PPS - Prepaid Services Definition A prepaid service, as the...

Info iconThis preview shows page 1. Sign up to view the full content.

View Full Document Right Arrow Icon
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: Prepaid Services Definition A prepaid service, as the name implies, is a telecommunications service for which the customer has paid in advance. Overview Prepaid services, probably one of the fastest- growing segments in the telecommunications industry, are in demand for numerous reasons: • • • • • • • • serve as an alternative to traditional telephone calling cards act as budget control for business and/or personal use facilitate travel to foreign countries allow for prepaid wireless services useful for business promotions offer alternatives in areas where residential service is difficult to obtain helpful in emergency situations provide options for customers with bad credit ratings This tutorial describes the needs fulfilled by prepaid service and addresses the network elements necessary to deploy the service. Topics 1. Introduction 2. Where the Market Is Going 3. Available Platfo rms 4. Pros and Cons of Available Platforms 5. Call Flow and Call Scenarios for Prepaid Cards 6. Basic and Enhanced Features 7. Management Issues Self Test Correct Answers Glossary 1. Introduction With competition at its height and new services being created virtually every day, the telecommunications market is just exploding. Though very few services— prepaid services not included—hit the ground flying, there are several good reasons for the new services market to be hot... Deregulation Deregulation has played a very important role in the telecommunications industry. Since 1984, the players in the industry have changed dramatically; whether they have been successful in the marketplace or went under is still a matter of competition and its impact. Time to market, price wars, and addedvalue services are the main strategies deployed by companies in the new environment. Technological Advancements The introduction of advanced intelligent networks (AINs) has been a major step forward in terms of developing new services outside the switch/central office (CO). Before AIN, all services were tidily coupled with call processing. With AIN, the major paradigm change has been the decoupling of call processing and service-related intelligence. In the new network, service intelligence now resides in other network elements. This new concept opened the gates to new service offerings and new network designs. In this new context, service providers have the capability of adding new services based on a variety of adjuncts, services nodes (SNs), and intelligent peripherals (IPs). Web ProForum Tutorials http://www.iec.org Copyright © The International Engineering Consortium 2/17 Figure 1. Technological Advancements Customer Demand As the availability of information increases, so does the level of customer expectations of service providers. Customers, not limited to a single service provider, have the option of switching if the providers do not meet their requirements. Socioeconomic Requirements The socioeconomic environment is also having an impact on the services required by the market. In this day and age, the haves and the have-nots are segments becoming increasingly segregated. Good credit versus bad credit has become an accepted part of life. On another note, trends such as market globalization necessitate more business meetings; faster, more ubiquitous communication; and control of costs associated with travel. 2. Where the Market is Going Many analysts predict that prepaid services, a business that includes both wireline and wireless prepaid services, will become a multi-billion-dollar business. For the wireless service alone, Yankee Group predicts a $2.2 billion revenue by the year 2002. Already, the market is estimated to be worth more than $1 billion. Web ProForum Tutorials http://www.iec.org Copyright © The International Engineering Consortium 3/17 Table 1. Telecard Figures from 1992 to 1997 and Telecard Forecast from 1997 to 2000 Year Low Actual High 1992 12 million 1993 65 million 1994 325 million 1995 650 million 850 million 1996 1.1 billion 1.4 billion 1997 1.45 billion 1.8 billion 1998 1.75 billion 2.2 billion 1999 1.9 billion 2.6 billion 2000 2.0 billion 2.9 billion This market can be segmented in different ways: • end-user preference—can range from high quality regardless of price to low price regardless of quality • end-user psychographic make-up/lifestyle segmentation—For example, in the US, it is estimated that one out of every four people is not granted telephone service due to poor credit rating. • demographic segmentation—For example, in cities with large ethnic populations, the demand for cheap, controlled phone services is high. • technological segmentation—wireline versus wireless • geographical segmentation—domestic versus international; internationally, according to one report, prepaid wireless represents over one-third of all prepaid