-expanding

array of devices. However, seeing through

the eyes of the customer is equally important.

Monitoring individual usage and tailoring the

right experience to the right need will be critical

to success, along with the ability to probe the

network and mobile applications to discover

the source of service issues.

Competitive advantage in the high speed

mobile broadband era depends on customer-




Cloud computingraises trust issues

centricity. Across deployment strategies,

network planning, service and support,

communications companies that successfully

drive profitable growth and high performance

will do so by keeping the customer experience

at the forefront.

Cloud computing

One of the most hyped areas being touted for

bandwidth monetization is cloud computing,

in all its permutations – Infrastructure as a

Service (IaaS), Software as a Service (SaaS),

Communications as a Service (CaaS), Platform

as a Service (PaaS), and any other XaaS you

can think of. CSPs see cloud as a natural

extension of what they do already, providing

these services to customers via their own

networks.

Connectivity is the common factor and

guaranteed access can realistically only be

offered by CSPs that control their own network

infrastructure. The bundling of communications

and services, partnering with key software and

equipment vendors, and billing in multiple ways

are all seen as major growth areas.

Dance argues, “We are now dealing with

distributed computers – the last mile is speeding

up, but has been the point of constraint. Once

opened up, the last choke point on the Internet

is removed. As Internet use becomes greater,

the core networks will not be able to cope withthe loads placed on them.”

Another delegate adds, “In China, one of

the most important drivers is the government.

Trying to bolster competition between the

three mobile players by pushing 3G and triple

play, now the traditional telco can get into the

Pay TV industry and the Pay TV players can get

into telco services.

“In this situation operators have pressure

to introduce more VAS to make more use of

their network, to differentiate their service

and to retain their customer base. This is a big

challenge. Most operators in Asia are looking

for growth in revenue from data, they want to

be major players in cloud computing. Building

up trust is the major issue, along with privacy

and security. Still the trend is to buy systems

rather than services.”

It should be noted that the issue of trust is

raised when talking about cloud computing

because data is located remotely, and access

to it at all times is critical. CSPs are generally

regarded as trusted parties and have the

distinct advantage of already having firm,

direct relationships with customers (TM Forum

has published a range of Quick Insights and

Insights Research reports on different aspects

of cloud – members can download them free

from here.)

Bundling, pricing and billing

As CSPs’ focus turns to revenue creation

around data services, moving beyond cost

control from managing traffic, we can expect

to see more experimentation with flexible and

creative data service bundles. Operators could

introduce tiers for video, music or gaming

services instead of pricing plans by the byte.

These appeal to a greater range of customer

segments, increasing retention and offering

personalized service plans.

Some emerging markets are alreadycharging for Internet access as pay-as-you-go

models in blocks of time. In Indonesia, SMS is

charged by the character to make it affordable

to the poorest subscriber. Why pay for 160

characters when you only want to send 10? It

is reminiscent of the way telegraph messages

were paid for more than a century ago.

Operators in Indonesia also offer Facebook

access free to generate loyalty and promote

usage for other Internet services on mobile. It

has been very successful.


http://www.tmforum.org/ResearchPublications/InsightsResearchReports/7138/Home.html

http://www.tmforum.org/ResearchPublications/InsightsResearchReports/7138/Home.html



MONETIZINGBANDWIDTH

QUICK INSIGHTS

Others are experimenting with monetizing

software applications for mobile: a mobile app

acts as a unique transaction unit and estimates

its own bandwidth usage, determining a pricing

model on the fly and deploying the app, based

on the pricing model. The program monitors

the consumer’s usage and adjusts the pricing

model if required.

Dynamic billing rates bandwidth usage at

differing values, depending on network loads

and availability. Users are encouraged, by

SMS, to take advantage of higher tiers or

lower unit charging when the network is not

busy and the reverse when it is busy. This

helps the operator balance loads and reduce

network investment by coping better with

peak traffic loads, which may only occur once

or twice a day for short periods.

