Wireless Billing Methodologies

The use of mobile wireless is exploding. As wireless evolves, so do the associated revenue equations. Whereas 90 percent of wireless revenue worldwide comes from voice services, wireless data is expected to become a more significant contributor to the overall revenue derived from mobile services. As mobile networks evolve to provide higher speeds and location capabilities, newer and more powerful wireless applications will be created. These will lead to newer business models and complex value chains, making wireless billing a complicated process.


So far, mobile services have been charged based on duration of usage. With the emergence of packet-based mobile data services using the General Packet Radio Service (GPRS), we'll see an emergence of volume- based pricing. Wireless data services like mobile Internet will be charged based on the number of packets of data sent or received. As these services proliferate, there will be a need to evolve from volume- based to service-based billing, wherein services are charged based on the value of data. Other issues like Quality of Service (QOS) will have to be considered. Mitigating factors, like bad connections and retransmissions due to network problems, would have to be taken into account before billing the user.


Location technologies now allow the mobile networks to identify the precise geographic position of mobile users. Operators can employ location information to bill the users based on the location. Charging at rates comparable to fixed line while the user is near to his/her residence can make mobile service a very attractive alternative to fixed line.


One of the most essential aspects of m-commerce adoption is the ability to enable convenient and secure mechanisms of payment by the mobile users. Unlike the ISPs, who have in most cases been limited to providing access to users with the value-added service providers and vendors taking most of the e-commerce revenues, mobile operators see themselves playing a much more significant role in the m-commerce value chain. Future wireless billing systems will include microbilling, wherein the user buys services via a mobile device and the mobile operator adds the amount (typically less than $1) to the monthly bill. By enabling billing of higher-priced merchandise bought by the mobile user, so-called macrobilling, mobile operators can expect to reap even more benefits from the m-commerce revolution. However, this would require mobile operators to establish sophisticated and complicated billing systems.


Wireless information services will involve new value chains. As content usage begins to drive mobile usage, content providers will demand revenue shares from service providers. Billing services would therefore have to include sharing of revenues between operators and content providers. We might also see sponsored content services, wherein users will be offered free or subsidized access to wireless services in exchange for receiving advertisements and promotions. Billing systems will therefore have to be flexible enough to handle these kinds of business arrangements.


Enterprises are becoming very significant consumers of basic and advanced wireless services. As businesses adopt newer value-added services, expectations of more advanced and more transparent billing services will increase. Enterprises will demand that tariff schemes be tightly coupled with the QOS offered. Roaming is a high-value service, and business consumers are already demanding much more transparent and efficient billing for roaming services. The situation will become even more complicated with advanced voice and service roaming available with third-generation (3G) wireless services.

As we have seen, wireless billing is evolving to handle much more advanced and much more complicated service combinations. Efficient wireless billing will have a central role in the adoption of advanced wireless applications. For mobile carriers, this means that billing will become a highly specialized component of the overall mobile offering. Because of this increasingly complex demand, many service providers are choosing to outsource their billing operations.

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