turning technology into revenue

Turning Technology into Revenue5G dictates new requirements for monetization systems

Table of ContentsMarket Dynamics 35G business challenges and opportunities 6

New revenue generation 8

Significant cost of ownership reduction 9

Enhanced customer experience 11

Higher velocity and agility 12

Amdocs 5G Monetization 13

Solution highlights 15

Worldwide leadership 17

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Market Dynamics

The challenges CSPs are facing in the rush to 5G go far beyond the evolution of the network. They extend to how operators approach multiple concurrent trends in the telecommunication and software industry that impact the monetization opportunities of the new network capabilities.

5G Use Cases Customer Expectations

Partner Ecosystem

Technology Evolution

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New 5G Use CasesWith 5G, the potential for monetizing new use cases is enabled due to the performance envelope of 5G’s design in areas such as ultra-low latency and very large bandwidth.

However, a persistent uncertainty exists relating to the operator’s ability to maximize monetization of new use cases as well as when the killer 5G application will be found. Service providers are anticipating the importance of certain use cases, and their expected impact on monetization systems, however large variations exist in operator strategies, and no ‘killer application’ has yet emerged. This requires 5G monetization systems to be ready for any use case by being flexible, open and agile.

Figure 1

Top 5G use cases expected to drive monetization systems evolution

Source: Analysys Mason, 2019

Network as a Service

Enhanced Mobile Broadband

Smart Cities

Enterprise IoT

Connected Vehicle

Consumer IoT

VR/AR

FWA

Connected Healthcare21%

24%

26%

27%

39%

44%

45%

36%

37%

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Market Dynamics

Customer ExpectationsToday’s digital consumer has come to expect new digital services that add value to their daily lives. While the average consumer is unsure what to expect from 5G, they do expect it to accelerate the rate of innovation in their lives, as well as change the way they interact with the world around them. This extends to how they interact with service providers, requiring that interactions be digital-first, hyper-personalized, choice driven and transparent. 5G Monetization systems must meet those expectations and support the on-demand economy.

Partner EcosystemAnother trend is the continuously growing digital partner ecosystem; a large and rich universe of players bringing new applications and content to the market every day. For digital service providers, the key challenge is to define appropriate business models for working with partners and provide the right tools for the business agility and velocity that will allow them to leverage the power of this ecosystem in the market.

Technology Evolution5G brings with it a new set of requirements for how monetization systems interact with the network. Support for network slicing, a new service-based interface and a move towards the edge will have a significant impact on the next generation of monetization systems.

Furthermore, operators are also facing the rapid evolution in software technology. Artificial intelligence, cloud computing, software-driven networks, virtualization, automation, edge computing and others are examples of technologies that have made tremendous leaps in the last few years. They bring higher levels of agility, velocity and cost reduction, making it very difficult for those who don’t embrace them to stay competitive.

The impact on operators’ business and the systems they rely on to drive revenues from new use cases, customer expectations, a growing partner ecosystem and the evolution of IT is great. This paper will describe the impact on the monetization systems that serve as the key to capturing every revenue opportunity, and the requirements for those systems to be considered true 5G Monetization systems.

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Market Dynamics

5G business challenges and opportunities

Higher velocity and business agility

how to use technology to achieve faster time to market and ensure high flexibility

New revenue generation

how to leverage 5G to drive substantial new sources of revenue

Significant cost reduction

how to continuously reduce total cost of ownership and operations

Enhanced customer experience

how to improve the user experience and meet the expectations of today’s digital users

The business challenges CSPs are facing on their 5G journeys fall into four categories:

1 2 3 4

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These challenges are all tied closely to the question of how monetization systems leverage new technology to meet the challenges and capture every revenue opportunity of the 5G world.