Personalizing service plans

Susie Kim Riley, CMO, Tekelec, states, “This

year saw the first moves away from the ‘all

you can eat’ data plans, with many operators

globally introducing capped tariff tiers as

the battle to take charge of the seemingly

insurmountable data surge intensified. The

introduction of Policy and Charging Rules

Function (PCRF) enabled operators to launch

the first tiered services, giving subscribers the

opportunity to pay a premium for faster data

rates and higher data allowances. But whatcould be next for this maturing market?

“Operators will shift their focus to the

subscriber experience, moving beyond

bandwidth to providing the subscriber with the

experience that is tuned for the applications

and services they desire. Instead of only

ensuring the sufficient bandwidth for services,

operators will want to leverage other technology

components that can enrich the experience.

“For example, in the case of a sporting

event video application, location information

can be exploited to ‘localize’ the experience,

as well as potentially provide users with

targeted advertising for retailers close to the

subscriber.”

Due to the range of services accessed

by today’s subscribers, and mobile service

providers needing to keep costs low, it is

important for a network to be as automatic

or self-managing as possible. One way is to

provide users with self-service options to

adjust their own service settings. If subscribers

need to quickly increase their bandwidth

access, for instance, a ‘turbo boost’ feature is a

real advantage and a great revenue opportunity

for service providers.

Other popular features include parental or

time-of-day controls and fair use bandwidth

management. Allowing subscribers to design

and manage their own service plans will be a

leap of faith for many CSPs, not only because

of the limits of legacy systems, but because

they fear they will not be able to control them.

“Allowing subscribers to design and

manage their own service plans will be

a leap of faith for many CSPs.”




The net(work) neutralitydebate rages on

External influences and some conclusions

Section 2

We must recognize outside pressures

that could have a negative impact on

communications service providers’ (CSPs’)

ability and need to monetize bandwidth.

These arguments will need to addressed and

responded to if the regulators are going to take

into account the needs of the industry and not

just those of the most vocal.

Monetizing bandwidth is critical for the

survival of the communications industry;

without sufficient income to invest in greater

capacity, faster networks, it cannot prosper.

Yet there is huge opposition to moving away

from the principle on which the Internet as a

mass medium developed, that it takes in data

packets at one end and does its best to deliver

them to their destinations regardless of content

– also known as network neutrality (NN).

NN arouses strong feelings on all sides, with

different people having very definite ideas

about what neutrality is, how important it is,

and its implications. The argument around NN

is a clash of ideologies, cultures, and deeply

held principles. Those in favor of NN argue that

allowing different charging mechanisms for

different levels of service will kill the innovation

that allowed the Internet to be such a powerful

and disruptive force.

In a paper entitled, How Industry Intends

To Kill The Internet As We Know It , by Jeff

Chester, Executive Director, Center for DigitalDemocracy, this is explained briefly and well.

He writes: “The Internet’s promise as a new

medium – where text, audio, video and data

can be freely exchanged – is under attack

by the corporations that control the public’s

access to the ‘Net, as they see opportunities

to monitor and charge for the content people

seek and send. The industry’s vision is the

online equivalent of seizing the taxpayer-owned

airways, as radio and television conglomerates

did over the course of the 20th century.

“These goals and objectives are visible

to anyone who cares to look at the arcane

world of telecommunications policy and

planning, either in the industry trade press or

government documents. The bottom line is the

industry wants to kill the Internet as we know it.

“The consequences are cultural and will

affect the pace and character of progress in

the early 21st century. If the communications

companies impose tolls, roadblocks and dead

ends on the information ‘superhighway,’ they

will be robbing public trust resources in much

the same way 19th-century mining companies

pilfered public lands, and 20th-century radio

and television networks privatized the public’s

airwaves.”

Yet something will have to give. In Section 1,

we looked briefly at some largely interrelated

ways that CSPs could monetize bandwidth,

from exposing network assets to policy

and quota management, authentication and

security, device management, the use of

location data, interoperability standards, a

Google Tax, new services with guaranteed

Quality of Service (QoS) embedded in them,

bundling, pricing and billing, and personalizing

service plans. So there is no shortage of ideas,

technologies, opportunities and new business

models.

