The Key to Increasing Data Revenues: Giving Customers What they Want
Dynamic Services is a platform for creating, displaying and charging for mobile services. A key part is the service / price plan creation and providing expanded services with innovative pricing. Supplementing a base service plan with value added services chosen by the subscriber enables a wide range of value based offers to be delivered to a wide range of segments with different preferences. Operators implementing a Dynamic Services strategy have seen increased ARPU, profit margin growth and improved customer satisfaction. Here are some examples of Dynamic Services and the returns:
A Canadian operator launched data service passes to increase data adoption. They wanted to remove the uncertainty over data costs by offering fixed volume, fixed duration data access (e.g. 60MB for 1 week for $5). The result: In the 60 days post launch this operator converted 15% of data pass users to a recurring post-paid data plan and cut billing credits by 98%. In addition the operator was able to reduce the number of calls into customer care by 120,000 per year. This significant cost saving and revenue increase is mainly down to providing a more transparent and easier way for customers to understand how much data they are using and remove uncertainty.
An operator in the Middle East felt that they were missing a revenue opportunity from roaming traffic, due to many customers switching off data when roaming. By offering data roaming service passes, whereby a customer buys a fixed volume of data roaming access for a fixed duration this operator saw an increase of 35% in data roaming revenues.
Multi-device shared bundles are now standard for several operators, Verizon have changed their reporting metric from ARPU to ARPA (average revenue per account) due to the fact that they see that an account can have multiple devices. In the six months since launching shared device plans in June 2012 Verizon now have 23% of the post-paid base using shared device plans. Likewise AT&T reported a healthy growth in multi-device data share plans in their Q4 2012 results.
A European operator offers ‘add-ons’, speed and data volume over and above base plan, and music, TV and cloud based options. The results: This operator is seeing 25% data ARPU increase (yoy 2010- 2011), churn rate in subscribers to their cloud services at 25% less than average, and 10% of customers subscribing to additional data options. As well as driving 5%-10% of additional EBITDA, these advances are also enabling this operator to enjoy a higher % of data revenues than their competitors.
There are many more examples of dynamic services being launched in the market on a regular basis. What is consistent is that they need real-time charging and monetization, and policy is now being used to help develop products to increase revenues, as well as control costs. Real-time charging integrated with policy is now a given in providing the foundation for data offers. Operators are now evolving this to the next stage and delivering engagement with the policy and charging control infrastructure direct to subscribers, who can view and purchase services, and to content providers, with controlled access to Policy and Charging functions.
PCC integrated with a real-time engagement capability is the key to operators delivering a Dynamic Services strategy and giving customers the choices needed to let them spend their money with you on the services that they want.