Figure 2 - Challenges of 5G Monetization

Customer experienceDigital firstAlways-onTransparencyImmediacyPersonalizedOn-demand, real-time transactionsFlexibility & choicePayment flexibility

Revenue generationVariety of use casesGrowing partner ecosystemMulti-dimensional offeringsNetwork-as-a-service monetization modelsLow latency servicesGrowing B2B businessOmni-convergent

Cost reductionDecreased cost per MBLower cost per eventCost efficient support for IoTLower HW footprintLow cost support for voice/messagingLower network footprint

Velocity and agilityFail-fast/Fail-cheapFast TTMModularity & microserevicesOpen API’sAI & AutomationIntuitive usabilityHigh performanceScalabilityDistributed architecture

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New revenue generationQuality of Experience (QoE) based offersThe abundance of very large data buckets and unlimited offers has led to the continuous decline of the price per megabyte in the mobile industry. This makes it

extremely challenging to extract new revenues from access alone. In the meanwhile, the emerging 5G network will bring with it new capabilities such as very high bandwidth, ultra-low latency and ultra-high reliability, which can be utilized to drive growth in several new applications. These include commonly cited 5G use cases such as AR, VR, immersive video, holographic communications, 4/8K video, V2X communications and more. These use cases open up new monetization possibilities in which value can be extracted from offering the appropriate QoE for each application, and/or from the bundling of connectivity with application offerings.

Many new services will require premium QoE for which charging may be usage-based and drive considerable monetization. There is also an opportunity to monetize QoE via APIs exposed to partners such as OTTs (e.g. guaranteed bandwidth for the duration of OTT 4K video) and stimulate more usage. However, as the possibilities here are wide-ranging, CSPs must have the appropriate tools to be able to create, test and roll out innovative services quickly and with controlled costs to rapidly launch and monetize new scenarios when they indicate market success.

Partner offersIn the 5G world, many advanced services will use specific applications and rendering technologies provided by partners– for example, for VR and AR gaming.

Oftentimes these services will be offered in a B2B2X business

model where the operator provides the network services to the partner and the partner sells the service to the end customer. These partners will require deeper access to CSP resources, for example, the ability to query usage, apply rating as a service or enforce QoS levels for a given user data session. To deliver such capabilities to partners, CSPs need efficient solutions that enable them to quickly on-board new partners, equip them with access and capabilities and deliver joint added-value offerings to the market. This cannot be achieved without a partner monetization solution designed for B2B2X service delivery and for the management of the end-to-end process. Importantly, it needs to include partner onboarding, partner product lifecycle management, technical API integration, partner self-service tools, revenue sharing and financial settlement.

Network-on-demandFinally, enterprises, MVNOs and vertical industries create important opportunities for growth. However, these customers are highly demanding and expect to have easy

access to on-demand communication and digital services offered by CSPs, similarly to the access to cloud services from cloud service providers. For example, sporting and event venue enterprises may purchase ad-hoc, on-demand mobile networks tailored to the needs of a given event. Another example might be the mining industry, which may require a dedicated wireless network with specific QoS such as ultra-reliability and very low latency to connect autonomous digger vehicles and lifesaving sensors. CSPs must therefore have the flexibility to respond to these demands in a timely and automated manner. In this context, support for 5G Network Slicing as a Service is a crucial capability to deliver network on-demand.

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Significant cost of ownership reduction

5G monetization is not only about finding the next killer application for the new network. Cost reduction is a critical component to maximize the potential for monetizing 5G use cases, and in many ways the success of a 5G business case will hinge on this issue. With the continuous price pressure and recurrent exponential increase of the consumed data volumes per user, CSPs are doomed to reduce the overall cost of a served megabyte, year over year. Moreover, many emerging 5G use cases (with very high throughput) will consume intensive network resources putting more pressure on the cost of a served megabyte.

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Smart resource allocationCharging systems must also contribute to TCO reduction through considerable and continuous reduction of compute, storage and transmission costs related to

event processing. In fact, charging system resources allocated to process a given event must be tailored to the type of event, the resources it consumes and to revenue it drives. For example, events related to flat-rate data allowances, which require only consumption metering, may not go through a complex rating processing path and therefore save important resources.

For commoditized services, namely voice and short messaging, most offerings are trending towards being unlimited, flat-rated or bundled with other data services, which is pushing CSPs to further reduce TCO. With 5G, voice and short-messaging will remain the same with most of the deployments on IMS (IP Multimedia Subsystem), which is integrated to the 5G core network via service-based interfaces. Hence, voice and short-messaging services must be supported more efficiently, where the convergent charging system footprint is tailored to these services and uses the minimum resources to perform the associated event processing.

