DigitalRoute Service Control Helps CSPs to Deliver Metered Data

DigitalRoute announced the "launch of Service Control, a pre-configured solution built on the MediationZone platform. Service Control enables Communications Service Providers (CSPs) to reduce the cost of delivering metered data services via a service delivery and execution engine designed for instances where innovative services and service bundles (of voice, data, and/or next generation services) form the core of a competitive strategy.

“.. Service Control is already being used with impressive results:

• One North American operator notes, 'Providing services in a new, disruptive way using a Freemium model has challenged us to find a lean and cost effective counting solution. Service Control has been our answer. On top of this, we need to continually evolve our offering and be able to quickly introduce new services like toll free data, or high cost payment services. Either way, fast T-T-M is critical to success. 

• A European operator now using Service Control comments “Rapid service creation was not possible in our legacy BSS stack, but enabling new roaming bucket services in time for the vacation season was achieved after the introduction of Service Control by DigitalRoute – and in only a few week’s time!”

See "DigitalRoute Launches Service Control Solution to Meet Telco Market Demand" - here.

Comcast on UBB: "we're not adopting it .. we are watching it"

During his presentation at Barclays Capital Global Communications, Media, and Technology Conference, Mike Angelakis (picture), CFO, Comcast Corporation was asked by James Ratcliffe, Analyst, Barclays Capital on Usage based Billing (or "metered billing"):

"How do you think about usage-based pricing around data? You folks have had a very high cap in bytes -- 200 gigabytes for a couple, I guess close to three years now, sort of targeting the small portion of the customers who are very high load on the network. I mean how do you think about that versus potentially more tiering --?"

The answer was:

"You know, usage-based pricing -- I don't think we've --first of all be clear, we're not adopting it. Obviously, we are watching it. We're very comfortable with our structure. Our goal is to really capture share and increase ARPU. And I think that -- and make sure that we have the best product that's going in the house or in the business. And I think that we absolutely do, whether it's in the business or in the house. So we're pretty comfortable with the model. We've deployed the instrumentation that people need to sort of gauge how much they're using, and if we ever wanted to go to usage-based billing or consumption-based billing, we could possibly do that. I don't know why we would disrupt a pretty good run we're having right now. We feel really good about our capacity and our capability to continue to manage additional bandwidth needs. So I feel pretty good"

Full transcript - here.

Metering and Billing Wireless Data for 20M Subscribers is not Trivial

  
Few months ago a lawsuit was filed against AT&T claiming that (see video below from NBC's Today show) - " .. the company's billing system records data use up to three times the actual use, including "phantom" charges that occur when the phone is not in use".

See report by Chris Foresman (picture) to arstechnica - "How a law firm tested "phantom" AT&T smartphone data use"  - here. 
 
The article presents the "The independent tests were conducted with multiple devices over a period of four months, and allegedly show that AT&T's billing system regularly recorded data use that exceeded actual use by 7-14 percent, on average. In some cases, AT&T reportedly recorded data use as much as 300 percent of the actual use. To confirm the "phantom" data charges, a computer engineer hired by the law firms involved in the case took a brand new iPhone, turned off all push notifications and location services, did not set up any e-mail accounts, and made sure no applications were running. After 10 days of sitting idle, AT&T recorded 35 instances of data use totaling over 2MB".

AT&T spokesperson Seth Bloom said that "all activity, including checking e-mail, Web browsing, and streaming music, uses data. But so do many mobile apps, such as weather apps and stock tickers, which update using data from the network. Games connect to networks like Game Center, and visual voicemail services download data from the network. The company also claims data could be transmitted or received by background processes that users simply aren't aware of .. AT&T captures your data activity nightly to create a bill record in our systems .. This will appear on your bill to be a late night 'charge,' but in fact, the time stamp reflects the time that your device established a connection to the [billing system], not the time that you sent or received data."

  

FCC: Usage-Based Pricing is Important

 

In his recent statement on the updated Net Neutrality guidelines (see "FCC: Updates to Net Neutrality Guidelines" - here) FCC's chairman Genachowski also said the following - "Our work has also demonstrated the importance of business innovation to promote network investment and efficient use of networks, including measures to match price to cost such as usage-based pricing".

This was said in a wide-context, not limited to wireline or wireless services. The Wall Street Journal quotes AT&T Senior Vice President-Federal Regulatory Robert W. Quinn Jr (picture) saying "We were appreciative of them clarifying it" (see "FCC Chief Backs Usage-Based Broadband Pricing" - here) 

See also: 

• Verizon - Speed and Usage Price Tiering - here
• AT&T - Yes for Metered Wireless, No for Metered DSL - here
• CRTC [Canada] Approves Usage Based Billing to Bell Canada - here

 

CHETAN SHARMA: 2010 Average Mobile Data Consumption to Grow 112% Y/Y

   

Chetan Sharma concludes in his recent report that: "Data traffic continued to increase across all networks. There are some superphones that are routinely average more than 1 GB/mo, superphones as a category is averaging 700-800 MB/mo. By the end of 2010, we expect the average US consumption to be approximately 325 MB/mo up 112% from 2009 .. Given that it is also becoming the largest deployment base for HSPA+ and LTE, most of the cutting edge research in areas of data management and experimentation with policy, regulations, strategy, and business models is taking place in the networks of the US operators and keenly watched by players across the global ecosystem."

