Operators face losing nearly one-quarter of revenues – nearly $300 billion – to a combination of fraud and billing error by 2016, according to a new report by Juniper Research.
However, implementation of revenue assurance and fraud management solutions will enable operators to reduce potential global leakage by more than $250 billion by that time.
The report found that as the level of billable events has increased – operator-billed revenues totaled more than $900 billion last year – networks experienced an upsurge in leakage across the revenue cycle from sales to network configuration, rating, and billing.
While such leakages are often the result of system error, networks are also experiencing a sharp rise in fraudulent activity.
According to the report, revenue leakage levels are currently highest in Africa and Middle East, where there are particularly high rates of interconnect bypass fraud (under which fraudsters avoid paying call termination fees) and SIM cloning.
By consolidating and automating its operational processes, the operator can establish 360-degree visibility of the complete revenue chain in order to detect hidden losses or fraudulent activity rapidly. Operators also need a combination of real time analytics and proactive business intelligence.
The report also found that, given that both revenue assurance and fraud management use the same data, operators can and should deploy a single technology platform that enables both sets of operations. Also, the lack of cross-departmental collaboration and information-sharing remains a hurdle to reducing leakage.