Almost every discussion at the roundtable

that includes some type of traffic, policy,bandwidth management or conditioning

gives rise to concerns about NN and the

expectation that regulators, led by the U.S.,

will perhaps stop anything that affects equal,

unencumbered access to the Internet.

However, it would seem this is not

entirely the case. In December 2010, the

U.S. regulator, the Federal Communications

Commission (FCC) published its rules on NN*.

The report states that the Internet is a level

playing field. Consumers can make their own*The full report can be found at:

http://www.fcc.gov/




MONETIZINGBANDWIDTH

QUICK INSIGHTS

choices about what applications and services to

use and are free to decide what content they

want to access, create, or share with others.

This openness promotes competition.

It also enables a self-reinforcing cycle of

investment and innovation in which new uses

of the network lead to increased adoption

of broadband, which drives investment and

improvements in the network itself. This in turn

leads to further innovative uses of the network

and more investment in content, applications,

services, and devices.

Crucially, there were, however, concessions

made to wireless operators that, as Julius

Genachowski, chairman, FCC, points out, have

“unique technical issues involving spectrum

and mobile networks, the stage and rate of

innovation in mobile broadband; and market

structure.”

This, as was widely expected, has left

the door open to price mobile broadband

services in ways that will differ from wireline.

However, cable, fixed and wireless operators

are subject to a ‘no blocking’ rule which affects

lawful content and applications. They are also

prevented from disallowing services like Google

Voice that compete with their own offerings.

CSPs must disclose information to

consumers about network management

practices and performance under the

regulation’s transparency requirement.‘Reasonable network management’ is defined

as ‘appropriate and tailored to achieving a

legitimate network management purpose’

such as ensuring network security and

integrity, addressing harmful network traffic,

and mitigating network congestion. The

interpretations of this are likely to be debated

endlessly in court.

The key elements are to preserve the

Internet’s transparency, prevent blocking

of access to ‘lawful’ websites, and prevent

unreasonable discrimination in the transmission

of ‘lawful’ network traffic.

Yet, as the much respected technology

correspondent on the British newspaper,

The Guardian, wrote,“[the proposed rules]

seem to allow mobile carriers to decide that

they can introduce pay-per-service charges,

so that Skype or YouTube or Facebook might

be charged to get their content on to the

networks; alternatively (or perhaps additionally),

users who wanted those services might

find themselves being charged extra. That,

obviously, means that those services are not

being treated in a ‘neutral’ way. Which means

that you don’t have net neutrality.”

Also, while in developed economies at

least, most of us access the web via fixed-

line broadband most of the time, this will not

be the case in future and nor will it ever be in

developing economies.

While the suggestion is that NN rules will be

stricter on fixed line in the U.S., for the time

being at least, this is not likely to be the case

elsewhere. Juniper Networks’ Levy notes,

“There has been recent debate in the U.K.

about allowing traffic management, as opposed

to NN recommendations to U.K. Government.

It is deemed to be in the public good that a

radio service or IPTV is delivered uninterrupted.

The negative argument was that it would mean

restricting other traffic types, which wouldneed regulating. The question is, ‘Should CSPs

have the right to provide differential levels of

quality?’.”

In addition, the U.K.’s Minister for

Communication, Culture and the Creative

Industries, Ed Vaizey, hinted in the fall of 2010

that the government’s expected ruling on NN,

would support light regulation and allow

Internet service providers to charge content

providers for priority access. This seems to be

happening.




Who pays forQuality of Service?

As this report went to press at the beginning

of 2011, there was an angry debate underway

in the U.K. about BT Wholesale’s plans to offer

a new service, Content Connect, to ISPs, such

as Virgin Media, TalkTalk and Sky, in the spring.

The idea is that the ISPs could offer content

providers such as the BBC’s iPlayer or Google’s

YouTube the option of paying for faster delivery

of their content to consumers.