See "US wireless Market - Q3 2010 Update" (here) and the extracted charts below showing data vs. voice services terns in terms of  revenues ("the mobile data revenues for the US market are likely to reach $55B in 2010") and ARPU ("average data ARPU grew by $0.82 or 5% Q/Q").

"As we had forecasted, the tiered pricing structure for mobile broadband expanded further with Verizon and T-Mobile following AT&T in deploying policy management strategies for controlling data margins. We will see the pricing evolve over the next 2-4 quarters as the US mobile ecosystem adjusts to the new realities and strategies for mobile data consumption"

 

See previous reports - here and here

CRTC [Canada] Approves Usage Based Billing to Bell Canada

 

A recent decision by the Canadian regulator, CRTC, allows Bell Canada to use metered (usage based) billing in its wholesale broadband service:

"In this decision, the Commission approves the Bell companies’ request to review and vary Telecom Decision 2010-255 with respect to the implementation of usage-based billing for their Gateway Access Services (GAS) customers and with respect to equivalent treatment as it relates to promotions. The Commission also approves the Bell companies’ request regarding the level of rates for the GAS UBB component and excessive usage charge, and initiates a proceeding to examine whether the rates for the UBB components of GAS and of third-party Internet access service should be lower than the comparable retail UBB rates. Finally, the Commission denies the Bell companies’ request to readjust the costs used to determine the flat-fee component of GAS."

See "Telecom Decision CRTC 2010-802" - here.

CBCNEWS reports (here) that based on this decision - ".. Bell will charge wholesale service providers a flat monthly fee to connect to its network, and for a set monthly usage limit per each ISP customer the ISP has. Beyond that set limit, users will be charged per gigabyte, depending on the speed of their connections. Customers using the fastest connections of five megabits per second, for example, will have a monthly allotment of 60 GB, beyond which Bell will charge $1.12 per GB to a maximum of $22.50. If a customer uses more than 300 GB a month, Bell will also be able to implement an additional charge of 75 cents per gigabyte."

While in mobile service, usage based billing gains traction (leading to Bill Shock Prevention regulation), in fixed services (cable or DSL) there is still hesitation to implement it after so many years of flat rates (see - AT&T). No wonder a wholesale giant like Bell can do it, potentially leaving the small ISPs with no other choice.  It seems that "fair use" policies are more common today (example - Telenet)

Telenet (Belgium): Unlimited, but Fair Use, Means 2.7TB per Month!

 

When I covered FTS, a vendor of policy management products (here), I mentioned one of their flagship projects - Telenet "Telemeter", implementing a quota based policy for the Belgium Cable operator.

On July Telenet added unlimited service plans (here). Its "TurboNet" plan, which similar to the "ExpressNet" plan offers unlimited volume for extra €18/month (see all plans below).

Nevertheless, the new plans are subject for "fair-use", which is defined by Telenet as follows:

"The term "Fair use" means that you can send and receive a very large quantity of data via the Telenet network. Telenet will only ask you to adjust your consumption in the case of excessive volume consumption that may threaten the comfort of other subscribers.

We understand excessive volume consumption to mean consumption that is at least double the average volume consumption of all subscribers for your Internet product. In the case of excessive volume consumption, Telenet reserves the right to reduce the download speed to the minimum of 512 Kbps until the next charging period begins.

"Fair use" can only be used for private purposes and occur in full compliance with Telenet’s general conditions and code of conduct. Among other things, this means that the subscriber can only disseminate legal data." [Does it mean that downloading illegal data is OK?]

So how does it translate into the users' activity?

Telenet was kind enough to publish the activity of their 25 top users (here). #1 consumed, in one month,  2.7TB (that’s Tera, not Giga!) with the "Turbonet" plan (30 mbps).

All top10 are close or above 1TB. Certainly more than "double the average volume consumption of all subscribers" (#1 is almost 4 times #25 ; Telenet has close to 1.2M internet subscribers - see a "telemeter" report for a "normal" user).





A good marketing tool, for Telenet - as still, the limited "ExpressNet" plan is the most sold (here)

 

AT&T - Yes for Metered Wireless, No for Metered DSL

 
While AT&T ends unlimited wireless (here), it has also terminated its metered billing trials in Nevada and Texas - according to a DSLReports.com  (here).

Seems like fixed broadband is not ready yet for usage based billing, after "all you can eat" was there since the day 1 of the internet.

See a 3 months old post - "AT&T CEO Sees Metered Pricing in Future" - here.