Telecommunication is the transmission of messages (voice, sms, video, audio e.t.c), over significant distances, for the purpose of communication. With todays mobile communication, The GSM (Global System for Mobile Communications) standard has dominated the affairs of mobile telephony and with numerous operators worldwide and vendors, Its safe to say Mobile is a world of its own.

Early GSM Architectures concentrated on the access and control layer of mobile technology with connections with Fixed like PSTN but today the Application/Service Layer is increasing and its taking the new turn in business and service provisioning to both the mobile end-users and mobile operators. Least to say the present market sells on services, applications and medias.

Prepaid services refers to services paid for in advance and one key advantage of this is because they allow customers to monitor and budget usage in advance. This is evident is todays mobile operators offerings with recharge cards at specified amounts where customers charge there phone when they want to and use the service when they want to and are not pressured by contracts or bills. Prepaid has seriously changed the face of mobile billing and payment and in a lot of countries, It is just the way to go for many mobile customers.

However for the Mobile operators and Vendors, where does a Model like Prepaid billing come in? Previously, Operators purchase their equipment first hand, Install, source for competence and then hit the market. This of course is a serious money spending exercise and it made telecommunications a business for the big money spenders. Today, The business approach is changing a bit, Some vendors like Huawei offer some sort of post billing scheme on equipments, they install and configure the equipments without firsthand payment and let you use the products for a specified period of time before payment is initiated, afterwards support and post-payment services follow. In a financial world where every investor is thinking “savings”, it looks like a way to go but issues like Quality, Trust, Contracts and Competence comes to play in this.

On another note, models like Managed Services (Outsourcing) from the likes of Ericsson also give mobile operator network management and pricing a different height and feel. It involves an operator giving the network operation to the vendor or provider with appropriate SLAs and focus on selling more airtime with services on applications and data. Sounds good for a business model but many argue on the effect on employees, locality like retrenchment and absence of local competence, post-contract continuity if model doesn’t work as it should, SLA violations, keeping up with the competition or a need to switch partners or accommodating a multi-vendor environment.

Technology today has increased and the need to cut cost and increase revenue is a major talk in every business today. With technologies like Cloud computing, distributed and Grid systems, Multi-Layered service Systems e.t.c what happens to a convergent control and service layer business model for operators? Lets think about this, Several years ago, we had many vendors, today we have basically four of them, Ericsson, Huawei, Alcatel-Lucent, and Nokia Seimens. A school of thot, If the pricing model is right, would we have more operators?

I decided to put this thoughts down because the technology of telecommunications is same with different variations from the vendors. And today, operators dont really want to be locked down to a vendor, they want to be multi-vendor is their business but today this is done by buying equipments from the vendors which takes me the thought of the Cloud IaaS initiative for Telecommunications as a Service (TaaS) where operators don’t buy products anymore, all they do is buy service and pay for what is used by their customers.

Operators are expanding their network, this implies more equipments to buy, fresh installing and configurations, team expansion, and so on but really the market for the expansion is not yet there. This is a case of building excess infrastructure for the business that is to be – who knows when? The new technology proposition should be where vendors and providers build the Infrastructure in a place and sell the service over it to the operators e.g

1. Switching Solutions where Operators only pay for Signalling Request made by end users.

2. Billing Charging Solutions where Operators pay for Interrogations to Data Points.

3. Service Based Solutions where Operators pay for content and Connection to the Service Applications.

These are just some random thoughts of what i think can be. Imagine a 7 million customer operator who wants to expand to 20 million, Dimensioning and business meetings would not be on more equipments or data centers spaces, or cost of equipments but rather cost of service from the provider. This operator can reach 20 million over night by just buying more Infrastructure service and not months to deploy a network expansion. I think this is part of the part cloud is bringing to us – A once single world diverged due to space and business cost now converging due to universal reach, cost reduction and available technology.

In Europe today, we already have operators combining their networks for greater coverage, we have some infrastructures being shared like BTS, BSC on some networks. Since convergence is looking like the way to go, If TaaS comes really alive, then an operator can use all vendors or providers infrastucture service for its services, change vendors at any time without risk , buy more or less and any time and focus on its business more since someone else is managing the network. i think IaaS in Telecommunications will  be the upgraded Managed Service in the nearest future.

In the end, I think its still our One(1) world:

Vendors/Provider (Few) – > Mobile Operators (Many) – > End Users (Numerous) but essentially what this future holds out is flexibility, Choice, and Simplicity.

One Reply to “Prepaid Telecommunications: A Vendor Perspective”

  1. Good submission Tola. This is the concept of Mobile Virtual Network Operators (MVNO) where a network operator sell mobile services to endusers without they having their own network infrastructure. I agree with you that this is the future of telecoms

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