Analysys Mason Converged Billing Systems Jan2013 SampleToC RMA03

© Analysys Mason Limited 2013

Convergent billing systems are inevitable: it is only a matter of when and how

Research Report

Convergent billing systems are inevitable: it is only a

matter of when and how

January 2013

Justin van der Lande



Contents

5. Executive summary

6. Executive summary [1]

7. Executive summary [2]

8. Recommendations

9. Recommendations for CSPs

10. Recommendations for vendors

11. Forecast and market shares

12. Convergent billing solutions address cost reduction and convergent

services and will provide the most growth in the billing systems market

13. Mobile services will be increasingly supported by convergent billing

solutions, which will divert spending from prepaid and postpaid solutions

14. Convergent billing solutions are set for high growth in all markets, but

still account for a minor proportion of total billing solutions revenue

15. Convergent billing solutions are predominantly focused on mobile, but

will increasingly often be used to support fixed-line mobile convergence

16. Convergent billing

17. Market drivers

18. New service revenue is cited as the most significant driver for adopting

convergent billing systems

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19. Market drivers [1]



22. Transformation strategies

23. Migrations that use adjunct systems provide the lowest risk for CSPs

when implementing convergent billing solutions

24. An upgrade approach to deploying convergent billing solutions can

provide CSPs with a relatively secure project with a known vendor

25. ‘Big bang’ transformation projects are high risk, but can lead to

significant gains in the short and long term

26. The ‘adjunct’ migration approach is the least risky option for CSPs, but

operational transformation will be needed to support it

27. Business environment

28. Changing business models and customer needs are altering the

requirements of billing systems

29. Market definitions

30. Convergent billing systems

31. Convergent billing system key component relationships and

relationships to adjacent systems

Slide no. Slide no.



Contents

32. Case studies

33. Convergent charging deployment case studies [1]



36. Company profiles

37. Amdocs

38. Comverse

39. CSG International

40. Huawei

41. Nokia Siemens Networks

42. Oracle

43. Orga Systems

44. Redknee

45. About the author and Analysys Mason

46. About the author

47. About Analysys Mason

48. Research from Analysys Mason

49. Consulting from Analysys Mason

3

Slide no.



List of figures

Figure 1: Convergent billing revenue, worldwide, 2011–2016

Figure 2: Billing systems revenue for mobile services by type, worldwide,

2011–2016

Figure 3: Convergent billing revenue by region, worldwide, 2011–2016

Figure 4: Convergent billing revenue by service sector, worldwide,

2011–2016

Figure 5: Convergent billing market shares by revenue, worldwide, 2011

Figure 6: Primary reason for introducing a convergent billing solution

Figure 7a: Market drivers for convergent billing systems

Figure 7b: Market drivers for convergent billing systems

Figure 7c: Market drivers for convergent billing systems

Figure 8: CSP chosen migration path to a convergent solution

Figure 9: Advantages and disadvantages of the upgrade approach to

convergent billing

Figure 10: Advantages and disadvantages of the transformational approach

to convergent billing

Figure 11: Advantages and disadvantages of the adjunct system approach to

convergent billing

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Figure 12: Key functions of convergent billing systems

Figure 13: Key components of convergent billing systems

Figure 14: Amdocs convergent billing products profile

Figure 15: Comverse convergent billing products profile

Figure 16: CSG International convergent billing products profile

Figure 17: Ericsson convergent billing products profile

Figure 18: Huawei convergent billing products profile

Figure 19: Nokia Siemens Networks convergent billing products profile

Figure 20: Oracle convergent billing products profile

Figure 21: Orga Systems convergent billing products profile

Figure 22: Redknee convergent billing products profile


Convergent billing systems are inevitable: it is only a matter of when and how 5

Executive summary

Recommendations

Forecast and market shares

Market drivers

Transformation strategies

Business environment

Market definitions

Case studies

Company profiles

About the author and Analysys Mason



Executive summary [1]

Convergent billing systems have been available for years, but CSPs have been slower than predicted to implement multiple

payment types on a single platform.

