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How Do Telecom Billing Systems Work?

21st December 2020  by Union Street

Customer relationship management and telecom billing are significant components of any communication provider (CP) business, and no CP can operate without efficient and accurate customer billing. Telecoms billing systems are excellent software solutions for managing the services delivered by CPs.

Primary Purpose

A billing system’s primary purpose is to manage the billing of end users for the services they’ve consumed, to automate many of the labour-intensive tasks involved in the billing process, and to optimise efficiency whilst saving time and money.

The software can calculate, generate and dispatch bills to each customer based on their consumption of services and help to monitor payments and debt collection issues. Bills will typically include rateable charges for voice and connectivity services but, due to the ever-expanding range of services offered by CPs, it may also include charges for IT services, one off charges, support, consultancy, software licenses, hardware costs, and much more.

When it comes to voice and connectivity services, billing systems will process usage data based on the call detail records (CDRs) that are created each time a customer uses a communications network to place a call, send a text, access the internet, and so on. They will then rate this usage according to customers’ tariffs to calculate costs incurred over the billing period (typically a month).

In addition to calculating the cost of services used by customers, billing systems should monitor the costs of services that the CP is purchasing from its suppliers. This will involve checking that all supplier charges are accurate and in accordance with agreed costs. A billing system will also provide revenue assurance by checking that all supplier costs have a corresponding charge in a customer’s bill, ensuring that nothing is missed and alerting the CP of any loss-making services.

Service provisioning

A billing system such as Union Street’s aBILLity, can also assist with the process of ordering new products and services for a customer (better known as the provisioning process). For example, if an end user requires a new fixed line to be installed at their premises, a CP can use aBILLity to provision this service from Openreach or another supplier. Any associated charges such as engineer visits and setup costs are then automatically added to the customer’s account ready to be billed when the service goes live without the need to duplicate this data in a separate system.

Managing back-office processes

Telecoms providers can face a difficult task when managing high volumes of users and large customer bases. Typical back-office processes might include adding new customers; provisioning services; recording customers’ network usage; calculating and issuing bills; taking payments and chasing up non-payments; removing old customers; and more. Telecoms billing systems add value by helping to automate and manage these and other processes that would otherwise be repetitive, high-frequency, time-consuming and very labour-intensive.

For example, if a CP were to manually bill a customer for use of a mobile phone, they would first need to collate that customer’s usage of voice and data services over the course of the billing period. They would then need to rate that use against the customer’s tariff. Depending on the complexity of the tariff, they might need to take into account free minute plans, bundled texts and data services, variable destination costs and so on. Doing this for one customer may not be too hard, but doing it for thousands would require considerable resources, and CPs will usually provide many more services to a customer than a single line.

Instead of being reliant on a huge team of back-office staff to manage these processes manually, CPs can rely on telecom billing systems to automate the process while reducing the risk of human error. Through APIs, billing systems can also be integrated with other back office systems to centralise data, increasing productivity levels and removing the need for employees to re key information between systems.

Revenue optimisation

Billing systems offer complete automation of many time-consuming tasks and can digitise invoices, statements and emails, helping your staff to save valuable time. Billing systems can also provide valuable business intelligence and powerful reporting tools which can help to identify the most profitable products and services. This in turn can be used to focus business development strategies to optimise revenue streams.

In summary

The telecommunications industry continues to expand rapidly thanks to continuous changes to technology and consumer behaviours. Many CPs are faced with significant opportunities, but also significant challenges for how to scale up operational processes such as data management, maintaining business agility, improving efficiency, and introducing new products and services. Adopting a billing system can help telecom service providers to overcome the many challenges they face on a day-to-day basis and give them a competitive edge.

Ready to take your telecoms billing to the next level? Find out more about our award-winning aBillity billing system.

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