BT and the BBC have already been fighting

about the amount of bandwidth consumed by

its highly popular, free iPlayer streaming service.

In November, the BBC said it would introduce a

traffic light system on iPlayer so that users could

see if their ISP was slowing down delivery by

giving priority to other traffic. BT has denied it is

paving the way to a two-tier Internet.

The discussion around NN in the roundtable

indicates the complexity of the issue and

how differently people approach it. Aalbers

of Volubill raises the theory of Reasonable

Network Management (RNM) in the NN

discussions. He argues, “QoS needs to be

seen positively. Rather than stating if you use

too much bandwidth you will be throttled,

instead say, ‘This is what you can expect at

this package level but if you wish to pay extra

we can guarantee a better QoS’. RNM will be

ambiguous until there is a test case.”

Levine from Infonetics Research asks, “Who

pays for it, and who will get it past the courts?”

while Levy states, “The regulator is preventing

operators from taking control of their networks.”

Levine adds, “How much is this a North

American versus European issue and is this

holding back the TM Forum? It is widely

accepted that prioritization is already there,

voice traffic cannot be treated the same as

data. It’s a matter of perception.”

Dance of BT, enquires, “Who should pay

for QoS, should it be the end-user or the edge

provider? Reading the FCC line with regards

to the end-user, it is pretty unclear. You can

make the case that there are a number of

service applications end-users would be happy

to pay for. A lot of subscribers would jump at

an offer from AT&T for $10 per month to get

guaranteed quality for movie downloads, for

example. The FCC would tell users that’s no

good even if they want it!”

Paul Feldman, a US attorney at Fletcher,

Heald & Hildreth with a close working

knowledge of NN discussions says, “You’ve

raised another issue, that of managed

services. There was a proposal that the FCC

came out with in 2009 under which some

managed services would be exempted from

network neutrality requirements…some of the

exemptions were actually remote healthcare

and public safety.

“What has been interesting is that the

debate was so captured by the advocates of

“The discussion around NN in the roundtable indicates the complexity of the issue

and how differently people approach it.”




MONETIZINGBANDWIDTH

QUICK INSIGHTS

a pure net neutrality that there should be no

prioritization at all, that even these exemptions

are now in question. One thing that comes

out of this is, have members of the TM Forum

been as active on this issue as they could

have been?”

TM Forum’s Advisory Council had met earlier

and voted overwhelmingly that it did not want

to engage in the NN argument, with 18 out of

20 against involvement.

Dance feels that, “We have to try and

get with the regulators, not to argue but to

explain in a logical and scientific manner the

repercussions of having no controls on data

usage over networks and the fear that it could

all come to a screeching halt. It’s the law of

physics. To ignore it is a dangerous thing.”

Aalbers asks, “Is it more about what you are

allowed to sell one group over another in terms

of differentiation?”

Levy says, “There is a lot of pressure on

operators to offer premium service but is that

in the public’s interest? If it doesn’t happen

we will be in real trouble. Investment in

transmission will be minimized because of the

economics of that type of investment.”

Whatman of Parhelion Global

Communications Advisors, asks, “So what

happens when QoS across the network is

equal but it’s all poor? Is that acceptable? The

tragedy of the commons equals Internet miseryfor all. At that point it will be too late. If I am

an operator getting better return in developing

software and apps than upgrading networks

why would I bother and what board would not

support that approach? If it comes to that and

the network starts to falter, wouldn’t the same

operators simply turn to government and say

‘it’s your problem now’ and hand them the

network to manage?”

Whatever the outcomes – and this debate is

going to run and run all around the world – NN

legislation/regulation will likely have a profound

effect on a CSP’s ability to generate revenues

by offering services reliant on different QoS

levels, policy management or traffic shaping.

Now is the time they should be lobbying

legislators in each market.

“There is alot of pressure on operators

to offer premium service, but is that in

the public interest? If it doesn’t happen,

we will be in real trouble.”