The drivers for moving to a convergent billing system are still valid and are based on:

reducing costs: system rationalisations enable CSPs to save on licence, integration and operational costs

incremental revenue: launching new types of services such as those that are bundled or hybrid can enable CSPs to generate

additional revenue.

Until recently, these drivers were not sufficient to deploy convergent billing systems, but the need to invest in mobile broadband

services and falling margins have led CSPs to launch new services that need convergent billing.

Projects that transform installed billing systems are complex, risky and expensive, which provides CSPs with a strong disincentive

to move established subscribers over to new systems. Adjunct systems that can be deployed more easily and involve a slower

migration often provide more-manageable projects, but running multiple systems has additional overheads and costs associated

with it.

The billing systems that many CSPs in emerging markets have deployed are capable of supporting convergent services, but are not

run in convergent mode and mainly offer prepaid services. These deployments have occurred because newer billing systems

inherently support convergent solutions as a part of their functionality and CSPs have specified this capability in their tendering

processes. This helps to future-proof new systems and provides CSPs in emerging markets with a platform that supports postpaid

mobile accounts when they are needed.

CSPs in emerging markets have a higher percentage of convergent billing systems than those in developed markets because CSPs

in emerging markets have deployed their billing software more recently and have more of a need to control costs. CSPs in

developed markets are implementing convergent billing systems as they deploy mobile broadband services such as LTE, mainly as

adjunct systems.

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Revenue generation

48%

Cost reduction

33%

Future-proofing

19%

New service revenue is cited as the most significant driver for adopting

convergent billing systems

In a recent market survey by Analysys Mason, nearly half of

the respondents cited the ability to introduce new services as

the justification for implementing a convergent billing solution.

Mobile data services were most often given as the service

type that triggers this.

Cost reduction is also cited as a justification, but not on its

own. However, some organisations reported that they had

performed transformation projects, which resulted in

convergent billing systems, in order to replace older IN

platforms that had been affected by a significant increase in

the number of subscribers and associated costs.

Justification based on cost reduction or revenue generation

may be significant, but as older billing systems are retired

because new networks require support for different functions,

billing systems are naturally replaced and upgraded. These

replacements tend to support convergent services by default.

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Figure 6: Primary reason for introducing a convergent billing solution

[Source: Analysys Mason, 2013]1

1 Question: “Please specify the drivers for convergent billing as a percentage of total installs

into the following categories: A – cost reduction; B – increased revenue; C – future proofing”;

n = 12 vendors with a combined installed base of more than 700 CSP customers.


Convergent billing systems are inevitable: it is only a matter of when and how 46

Executive summary

Recommendations

Forecast and market shares

Market drivers

Transformation strategies

Business environment

Market definitions

Case studies

Company profiles

About the author and Analysys Mason



About the author

Justin van der Lande (Senior Analyst) leads the Revenue Management programme (formerly Billing), which is part

of Analysys Mason’s Telecoms Software research stream. He specialises in business intelligence and analytics

tools, the functionality of which cuts across all of the research programmes in this area. He also provides project

management for large-scale projects within our Telecoms Software research. Justin has more than 20 years’

experience in the communications industry in software development, marketing and research. He has held senior

positions at NCR/AT&T, Micromuse (IBM), Granite Systems (Telcordia) and at the TM Forum. Justin holds a BSc in

Management Science and Computer Studies from the University of Wales.

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About Analysys Mason

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knowledge of our people, is what sets Analysys Mason apart. We deliver our key services via two channels: consulting and research.

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For more information, please visit www.analysysmason.com/research.



Research from Analysys Mason

We provide dedicated coverage of developments in the telecoms, media and technology (TMT) sectors,

through a range of research programmes that focus on different services and regions of the world.

49

Alongside our standardised suite of research programmes, our Custom Research team undertakes specialised, bespoke research

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To find out more, please visit www.analysysmason.com/research.



Consulting from Analysys Mason

For more than 25 years, our consultants have

been bringing the benefits of applied intelligence

to enable clients around the world to make

the most of their opportunities.

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Our clients in the telecoms, media and technology (TMT)

sectors operate in dynamic markets where change is

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Analysys Mason Converged Billing Systems Jan2013 SampleToC RMA03