CSPs will also need to maximize reusability. This includes supporting multiple lines of business with the same convergent charging solution. This will allow them to unify operations, reduce development cost and efficiently utilize infrastructure resources. Ideally CSPs will be able to use a single convergent charging system for consumer, enterprise, resellers, mobile, fixed, IoT and other digital lines of business.

The IoT challengeIn the IoT domain, 5G is accelerating IoT communications, as it provides higher density and massive connectivity. IoT has significant differences in terms of communication

needs than other types of service. In fact, most IoT devices exchange very small amounts of data, but do so very frequently and in a massive way due to the number of devices. As opposed to traditional services, with IoT a single customer can own thousands of devices and multiple device types (censors, actuators, etc.). Managing related use cases requires specific tariff plans for each device type, as well as various IoT pricing models, such as wholesale pricing, rating per device activity, allowances per device, device location, multiple device sharing and so on. Charging systems are challenged to be able to support IoT as the number of events will generate an intolerable amount of overhead that impairs cost efficiency. Hence, 5G-capable charging systems must be designed for massive small-data communications by means of aggregations, profiling and processing closer to the network, as well as leaner processing flows, thereby reducing the cost associated with processing an IoT event.

Cost efficient technologyTo further reduce TCO, the charging system must also adopt new, more cost-efficient technologies such as cloud deployments, Microservices and DevOps

methodologies. They must also adopt new architectural options including network edge processing and 5G network slicing and use artificial intelligence techniques to optimize resource usage for event processing. Importantly, CSPs will also need to look for alternatives to commercial databases for massive storage needs in order to reduce cost.

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Enhanced customer experience

Transparency and immediacyToday’s digital users have very high expectations in terms of real-time experiences and transparency. Indeed,

in the new digital world, immediacy is a given and customers (consumers, enterprises or partners) expect to have accurate and fresh information about their services spend and estimated bill at any time for all types of charges, including usage, one-time and recurring charges. To meet these expectations, CSPs must operate real-time charging and billing systems capable of calculating charges as soon as related events occur, rather than waiting for end-of-cycle batch processes.

The systems must also expose charging information to customers for real-time access and offer a comfortable customer experience which is readily available while also being non-intrusive, with no flooding, when delivering them with information via notifications. This will become even more important as data consumption is becoming more complex and will continue to do so in the world of 5G. With sharing, pooling, bundling, application-specific data buckets, automatic renewal, rollover, backward re-rating and more, increasing numbers of events may occur for which the customer must be notified (e.g. crossed threshold of given data pool).

Real-time/online charging is, indeed, of central importance to the over 70% of subscribers worldwide with prepaid plans. Besides being the only authority for service authorization, it enables other real-time experiences such as immediate access to consumption information.

Always-on Customers are also becoming extremely demanding of service availability. Occasional hardware and software failures should not impact the user experience and

service continuity must be ensured even in case of failover between sites. Here, redundant configurations with service continuity such as Active/Active are key for a seamless user experience.

Unexpected traffic spikes (e.g. during national events) and occasional localized heavy usages (e.g. in stadiums), must also be smoothly served without noticeable impact on user experience. This imposes a robust, elastic system that is able to cope with massive fluctuations – much more so than in the past.

Payment flexibilityThe rise of the popularity of subscription models for digital services has also lead to a corresponding increase in expectations from the telco industry. Digital users

have preferred payment methods and in fact may prefer not to receive a bill in favor of recurrent charges via credit cards, Google and Apple payment platforms, Amazon, PayPal, stored value cards and more. Moreover, users expect to be able to add and cancel services at any time, without restrictive cancellation rules.

Furthermore, with more partners in the service provider’s ecosystem we can expect to see additional payment models for digital services. Ad and third-party sponsored services as well as loyalty points and other forms of social currency will become options for payments. So beyond the payment models of today, 5G monetization systems must be ready for the digital economy of tomorrow.


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Higher velocity and agilityAgility and scalabilityGiven the previously discussed challenges regarding use case innovation, partner ecosystem and on-demand offers, CSPs cannot achieve efficiency and competitiveness without a high degree of agility and scalability. Use case innovation

requires an agile environment allowing for a large diversity of scenarios while on-demand offers require a high degree of elasticity to support variable resource demands. CSPs cannot deliver the required agility and scalability if they do not adopt modular systems, such as cloud and microservices technologies, and highly scalable infrastructures such as container technologies (Kubernetes, Dockers, etc.).

