The Evolution of Interconnect Billing

By Ben Bannister, Product Marketing Manager

A greater focus on cost control and more active wholesale margin management has changed the very nature of traditional interconnect billing and settlement markets. Frequent price plans, numbering plans and partner reference data updates are the order of the day. This is a result of complex discount structures, volume-based commitments and variable rating requirements prevalent today. Operators are spending valuable time on managing and updating their systems instead of putting their time to better use, such as pro-actively managing the wholesale business.

Under the current conditions, it is smart and sensible to consider a managed service environment as a plausible future for interconnect billing and partner management. Mobile network operators have always appreciated the cost and convenience benefits of managed services in the roaming environment. So, the appeal to reduce unnecessary costs and free themselves from processes by outsourcing is readily accepted. The technology used in managed services not only offers flexibility and user control but also ensures that online user portals, near real-time reporting and web based dashboards can be operated with exactly the same or even better levels of control from a managed service proposition, compared to an in-house solution.

The best part is that the operator can outsource his interconnect and partner settlement processes and still retain full commercial control. As the managed service provider takes care of all the billing functions ( including event processing, rating, error correction, duplicate checking, reporting and financial settlement) the operator can focus on the commercial relations with its interconnect and content partners. This helps the operator to make sure that he has the best rates, the best routes and is achieving both revenue and margin objectives. There are multiple benefits of deploying a managed service provider. Apart from convenience, measureable and assured cost benefits, operators benefit from the ease of re-engineering costs and controlling them by changing the way that assets and liabilities are accounted for.

In the future, the relationship between interconnect billing and roaming processes is likely to be more closely aligned as downward pressure on inter-operator termination rates squeezes wholesale margins. Using a common managed process across roaming and interconnect can, for the first time, provide the operator with visibility of their overall wholesale costs and margins. It can also highlight potential issues where roaming calls can transit interconnect links with a higher cost than the retail price of the roaming calls.

Such an exciting development will take interconnect towards a much more dynamic hubbing exchange based model, away from the more conventional silo approach. So why manage interconnect systems when the processes they support can be managed for you?  Why maintain a costly in-house system when you can enjoy the economies of scale and expertise of a specialist managed service provider?

About MACH

MACH connects and monetizes the telecom world with cloud-based, managed communications services that monetize mobile data, simplify interoperability between networks, optimize wholesale processes and protect revenues. Combining its flair for successful innovation with its long heritage in data and financial clearing, settlement and hub based connectivity models, it provides its 650 operator customers with the real-time, value added services necessary to succeed in 3G and new 4G mobile ecosystems.
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