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Operators losing $58bn on poor billing systems, finds report

Mobile operators worldwide are set to face a decline in revenue by 2018, according to Ovum

The mobile industry lost more than $58bn in 2011, due to inadequate operator billing systems, according to a report published this week. The figure, which represents over six per cent of operators’ global revenues, was attributable to inadequate fraud management and revenue assurance processes, according to Juniper Research. And it is a figure that currently looks set to grow.

The report suggests that under a ‘nightmare scenario’ whereby operators fail to implement any remedial measures over the next five years, the scale of losses could rise five-fold by 2016.

As operators have had to integrate an increasing range of devices and simultaneously manage a surge in network traffic, billing systems have failed to keep pace, according to the report. As a result, they are increasingly unable to accurately or efficiently capture the large volume of transactions that occur on the network.

The complexity has magnified the scale of revenue loss, resulting in bad debts and a greater opportunity for fraud. However, operators can minimise the losses by implementing automated system solutions that provide comprehensive visibility of the revenue chain, suggests Juniper.

With sustained investment, the firm’s study finds that leakage will decline to four per cent of revenue in 2016, representing a net reduction of nearly $15bn per annum compared with 2011.

‘As the industry moves more aggressively into a 4G-LTE environment, telcos risk undermining any revenue actually earned from value-added services by continuing to not invest in appropriate business support systems,” said report co-author Dr Windsor Holden. “Despite their initial costs, RA and FM systems demonstrate a strong case for return on investment.’


2 comments

  1. Alem 28/03/2012 @ 3:32 pm

    This issues has been around for a while. At the early stage of our Billing solution development we knew about this problem and implemented a Native Revenue Assurance techniques in our Billing platform which are applied at all stages of processing, with continuous checking of end-to-end balances for each process as well as for the system as a whole ensuring maximum revenue. http://zira.com.ba/features

  2. Natasha Geldard 29/03/2012 @ 12:41 pm

    With the sophisticated BSS available today, operators should not be losing out to poor systems. Many would argue that the revenues are not there to simply replace these systems, but Convergys approach is to solve today’s immediate issues allowing the operator to have the tools to evolve to take advantage of tomorrow’s opportunities. More revenue is being lost by simply not doing anything and intelligent, flexible systems that can grow with your business are the smart way of doing things.

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