Frameworx is developed collaborativelyby TM Forum’s online community



http://slidepdf.com/reader/full/tmfc15479-monetizing-bandwidth-wringing-maximum-value-out-of-network-assetspdf 22/2422 www.tmforum.orgQUICK INSIGHTS

With the current demand for broadband,

operators are compelled to maintain a

delicate equilibrium between competitively

priced customer offerings to grow market

share, and manage the network costs of

surging data traffic to maintain profitability.

Policy management’s ability to

dynamically control and manage the

subscriber experience and network

resources has emerged as an enabler

of service differentiation and a source of

incremental revenue. In addition, it provides

a means to better allocate network capacity,

and manage the capital expenditure

associated with the growth in mobile data.

The power of policy management

One of the most popular applications of

policy management is fair usage, where

it is used to create service plans with

associated data usage caps. However,

operators are rapidly evolving their use of

policy management from this application to

address a whole range of opportunities and

challenges associated with the growth in

data subscribers and traffic (see Figure 1).

A recent survey on the policy

management market by analyst firm

Heavy Reading discussed how operators

are looking to policy management to

deliver richer features and new solutions

by holistically configuring and combining

various parameters (Figure 2) to create and

improve data business models to offer a

differentiated customer experience and to

efficiently assign limited network resources.

The intrinsic flexibility of a rules-based

policy management system, with its

capability to dynamically execute service-,

session-, and subscriber-aware rules

provides operators with a very robust

data traffic management and subscriber

personalization capability.

Creative pricing and packaging of

mobile data

With smarter devices and new applications

driving consumer demand for Internet

connectivity, operators that can rise above

confusing cost per MB and volume quota

pricing strategies will be in a position to win

big in the marketplace.

There are huge differences in the

amount of data and bandwidth subscribers

consume even for customers using similar

devices. Policy management enables

operators to adopt a more sophisticated

and segmented approach to selling data

access to meet the needs of both high

ARPU users and the particular needs of low

ARPU, or nomadic users.

Policy management enables operators

to make data plan improvements by

flexibly configuring data plans that

combine a variety of options made up of

bandwidth speed, data allowance, device

type, duration, time-of-day rules, or the

exclusion of specified applications into

appealing market offerings.

To prevent the commoditization trap,

future revenue growth and profits from

data access will be greatly influenced

by how operators package and sell

their data plans to address the different

needs of distinct market segments.

Policy management provides operators

with a way to enhance their existing

business models by giving operators the

flexibility to craft innovative plans to create

opportunities for revenue growth.

A differentiated subscriber experience

Mobile operators are central to subscribers

Internet experiences as more and more

users become accustomed to and

comfortable with using mobile data

services. This applies equally to users with

high data use and high dollar plans, as well

as new users with less data usage and

simpler contracts. Putting the capabilities in

place to enhance the customer experience

for all subscribers enables new revenue

and differentiation opportunities.

Policy-based controls such as parental

and content controls, bill shock and

roaming controls, URL filtering, customer

notifications, subscriber defined time of

day restrictions, and quality of service can

all be part of the managed personalized

subscriber experience. These provide

opportunities for operators to add value to

differentiate their services by improving the

user’s service experience.When dynamic policy management

controls are combined with charging

capabilities, the concept of personalization is

further expanded to add in how subscribers

can pay for their services. These controls

make it possible to make intelligent, real-

time decisions based on whether the user

has enough credit to make a payment, if

they need to buy a service pass or bundle,

have an inclusive data plan, whether they

are in a Wi-Fi hotspot or are roaming. With

SPONSORED FEATURE

Make your own ruleswith Policy Management

Figure 1: Top six drivers for policy management

Source: Heavy Reading, Next Generation Policy Management Study Findings, July 2010

Enable us to apply “fair use” management techniques to better handle network congestion

Improve quality and depth of network traffic and applications reporting and analysis

Enable us to offer tiered or customized services to different classes or individual customers

Improve quality and reliability of our own key services (e.g. video services or VOIP)

Improve our ability to meter and charge customers for service features & attributes

Enable us to understand subscriber behavior and create subscriber profiles

2.5 2.7 2.9 3.1 3.3 3.5 3.7 3.9 4.1 4.3




this information, operators are empowered

to provide an integrated, interactive and

highly personalized service experience to

customers.

