Bringing TCO down
The global financial crisis continues to threaten business fundamentals. Credit availability and cash flows are tightening and companies are looking for fresh ideas on how to eliminate inefficiencies and save money. While the telecom industry is believed to be recession-resistant, it is not recession proof. So, how can operators drive down the cost per transaction flowing through their network to save money? Consolidating systems on both the software and hardware layers is one fresh idea to be considered.
Within the billing and charging domain, there's no need to continue running billing and online charging systems on large servers that cost many millions of dollars. These solutions are often architected to only run on a single, large server and if significant high availability is required (99.999% uptime) then they typically require doubling of the hardware. One big expensive server just sits there idle as a failover or "hot standby" server.
Shift to online
Hardware costs can be reduced up to 50 times by simply implementing an online charging solution that can be scaled horizontally across several smaller, more cost-effective hardware servers. The system can be sized to handle the expected load and then a limited number of additional small servers can be added to provide the redundancy required for high availability. Leading-edge distributed software architectures for charging and billing enable such a dramatic cost savings in hardware.
But do not just stop by just consolidating the hardware. Software maintenance costs can be cut by a third or even in half by consolidating the billing, prepaid and postpaid, and partner management systems. Running these separate systems restricts the flexibility operators have to quickly implement new services, promotions, and price plans. It is also inefficient and expensive since it means two or three times the software maintenance costs and the need to maintain staff with expertise in each individual system.
TCO and operational costs can be reduced by migrating all of these systems to a single platform. There are additional benefits to having fully-interlinked models for customer pricing and partner contracts all in a single solution: it leads to improved margin management with up to the minute insight into margins and cash flow, enables hybrid prepaid and postpaid plans to grow customer loyalty and increase ARPU, and allows rapid tailoring of contracts to ensure win-win partner agreements.
Rather than succumbing to the crisis, operators can benefit by eliminating overspending and inefficiencies in their network and roll that money into investments that can lead to innovative features and value added services at a lower cost. History has proven that those who find the resources to invest in innovation while in the midst of a downturn come out stronger.
Fergus O'Reilly is CTO at Highdeal