Faster time-to-market On the time-to-market front, CSPs are continuously facing the need to reduce the time required to launch new services. Time-to-market pressure is driven by three key factors: the speed with which competitive offers are brought to market by both other

telcos and internet players, the customer expectation in terms of immediate relevant offers, and the time required for CSP to launch a new service. While the first two are directly modulated by the market, the third is under the CSPs control and must be reduced to achieve greater control over the cost of the end-to-end product launch process. Such reduction is the key enabler of a “fail-fast” approach that provides the ability to test and quickly discover the potential success or failure of a new product or offer in a live environment. This approach is important as it allows CSPs to make important decisions on investment follow-up earlier. Such challenges require a business empowered service creation environment that controls the time-to-market of the full process chain, from service design to deployment.


AutomationOperations automation and automatic orchestration of business processes are becoming crucial for services provided in all service lifecycle phases including planning, design, fulfilment, monetization and assurance. In this

context, convergent charging should be automatically deployable, scale automatically and self-heal in case of failure or dysfunction. In addition, convergent charging needs to integrate into the automation and orchestration framework of the operator as it can be involved in the provisioning and deployment processes.

Evolutionary approachMoving to a new generation network will require CSPs to operate in an evolutive environment that offers a seamless migration from 4G to 5G, while enabling the co-existence of both. It is reasonable to assume that 4G will coexist with 5G for up to ten years.

The timing of different stages of the 5G journey is somewhat uncertain, as is the potential uptake rate for new use cases and their adoption by the market. During the transition, new technologies may arise with many CSPs wanting to adopt them for the value they bring. For this reason, the system must be evolutive so that it can incrementally integrate emerging technologies.

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Amdocs RevenueONE

Amdocs RevenueONE is a cloud-native, open agile solution for monetizing 5G services, IoT and smart spaces, the digital ecosystem and the subscription economy. Amdocs RevenueOne is specifically designed to help you take full advantage of today’s emerging business models and be ready to capture every 5G revenue opportunity of tomorrow. Whatever new service you have planned - AR, VR, vehicle-to-vehicle (V2V) communications, remote healthcare, smart cities or industry 4.0 – our solution, gives you the agility to quickly launch new 5G offers for consumers and partners, open your ecosystem and enable complex business models.Amdocs RevenueONE is the future of telco monetization in the 5G world.Consumer or enterprise, multi-play, content or IoT, RevenueONE ensures operators capture every revenue opportunity of the digital economy and take the world of charging and billing to the edge.

RevenueONE includes the industry’s first 5G-ready convergent charging, with network slicing support, service-based interfaces and a distributed architecture. RevenueONE provides omni-convergent charging for all consumer and enterprise business models and IoT. It takes a revolutionary approach to billing, turning batch processes to realtime functions with real-time charge calculation, realtime spend view, advanced payment flexibility and subscription billing models. RevenueONE includes CatalogONE, a cloud-native business user catalog for pricing configuration, easy bundling, and openness to partners.

Amdocs also offers operators MarketONE, a modular platform that supports full partner lifecycle management. It comes pre-integrated with high-profile media services providers such as Netflix and Spotify, as well as a long-tail of choice partners. Also included is a complete set of subscription and identity management capabilities that simplify the end-user experience.

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Figure 3 - Amdocs RevenueOne, part of Amdocs CES

Amdocs RevenueONE

Postpaid

Self-service

Network Slice Isolation

Commerce Catalog

Cloud Native

Prepaid

Retail

Service Based Interface

Commerce

TMF Open APIs

Multiplay

CRM

Distributed Edge Architecture

Ordering

Microservices

Digital Life

Enterprise Portal

Intelligent Quota Allocation

Care

Open Source

OTT

Virtual Assistant

Hybrid 4G/5G

Sales Quote

Always on

IoT

Widget Library & APIs

B2B

Any Application

Wholesale NaaS API CloudLine of Business

5G Topology

Cloud Native Platform

Convergent Charging Realtime Billing Any Biller

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Solution highlightsAmdocs convergent chargingAmdocs Convergent Charging is a single real-time monetization engine that enables monetization of service provider offerings on top of 5G. It’s designed for all lines of

business, customer segments and payment types. In accordance with 3GPP Rel-15, Amdocs Convergent Charging supports converged online and offline charging, handling both 4G over Diameter and 5G standard Service-Based Interface. Events are rated in real time, quotas are dynamically allocated and CDRs are immediately available in both the billing system and downstream customer engagement systems. This enables an excellent customer experience whereby users can access an accurate status of their services at any time.

