Telcos frequently employ multiple systems from multiple suppliers, is there a benefit in seeking specialist suppliers or those offering a wide range of support systems from one source? The case for using a single package for data collection, mediation and billing rather than sourcing systems from different suppliers, by Andy Tatarzycki of uni-X Software.

Fashion is a fickle business, and the latest trends in the billing world reflect this. The arrival of the Internet and IP has naturally complicated the implementation and delivery of fully scaleable and flexible billing systems, but does this mean that users must shop around on a never ending journey, 'buying and trying' compatible components, in order to complete the billing jigsaw.

The current industry climate subscribes to the idea of sourcing the data collection and mediation requirement separately from the billing elements. Companies such as Xacct and Narus are just some of those that champion this approach, yet can this philosophy work for all types of organisations?

A closer look at how complete billing solutions work in contrast to more specialist systems that offer collection and mediation, begins to highlight the pros and cons of each 'camp'. But first, we need to establish the types of companies that are looking for IP billing solutions in the first place, and what these organisations and their relative expectations are.

The major target markets for billing suppliers fall into three categories; telcos & operators, service providers (ISPs, ASPs) and more recently large corporates with widely distributed IP based networks. These are the principle buyers, all with slightly different objectives. This is why it is over-simplistic to say that a holistic solution is superior to an off-the-shelf solution that offers only collection and mediation - or vice versa.

Telcos represent the most traditional and well established customer base for billing vendors. The larger telcos such as Deutsche Telekom, BT, France Telecom and SwissCom have all inherited gargantuan billing engines that are the results of years of evolution. For this group, the appeal of 'add-on' solutions or collection and mediation only offerings is high, as they need to protect the investment of expensive legacy systems. The sheer size and impact of these on the operator's overall business is so critical, that completely replacing such a system could prove disastrous to their overall operations. However, because their old customer base is being threatened by competition from all sides, they still need to develop new billing capability for emerging markets and revenue opportunities such as ASP (application service provisioning) and/or Mobile & 3G technologies. What a comprehensive data collection, mediation and accounting solution can provide here, is the means to quickly upgrade a billing engine to cater for these new customers. A unique product can provide collection and mediation as well as produce tariffing models that can be interfaced with a telco's ERP system or similar. This means that there is no need to source a third party vendor to provide the bridge between the mediation and the billing centre.

The issue of integration is a key factor when discussing the strengths and weaknesses of mediation versus full blown mediation & billing solutions. For the service provider market, which has seen the largest growth of all three markets being considered, the scale of integration for such as project can be critical and should not be underestimated. In the eyes of the service provider, the arguments of the mediation camp soon become weakened. This is because their proposition is partly flawed. Unlike telcos, the majority of service providers are not burdened by the ghost of an out of date billing system, but in fact have no purpose built system at all. Often these companies are starting with a blank canvas, so all the benefits of buying in a complete system become more sensible. In this situation the scale of integration is reduced and the responsibility lies with a single supplier, i.e. the billing vendor. This makes life easier for service provider's billing or IT managers as they do not have to take the integration in-house and have the added benefit of dealing with one supplier. Both these factors can lead to quicker implementation and lower cost.

The problem with opting for data collection and mediation on its own is that the process ultimately becomes more complicated. The service provider needs to choose another vendor to provide the billing & accounting functionality. With more suppliers comes the prospect of exacerbated compatibility and integration troubles. Although the scaled down solutions claim to work with all the major billing engines, there is no escaping the fact that all the elements must be soldered together - but by whom? It is unlikely that service providers have the in-depth experience to carry out the integration themselves. When dealing with just one supplier it is clear to see where the buck stops, but when the complete billing system is the product of many, the realms of responsibility become more blurred.

Once the system is installed, the issue of integration does not disappear, especially in such a dynamic market shared by ISPs, ASPs and content providers. With constant pressure to outwit the competition, SPs (service providers) must continually upgrade services. If the whole system is provided by a single vendor, upgrades are more straightforward and do not require the cooperation of third parties. Single vendor solutions will undoubtedly (sic) be faster in delivering new modules than multiple vendor offerings, as the learning curve is dramatically diminished. New services are ready in days not months.

In some cases integration costs have been known to soar higher than the cost of the billing system itself! So the question that presents itself is - why take the risk, when you can 'outsource' all integration and interoperability issues with one vendor. (There will be sound financial or technical reasons, at least for doing so.Ed) The other post-sales scenario that can pose a problem is the subject of support. With
a 'hybrid' system it is more difficult to identify where problems lie, let alone decide who should fix it. A single vendor solution affords an obvious point of
contact and (perhaps) a clear idea of how long will take to be resolved.

The other issue that streamlined solutions precipitate is that they place the onus on the network manager to configure the network correctly. With a complete mediation and billing system there is less room for error, as all data is de-duplicated into the equivalent of CDRs before being calculated for billing. With a mediation only offering relying on probes, it is possible that misconfiguration could lead to wrongly attributable packets of data being used. These are all considerations that a service provider must take into account before committing themselves to one or more billing vendors.

The third market is the corporate market. Its nature is unlike the other two in that corporates are not trying to bill customers, but are attempting to quantify the costs of IT resources across their organisation. It is unlikely that the organisation already has a billing engine dedicated to attributing IP usage! Also, the IT manager is not likely to be familiar with all the varying billing packages on the market.

As IP usage becomes a larger part of the corporate budget, the need for a billing device will increase. Until now, activity based accounting for IT resources has been a matter of conjecture with no means of re-charging IT expenses back to departments or individuals. Not only can financial directors understand what departments are spending what and budget accordingly, but the IT manager can save money by refining the IT infrastructure as a result of the costings analysis and concentrate on IT planning. Many IT managers are dogged by day to day fire-fighting when they should be employed to enhance the IT infrastructure in a bid to make it more effective. An IP billing tool will enable them to quickly pinpoint where resources are being spent on the network and therefore prevent bottlenecks, overloading and subsequent downtime.

Consequently, it is in the corporate arena where we will see a dramatic growth in the demand for IP billing in the immediate future. Data collection & mediation will certainly be useful to the IT department, but a completely integrated solution will offer them full cost transparency for their IP networks. (Deutsche Bank is an example where uni-X has provided a complete mediation and billing solution to identify the resource usage relating to the organisation's widespread use of Lotus Notes-in excess of 100,000 users.)

The fact that independent collection and mediation solutions are currently popular does not necessarily mean they make good business sense. In the long-term billing vendors will begin to understand that as their customer base alters, it will be prudent to reexamine the positioning of products and the ways in which they are packaged and sold. The simplicity of the 'Power of One' is likely to be a strong contender.

www.uni-X.com