With the rising demand for personalized broadband services, mobile operators are given a new opportunity for revenue but also are faced with the challenge of profitability and managing customer churn.
A recent Alcatel-Lucent (News - Alert) (ALU) Enriching Communications article looked at the challenges facing mobile operators to monetize their assets and provided some interesting food for thought. The article, Dynamic Policy Management: An Engine for Network Monetization, explored how mobile operators can monetize their networks and encourage additional growth with dynamic policy control systems that combine flexibility, ease of use and scalability. Personalized experiences can augment broadband revenue and reduce customer churn, while transaction- and policy-based models help monetize networks and drive growth.
In general, mobile operators welcome the rising interest in mobile broadband services given that the increasing demand for bandwidth, signaling resources and airtime boosts their revenues. However, the high cost of serving up data limits profitability, therefore mobile need to find new ways to monetize networks and kick-start new revenue growth.
According to Alcatel-Lucent, mobile operators face two fundamental business challenges:
- Profitability: Data revenues are growing but voice and text revenues are tailing off. The current services revenue growth curve is getting flatter, pointing to potential long-term profitability issues. Mobile operators want to reverse this trend so they can build a foundation for growth.
- Managing customer churn: In some markets, up to 25 percent of mobile broadband customers switch operators every year, according to Pyramid Research. Mobile operators are trying to move forward. But first, they must figure out how to keep customers on board.
Further complicating these issues are over-the-top application and content providers (ACPs), which capture consumer mind- and wallet-share and fuel market growth. Alcatel-Lucent maintains that operators must reinvent themselves with a renewed focus on personalized broadband experiences driven by mobile customer demand – they can accomplish this mission by taking a fresh look at policy management.
“Operators can move forward by blurring the lines between prepaid and postpaid models. One key step is to unify subscribers around a real-time model that focuses on superior personalization, performance and is contextual,” the article said. It went on to explain that another alternative which is to adopt a simple and flexible approach to charging, billing and interacting with customers. All of this can be achieved through a new approach to policy management using a solution such as the Alcatel-Lucent 5780 Dynamic Services Controller.
While operational goals are the focus of traditional policy management strategies, the shift toward personalized broadband services calls for an integrated approach that combines policy management, charging requirements with real-time flexibility, scalability and performance to support service velocity, according to Alcatel-Lucent. The criteria for doing so involves: creating personalized service options; addressing operational performance; the flexibility to create policies that fit their unique business needs; ease of use; scalability; and transaction-based models drive business growth.
In summary, operators need to develop transaction-based models that can monetize their network capabilities and drive business growth in a dynamic and personal way to keep pace with the increasing demand for personalized broadband services further monetize their networks.
Edited by Peter Bernstein