Furthermore, as exponential growth of data consumption has created the need for network proximity to achieve significant signaling and hardware footprint reduction, Amdocs Convergent Charging also offers a distributed deployment option where charging functions are accessed within local network data centers (edge).

Real-time billingAmdocs 5G Monetization includes real-time billing capabilities that turn billing from a batch function to a

real-time function. This provides real-time calculation of charges for one-time and recurring charges and makes them available for viewing a customer’s real-time spend. This also enables operators to shorten their end of cycle bill runs and drive faster time to cash.

Real-time billing also includes flexible payment methods like on-bill or subscription, as well as payment by credit card, online payment services (Amazon, Google, PayPal), loyalty points and more.

CatalogONECatalogONE is an advanced, unified catalog that handles both commerce and monetization. This empowers business users to create, implement and launch rich, innovative,

multi-sided offers from end-to-end, without the need for coding, all within minutes. It is designed based on business-oriented flows, and includes a library of productized templates, enabling high agility for 5G use case implementation and rating logic definition.

Amdocs MarketONEAmdocs MarketONE manages the entire lifecycle for the third-party digital services partners – including

content providers, cloud service providers, digital service providers and more. It enables service providers to integrate and resell third-party services to its own customers, as well as equip partners with network and business services to enrich their own offerings. The offering works in tandem with Amdocs Convergent Charging to ensure partner events are monetized effectively and that partners are provided with accurate, real-time information from the charging system.

Cloud architectureAmdocs 5G Monetization is built on cloud-native technology for maximum agility and openness to the digital ecosystem. Advanced technologies, including

containers, orchestrators, virtualization and microservices enable cost reduction, agility and velocity, with FOSS databases and tools utilization. Automatic elasticity enables dynamic allocation of resources, with always-on charging availability and service continuity for true business agility.

Amdocs 5G Monetization

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Market LeadershipContinuous leadership in digital monetization

Gartner IRCM Magic Quadrant

Global Revenue Management Market Share (Analysis Mason)

Global Billing Market Share (Frost & Sullivan / Stratecast)

Leader

Leader

#1

#1

#1

#1

Amdocs has a long track record of product innovation, including the use of open source in its solutions

Convergent Billing & Charging Vendor (Ovum)

Revenue Management Market Share (HIS Markit)

Stratecast APAC Telecom OSS/BSS Vendor of the Year

There is no question that Amdocs’ 35-year heritage of development and delivery of OSS/BSS products and professional services to the industry has made the company the OSS/BSS pioneer and consequently the bellweather of the industry.

A superb job at following market technology trends and anticipating their impact and challenges on telcos.

Amdocs 5G Monetization

Worldwide leadershipAmdocs is the recognized leader in the area of telecommunications and media operators’ monetization systems. We have been named a Leader in Gartner’s IRCM Magic Quadrant 8 years in a row and continue to lead the market share reports of major analyst firms such as Analysys Mason, Stratecast, Heavy Reading, IHS and more.

Amdocs Convergent Charging is in production at over 30 operators worldwide, supporting over a billion subscribers and handling unprecedented performance demands. This includes the world’s largest, most complex implementation supporting an expanding subscriber base of 190 million, handling 320,000 events per second, 4.5 billion events per day,1.5 billion charges per day and 15 million recharges per day – all on a single convergent system.

Our customers are leading the way in 5G deployments and our systems are already supporting 5G product monetization in markets from North America to South Korea.

We are the undisputed leader in telecom monetization because this is what we do: we turn technology into revenue.

To learn more about how service providers can effectively monetize 5G, go to www.amdocs.com/monetize-5G.

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http://www.amdocs.com/monetize-5G

amdocs.com

turning technology into revenue

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