Customer centricity applies to more than just retail customers now that operators have to lure and maintain a growing number of hard-to-please content providers, whose loyalties are linked to the ease with which they can do business and the revenue they generate partnering with different players.
In emerging countries like China and India, it is the telecom operators that are among the fastest growing companies - a trend that can continue if they are diligent and smart in how they manage their key partnerships as content grows in importance.
The growing number of content developers, aggregators, apps store owners, sponsors, advertisers, and even other operators, means the days of using Excel spreadsheets and manual processes to manage partner settlement and content management are coming to an end.
Operators in the next 12 to 18 months will be dealing with hundreds and even thousands of partners - each of which will be incentivized daily by a growing number of "suitors" promising better revenue shares, sophisticated discounting schemes and specialized rating. With each of their partnerships, operators will have to accommodate what can be literally millions of events per settlement cycle.
Operators can either become overwhelmed and fail to deliver the type of experience subscribers want, or they can strive to become "enablers" in the much-touted two-sided business model, where operators provide the types of information and services other stakeholders cannot - using partnerships to appeal to the masses, or to niches deep in the long tail.
According to Tata Consulting Services' Shanky Viswanathan, who heads telecom services, there are two main categories of content into which operators can compete: emerging retail apps (iPhone, Google apps) and more mature content (movies and movie trailers, songs, sports clippings, adult content). Depending on how much revenue operators want to generate and how much they want to control in terms of brand and customer experience, Viswanathan sees several into which service providers will play.
"In strata 1 operators are the backbone, spectrum and bandwidth, as well as working to monetize voice and data for customers," says Viswanathan.
"In strata 2, operators act as content aggregators, using their brands to market the content of partners." Here, he notes, there are more challenges in terms of "owning" the customer assurance and customer experience. "In strata 3, operators have a futuristic view of content and monetize the most out of the content backbone. They buy content from major studios or labels and other providers. They host and manage the content through DRM and DAM (digital asset management) solutions, and they leverage the full-quad play services backbone to disseminate content through multiple end-user touch points. They can price the content, influence the service assurance and customer experience and have a clear cut into the major revenue streams."
As operators consider where they will fit, they must consider what capabilities they have technologically to handle their different roles. Many operators start off working with aggregators that handle much of the relationships, meaning the operators get a smaller amount of revenue, and have less control over brand and the customer experience. For those planning to form more direct relationships with content partners, and therefore with their customers, there must be momentum away from manual processes and spreadsheets and toward automated, unified suites that manage the entire lifecycle.
Even operators with experience managing wholesale relationships, interconnect arrangements and real-time convergent charging and billing for interconnect and content partners are in for enormous challenges when they see the degree to which they must scale, and the rate at which they must keep up with content creation and consumption in a wholesale role.
"Unprecedented automation and flexibility is necessary as content will require increasingly complex discounting and rating, tiered rating, and complicated revenue settlement algorithms to accommodate whatever marketing dreams up in terms of business rules, pricing, charging and revenue shares," warns Siobhan Ryley, product marketing manager at Intec, a company focusing on what it has coined "partner relationship management". "Content brings with it characteristics, volumes and intricacies not present, or at least not prevalent, in the voice-only world."
While carriers and their vendors are familiar with interconnect, billing and settlement on the retail side, multi-party settlement on the wholesale side, along with different price plans and charging, often lead to a lot of customization of in-house solutions or ad-hoc extensions to existing systems. But as content partners seek the path of least resistance and of highest reward, operators will not have the luxury of continuing to customize for each partner in a one-off fashion. Rather, operators will have to provide content partners information in as automated and efficient a manner as possible. That will necessitate solutions specifically designed for the purpose of content.
"Most service providers have systems for interconnect billing, but these systems will fail if they are simply extended to accommodate content, as it's not a single relationship with lots of depth but rather literally thousands of partners - each with its own contracts and variations of how and when to pay and what can be disputed and what cannot be disputed," explains Anandan Jayarman, chief strategy and product officer of Connectiva. The company has helped carriers like Zain, Bharti and Telefonica to collect data from IN prepaid switches, billing and CRM to create visibility into what subscribers are consuming and what the most-consumed and profitable apps and content are.
"We found that about 80% of the information operators collect for revenue assurance purposes can be used to monitor the mobile experience in consuming content and apps; they just have to figure out how to make the most of it," said Jayarman.
What operators have is a treasure trove of information about subscribers, which can be useful to not only themselves, but also to partners that would covet and pay for "marketing services" with which they can know more about what apps or content were most attractive. "This is the sweet spot for operators, which can possibly monetize the data they have readily at their fingertips about demographics, user preferences, locations and usage habits."
Abstracted out in ways that protect individuals' privacy, this type of information can be offered in the form of analytics and reports. No one else - not Apple, Google, Yahoo, Microsoft - has the type of information operators possess.
"If you can show a partner how in the first two weeks of launching a game, females of a median age of 21-30 were the most prevalent users, there can be more opportunity to refine marketing; that is incredibly valuable to content providers. That is the future direction," says Ryley.
Agreeing with that sentiment is Anat Ben-Yaccov, product marketing manager with Amdocs, who believes that partner relationship management and self care will be important to content partners evaluating which operators to partner with.
"Operators looking to monetize their network infrastructure will have to make sure their solutions provide for advertising services through analytics, revenue projection tools and analysis of margins and revenue potential," says Ben-Yaccov.
Because marketing information is so desirable, operators will have to walk a fine line between protecting customer data and doing what they can to be user friendly and "accessible" to content partners. These needs must be balanced with their need to maintain control, and perhaps even the "upper hand" in times when contracts are being negotiated or when disputes are being settled with partners.
To maintain control, operators will most likely seek "wholesale suites" that should cover an array of responsibilities. These suites will comprise things like wholesale billing, interconnect settlement, partner relationship management and roaming, trading and routing, as well as partner self-care and marketing services.
"Indeed, operators will be racing to automate the end-to-end life cycle, from inception of a contract to settlement, and through to customer service and dispute resolution," said Suvradeep Bhattacharjee, a senior analyst at Ovum. He admits that right now, it's a "virtual minefield," with telcos on shaky ground as they try to figure out monetization and how to close the huge gap between content usage and revenues.
"The whole of content settlement and billing is in its infancy, with operators doing things ad hoc and in a customized fashion because of inexperience with the volumes and complexity of third-party and multi-party settlements. They really need automated solutions," he said.
The perfect partner
What to look for in unified content settlement/partner management solutions:
- The ability to manage payments from thousands of partners. This requires the flexibility to handle multi-currency requirements, hybrid models and subscriptions, ever-changing refunds and discounting models.
- Content partner self care, which translates into not only better customer service for partners, but cost savings and efficiencies for operators. Much of the responsibilities traditionally put on the operators can be shifted to content partners by allowing them to upload content through self-care portals. Allowing them to track financial agreements and contracts, as well as launch queries or disputes also will cut costs.
- Analytics and marketing reports that offer projections and margin analysis can create opportunities for monetizing data operators already have in their systems.
Siobhan Ryley, Intec