Can’t enhance revenues? Cut costs

Operators have still not been able to get their act together as far as OSS/BSS is concerned. Instead of having an OSS/BSS strategy, they are adopting an ad hoc approach. The results could be disastrous. Today, it’s the OSS/BSS system, which is the lifeline of any service provider in terms of offering new services and revenue maximization. If the industry is going to take time to get focussed on enhancing revenue, it might not be too long when it would be forced to consider chopping costs instead.

What is needed is sophisticated network cost management tools to meet the most-critical operational challenges confronting almost all service providers. Concern areas for operators are matching capacity to expected demand, proven reliable data, and data analysis methods for switch purchase and placement decisions. This enables network optimization to go hand-in-hand with the build-out.

Also, in telecom networks, cash flow depends on how effectively are you able to keep track of the hundreds and thousands of signals, which indicate costs from the end-user recovered for using the network for a particular service. Network activity data has to be gathered in real-time and given to enterprise users in the form of clear and understandable reports, so that customers can make cost reducing decisions on a daily, weekly, or monthly basis. A good service for the users but not the best approach for revenue maximization.

Several major international carriers, which are in the middle of deep financial recession and very low demand growth, are already using these solutions to keep running. According to some reports, there has been a reduction in network operations costs from 5—30 percent.

While the good news is that such tools are there and can be deployed with very fast payback, the bad news is that it will not be a great move to start with. Because the end result is that the service provider is not offering newer services, or better customer care and support for which he can charge more. Instead, in an attempt to hold the user, he is offering cheaper rates.

This means that the operator could get sucked into a self-destructing, cost-cutting cycle rather than a service offering revenue-generation growth path.