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Summary

International IPX providers have within their reach critical business information that can help mobile operators target roaming customers with more competitive and better services. BICS is already offering business intelligence (BI) data, providing a valuable service to its customers and creating a value-added revenue stream for itself. This is a development that other IPX providers should replicate and that more mobile operators need to take advantage of.

Business intelligence provides tools to defend roaming revenue

Mobile operators are facing the biggest challenge to their roaming businesses in the history of mobile communications. OTT voice, video, and messaging services are impacting on the roaming revenues of mobile operators. Ovum estimates that an average operator’s roaming revenues will decline at a CAGR of up to 20% over the next five years. Although data roaming revenues are increasing at a similar rate, they are growing from a lower base and won’t offset the losses.

Mobile operators are entering a critical period because LTE roaming drives growth in both operator data revenues and OTT usage. Many are introducing innovative tariffs and plans, but they are doing so blind, unable to measure their effectiveness. With more detailed information, operators will have a greater opportunity to target customers with more competitive and better services.

BICS’s solution for asset monetization is modular and covers fraud prevention, performance measurement and monitoring, and BI. The BI elements include customer tracking to identify types of roamer (e.g. VIP, silent, or frequent), market share information, and cost information for business modeling.

As mobile operators roll out LTE, we expect more than 75% to use a third-party IPX provider to facilitate their roaming services. BICS currently carries around 25% of all global communications and is a market leader in providing IPX-based roaming services for operators. Therefore it has access to a combination of data sources that are useful to operators looking to devise next-generation roaming strategies. Signaling data from SS7 and Diameter provides basic activity information, highlighting when customers are roaming and what services are being used; data gathered from the IP layer (including that gathered from deep packet inspection) details information about application use; and transferred account procedure files hold the commercial information about the costs associated with each type of usage.

BICS launched its asset maximization solution in 2013, and 100 modules are now used by 45 customers. Initial interest was in the measurement and monitoring tools. However, in the last year, the BI elements have become much more popular. Operators need to understand the usage and spending patterns of their customers and match these patterns against associated costs. Sitting in-between operators, IPX providers have the ability to offer exactly that. BICS is utilizing this position to differentiate its IPX-based roaming services from others. However, we expect other IPX providers with a similar combination of roaming services and global network ownership to offer BI services in the coming year.

Appendix

Further reading

Innovative Roaming Offers Tracker: 1H16, TE0009-001495 (January 2016)

IPX Providers Key to New Service Revenue Growth for MNOs, TE0012-000558 (November 2015)

“LTE entices mobile operators to consider becoming IPX providers,” TE0012-000534 (March 2015)

The Future of International Interconnection, TE0012-000528 (December 2014)

Wholesale Operator Profile: BICS, TE0012-000517 (September 2014)

ITW 2014 Highlights New Trends in International Interconnection,TE0012-000509 (June 2014)

Comparative Analysis of IPX Wholesale Provider Strategies,TE012-000450 (April 2013)

Putting IPX in Its Place, TE012-000448 (March 2013)

“Flexibility features put Telstra on IPX map in Asia-Pacific,” TE012-000461 (July 2013)

Author

Catherine Haslam, Senior Analyst, Wholesale Telecoms

catherine.haslam@ovum.com

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