Where's the OSS/BSS hype?
Bankruptcy. Killer app. iPhone-killer. There's a sector the wireless industry retreats to from time to time to get away from the noise surrounding shaky MVNO business models, hair-schemed mobile content applications or the latest handset with an iPhone-like feel: OSS/BSS. That's right, you won't find too many buzz words when it comes to billing and customer management. Few trade journalists are racing to break the latest OSS/BSS announcement from the vendors. But without a robust OSS/BSS as a support, there would be no killer apps or iPhone-killers.
The deal that rocked the billing industry this week was Ericsson's $417 million acquisition of LHS. The German company specializes in post-paid billing and CRM solutions. Covergent billing is becoming increasingly important for Ericsson, as it pushes further into an IMS-mentality and carriers begin to roll out their first IMS applications. The acquisition will help Ericsson facilitate even simpler billing scenarios like having one bill for the family that pays for both pre- and post-paid services. LHS will enable Ericsson to do just that by filling in the holes of its new parent company's post-paid billing portfolio.
To capitalize fully on the convergence trend, "Ericsson is looking to pull more services in-house," according to Current Analysis analyst Peter Jarich. "Ericsson is known as a wireless heavy weight," but the telecom industry "is also interested in new services like IPTV, [fixed-mobile convergence], triple plays or other IMS applications." There's a lot of complex billing stuff going on with these types of services, so building out that side of its portfolio is important to Ericsson right now, Jarich said.
Last year, LHS generated net income of about $10.3 million from revenues of $97 million and expects to make between $116 million and $120 million this year. The company has about 550 employees and already counts HP, IBM, LogicaCMG, Nokia Siemens, Sun Microsystems and others as partners. The combined billing offerings of Ericsson and LHS will compete with Amdocs, Comverse, Convergys, Intec, Oracle and others.
At the next telecom tradeshow, you will inevitably notice the lone booth look-out from one of these billing companies. True, their demo probably won't include some new-fangled application, palm-tickling handset or flashy star-studded ad campaign. But rest assured, they'll be there. Ready to support the next big trend. Be it iPhone or MVNO. -Brian