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Bill shock makes 90% Indians switch off data connection

Mr. Morten Brøgger
Global CEO, MACH
  TT Correspondent |  | 22/09/2011

Mobile operators today have a distinct opportunity to take data roaming into the mainstream and generate significant revenues, especially with the onset of 3G. In an interview with Telecomtiger, Morten Brøgger discussed how MACH’s offerings support 3G revenue growth and benefit operators Excerpts: 


 Q: How would onset of 3G impact data roaming?


A: With 3G, there is huge potential to take data roaming into the mainstream and generate significant additional revenue for operators. For example, right now 76% of consumer users in India do not use their phone at all when roaming internationally – not even to send an SMS!  More than 90% of Indian subscribers switch off their data connection while roaming internationally because of the fear of bill-shock. And in some operators, only 5% of the data roamers consume 90% of the data. Consider that an average subscriber today uses 300 times more data when on their home mobile connection than when they are roaming. 


New services are available to mobile operators with 3G, such as the MACH Rerating, Retail Roaming and Data Roaming Engine Solutions. These types of solutions enable operators to offer bespoke tariffs based on the usage patterns of their subscribers or on the type of device a business wishes its employees to use abroad – such as a tablet – while also offering them a greater transparency of cost.       


Q: How would MACH’s RMA solution benefits operators?


A: MACH’s Roaming Margin Analysis solution is the industry’s first automated solution that allows mobile operators to quickly compare their wholesale roaming inter-operator tariffs (IOTs) with interconnect termination rates. It helps operators ensure that roaming traffic is not terminated at rates that are below interconnection cost. It gives operators a clear picture of the true wholesale margins they are making on international roaming, enabling them to optimise their volume commitments and hence, their roaming business operations.


Q : How would you help operators control and improve the operational efficiency of their interconnect businesses by improving the quality of the rating?


A: Mobile operators can and do outsource their interconnect billing and wholesale partner content settlement functions to MACH while still retaining full commercial control.  MACH focuses on functions such as partner management and CDR processing, rating, reporting and settlement, while the operator focuses on the commercial negotiations with their interconnect and content partners, to make sure that they have the best commercial agreements. By doing this, operators reduce their CAPEX overheads and their main cost then becomes an OPEX one  – relating to the number of transactions and agreements maintained. This results in a very low Total Cost of Ownership for an interconnect billing and partner management system, one that does away with the need for licenses or maintenance and hardware fees.


Q: How would DRE help operators launch packages tailored exactly to the roaming needs of the end user?


A: Using MACH’s DRE, operators can define data packages to fit any application and rate the services differently according to the end user group the operator is targeting. They can offer users the services they want to use while abroad: for the holidaying consumer there could be Facebook-only access, while the small business user could opt for Email-only access.


It allows operators to offer services highly tailored to the needs of their subscribers, driving uptake while reducing the final cost to the end user and empowering them to select the services they want to use abroad.  Plus, the DRE is standard-agnostic and can be used for pre-paid accounts, opening up new markets for operators.


Q: What kind of innovative and transparent pricing policies would you suggest for end users by the operators?


A: There is increasing confusion over data roaming charges - users have little understanding of what constitutes a ‘megabyte’. This is leading to a demand for more transparent, service-based charging packages which are tailored to match subscribers’ individual needs. In practice, this could see business users, for example, have an email-only package which would give them access to their inbox at an economy rate, with additional services such as web surfing carrying a higher cost.


In the enterprise sector, if an operator is able to understand which groups of individuals within a business travel the most, where their trips are to and from, as well as the type and amount of data they consume, they will be able to offer a highly tailored retail roaming data package for that group based on their specific needs.  In a company which has senior managers regularly travelling between Delhi and New York or London, for instance, the operator could offer a tailored voice and data package that includes special rates and usage incentives to cover the time spent abroad.


This type of micro-segmentation would seem to be a key tool in removing the fear of bill-shock. If a subscriber is given the choice when they land at their destination of signing up for specific packages via app or SMS, they are handed the certainty that they will only consume the data on the package they have subscribed to – whether this is service-specific like ‘Facebook’ or bandwidth-specific. In effect this is the concept of pre-paid data services for post-paid customers.

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