Many telcos manage their interconnect billing requirements using an in-house process or system. Such solutions may be as complex as bespoke-developed software – or as simple as Excel spreadsheets. But as your wholesale business grows, can they meet the challenge?

1 How much time and effort do you want to invest creating a piece of software?

Proprietary interconnect billing systems are highly complex affairs, developed over many years and often containing many millions of lines of code. There are valid reasons why vendors have invested all this time. By contrast, telcos are generally here to make money, rather than build software. In the early days of the in-house system, it is usually not foreseen that the task may take many years to complete – and development may proceed in a piecemeal fashion. But over the years, a dependency may be created on key individuals who ‘own’ the unique software code, and the cost of effort may well exceed the cost of investing in a proprietary system.

2 Is it quick enough?

Is the in-house solution consistently successful at sending bills out in week 1 of the next month? Month-end is always a busy time for interconnect departments. Rating of millions / billions of CDRs must all be complete, all reference data must be up to date, any re-rating must have been concluded. With interconnect revenues representing anywhere between 25% and 60% of carriers’ overall revenues, such invoicing delays hurt the business, weaken the company’s image, and diminish your ability to act convincingly should a partner settlement dispute arise.

3 Can it show you the things ‘you don’t know’?

Many in-house systems approach the task by querying the traffic which is known on the network. It’s okay to ‘fish’ in the pool for what you know – but what about the unknown things which may also be swimming around? Operators may send you traffic which is not in your agreement; traffic equals revenue, but using this technique, you may not realise it’s there. A proprietary system will always capture such “suspense” traffic, and present it for analysis and resolution. In fact, suspense % may be viewed as a KPI for the entire health of your interconnect business.

4 Is it giving you a complete absence of disputes?

Some occasional dispute between partners is inevitable. It is an expected element of the business process. If you are always in dispute with your partners, then clearly that is a problem. Equally, if partners are never raising a dispute – and are paying their invoices without question – this suggests you might be under-charging them, and should always be investigated. Occasional dispute is healthy!

5 Does it comply with international audit standards?

Company auditors expect accounting systems to comply with tough international standards for audit, such as Sarbanes-Oxley / sas70. In practice, this means a foolproof audit trail must be created including a full log of user actions and system calculations and which may not be tampered with retrospectively. The need also to deliver audit compliance standards can be extremely challenging for a home-developed solution. Yet without it, auditors may refuse to sign off company accounts?

6 Is it robust enough to help you win disputes?

If two parties cannot resolve an interconnect dispute, ultimately it may pass to arbitration and the involvement of the regulator. Consideration will be given to the question “which party’s figures and calculations are correct?” You may be right, they may be right – but confidence in the accuracy of a recognised proprietary system will always be higher, than in an in-house solution.

7 Is it robust enough to attract the confidence of potential interconnect partners?

Successful growth of a wholesale business means attracting and signing new interconnect partner agreements. Before doing business with you, potential partners will prefer to see that you have an accurate, efficient interconnect billing system in place. The last thing they want, is dispute and disagreement every month over invoice accuracy. This may be a preference or, in some cases, even a legal requirement. As such, having such a system in place may be the difference between success and failure in closing a bilateral agreement.

8 Is it future-proof for new products and services?

Through sheer dedication and commitment, telco IT departments may get their in-house solution into a position where it functions effectively. But for how long? The sudden impact of new switches, new products and services, changing technologies and file protocols, all can make the system obsolete overnight. Restoring operational status may require further back-end development work and delay each time. By contrast, off the shelf vendor systems are expected to be future proof for the impact of NGN, 3G products and services, VoIP protocols etc., and will be user configurable to make the addition and setup of new interconnect partners a simple matter.

9 Can you get reports out of it?

Since month-end billing consumes so much attention, reporting is often overlooked by in-house systems and reports may only be produced for the business some days or even weeks after the billing period is closed. Real-time reporting is desirable for many reasons – margin analysis, KPIs, statistics, even fraud-related intelligence (eg. alerts for excessive traffic / no traffic) – are all realistic expectations of an interconnect billing system, and can greatly benefit the business.

10 Are you trying to ‘avoid capex’ when no capex may be needed?

Traditionally, proprietary billing systems earned a reputation as $multi-million, hardware-hungry monsters requiring long and complex implementation projects and a major capex hit for the business. And so, staying with the home-made solution at least avoids the pain of this project. Yet in today’s highly competitive vendor market, levels of choice are high, and many vendors offer flexible budgetary models to include outsourced, leased or even managed service options which , in some cases, are commercially scaled against your actual business and traffic useage. Affordability has never been better, and it may be possible to implement a vendor system with all the attractions of the opex model.