Better congestion management

After years of operators being forced to

compete for customers on price, there are

signs that smartphone users care more

about network quality than tariffs, giving

operators the opportunity to gain back

some pricing power. Paradoxically however,

as more usage and more demands are

placed on network bandwidth, for many

operators service is becoming progressively

more uneven, networks are becoming

overloaded, and capacity is being crunched.

Operators in search of more efficient

bit delivery are enlisting intelligent policy

and network management controls to

keep on growing their data revenues

profitably. Policy management can be used

to align data plans with subscriber usage

to influence subscriber behavior to lessen

pressure during peak congestion periods

and where required manage bandwidth-

intensive applications and services during

periods of network strain.

Policy management also allows

carriers to become more congestion

and application specific in how they

manage the stream of data traffic on

their networks, implementing dynamic,

real-time subscriber management controls

to enhance the wireless experience andreduce congestion in the network.

The power mix: policy controls with

charging

Making policy decisions based on data

usage alone lacks a lot of important context.

Powerful policy controls, when combined

with real-time charging capabilities, enable

fresh thinking on monetization. Including

information about pricing, subscriber usage

limits, and balances makes it possible

for operators to respond dynamically to

opportunities presented by changes in

subscriber or network state or activity, with

relevant offers and information.

Combining policy with charging makes it

possible for operators to enforce a spending

limit, or make an offer or a promotion to up-

sell and cross-sell services, e.g. to renew adata allowance, purchase a roaming bundle,

or request a bandwidth boost.

As service delivery becomes more

complex, with a multitude of choices and

options, marketers need to be able to

simplify customer interactions, ensure a

better customer experience, and present

relevant clear offers.

Policy controls combined with charging

simplify the user experience, making it

possible to make contextual relevant offers

that promote services and information in a

convenient and timely fashion.

Conclusion

Rapid data traffic growth is forecasted to

accelerate with new smart devices, mobile

dongles, and the growing popularity of

video and social networking. Even though

network evolution brings higher capacity

with new technologies such as HSPA+

and LTE, radio resources will always be

finite and building networks to sustain high

quality for all subscribers will be costly.

With policy controls, operators can

alleviate the pressure on network

resources by enforcing subscriber and

application aware policies to reduce theneed for network overbuilds. But more

crucially, these controls provide the

means to innovate. In a rapidly evolving

market for data access, policy controls

give operators much needed flexibility

to quickly respond to competitor tactics,

new devices, applications, and changing

consumer data habits.

Download resources, and learn more:

www.openet.com

Figure 2: Top triggers for policy decisions

Source: Heavy Reading, Next Generation Policy Management Study Findings, July 2010

“Making policy decisions

based on data usage alone

lacks a lot of important

context.”

Volume of data

Application type

Time (e.g. Minutes of use)

Protocol

Time of day

Location

0 20 40 60 80 100 120 140 160

Weighted score where “most important” = 4, 2nd most important = 3,

3rd most important = 2, 4th most important = 1; top 5 only



http://slidepdf.com/reader/full/tmfc15479-monetizing-bandwidth-wringing-maximum-value-out-of-network-assetspdf 24/24

Benchmarking

Training

Standards

Certification

Frameworx

Awards

Publications

Collaboration Community

RevenueManagement

Catalyst

WebinarsConferences

Research

EVERYTHING YOU NEEDTO SUCCEED IN THE WORLD OF DIGITAL SERVICES

BestPractices

ThoughtLeadership

Report prepared for Rio Puja Laksana of SML Technologies. No unauthorised sha

tmfc15479 - monetizing bandwidth - wringing maximum value out of network assets.pdf

Documents