«Bill shock» stirs price plan paradigm shift

Humera Malik/Redknee
21 Oct 2010
00:00
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Daily News

It is almost autumn again, and for many of us this means paying the bills for our summer holiday. Unfortunately in many cases it also means dreading the mobile bills from that very same holiday. Mobile subscribers in markets with flat-rate models have grown used to consuming data and not worrying about the bill. But as more operators implement tiered and usage-based price plans, it is likely we will see more of the now familiar press stories about mobile subscribers suffering from a condition widely known as 'bill shock' after receiving an extraordinarily high bill. Transparent and real-time communication between mobile operators and their customers are of paramount importance in the changing paradigm from flat-rate price plans to usage-based plans.

Bill shock is not just bad publicity waiting to happen; it will soon be widely regulated against. Authorities in the EU already insist that operators warn customers of approaching and impending bill shock when they reach 80 percent of their data allowance. Meanwhile, U.S. regulator, the Federal Communications Commission, has opened a public consultation paper on how it should protect wireless consumers from bill shock, and it is expected that many more regulatory authorities will follow suit in the near future.

Providing subscribers with greater transparency about their usage and implementing tiered plans and alerts should not be viewed as merely a compliance issue; operators should take this opportunity to reconnect with their subscribers while they are at home and abroad. While usage control notifications are a first step towards bridging the gap, the value of real-time communication lies in its ability to underpin an operator's data monetization strategy to not only deepen relationships with their subscribers but to grow them into profitable ones.

It is clear that these regulations, along with rising data traffic and mobile broadband growth, are creating a serious revenue opportunity for service providers. The challenge is to capture this potential without scaring off existing customers with newly priced packages, particularly for data. Through real-time communication and empowering customer interaction, service providers can achieve the next level of innovation by creating a two-way relationship with their subscribers to not only get a better understanding of their needs, but also to provide subscribers with more control.

From a customer's perspective, this enables them to make informed decisions about modifying price plans, bill payments, third-party applications and service payments. However, in order for operators to achieve this, their own processes and systems must be able to manage the lifecycle of the subscriber in a more cohesive way.

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