service and can grow to exceed 50 percent of subscribers; assuming just 15 percent of subscribers globally, revenues should surpass $20 billion by the year 2000 Regardless of how the pie is sliced, the industry shows a growing demand, reflected by the multitude of providers. A fact that brings up this question: How soon will the margins erode due to the level of competition? The answer must be provided both by the service providers' planning as well as by the platform providers, who need to show that the platform on which the prepaid service is being offered can deploy other revenue-generating Web ProForum Tutorials http://www.iec.org Copyright © The International Engineering Consortium 4/17 services and that the platform is scalable, up or down, to fit the needs of particular locations. 3. Available Platforms There are basically three prepaid service equipment configurations available— personal computer (PC) platforms, switch platforms, and service-node platforms. PC Platforms Figure 2 shows a typical PC–based platform configuration. PC platforms for prepaid services are based on a file server, a card processor, a workstation, telephone interface cards, and a local-area network (LAN). On most systems, T1s terminate at the card processors. Figure 2. Typical PC–Based Configuration Switch Platforms Figure 3 represents a typical switch-based platform. A single switch will typically have interactive voice response (IVR) resources, together with a workstation necessary for administration purposes. Web ProForum Tutorials http://www.iec.org Copyright © The International Engineering Consortium 5/17 Figure 3. Typical Switch-Based Configuration Service-Node Platforms As shown in Figure 4, the service-node configuration is generally comprised of a set of functions mapped to one or more network components. The functionalities are basically call processing, specialized resources, and database capabilities. In addition to these functions, associated with a service-node configuration is an administration workstation with service-creation capabilities. Figure 4. Typical Service Node-Based Configuration 4. Pros and Cons of Available Platforms No matter what option a service provider may choose, both technical and business aspects must be considered before a purchase decision is made. This section describes some of the technical factors to be considered when selecting a platform. Web ProForum Tutorials http://www.iec.org Copyright © The International Engineering Consortium 6/17 PC Platforms PC–based systems have the advantage of being modular and low in cost. For an entrepreneur entering the prepaid services business, PC platforms offer a costeffective solution, as they allow the entrepreneur to start with a single PC and then add systems as the business grows. In addition to being modular and scalable, PC–based systems are usually easy to customize. The disadvantages of PC–based systems are that multiple PCs become increasingly difficult to manage as the number of clients and the volume of calls increase; reliable network operations are not always possible; and there are limitations to call capacity. Switch Platforms Switch-based platforms usually have higher call capacities and offer reliable network operations as well as centralized control for call processing. The disadvantages of switch-based platforms are that all calls must be transported to a central point for voice treatment and processing, purchase points are often higher than the PC–based platforms, and they are often not flexible enough to allow for customization. Service-Node Platforms Service-node platforms usually have larger switching capacity, reliable network operations, centralized control, and a modular architecture that can grow with call volume. In addition, they can be easily customized due to the fact that they come with a service-creation environment. The disadvantages of service-node platforms include their higher purchase price and high cost for low-volume operations. 5. Call Flow and Call Scenarios for Prepaid Cards In general, prepaid card calls have the following generic call flow (see Figure 5): Web ProForum Tutorials http://www.iec.org Copyright © The International Engineering Consortium 7/17 Figure 5. Basic Call Flow • The platform receives an incoming call. • The platform offers the caller a signal or message to enter the prepaid card number. • The platform offers the caller a signal or message to enter the destination phone number. • The platform rates the call and verifies the prepaid card has adequate balance to place the call. • The platform dials the outgoing call to the destination phone number. • Upon answer, the platform bridges the incoming and outgoing calls. • The platform rates the call and debits the card. • The platform provides configurable signals or messages to the calling party indicating exhaustion of the prepaid card. Web ProForum Tutorials http://www.iec.org Copyright © The International Engineering Consortium 8/17 6. Basic and Enhanced Features Prepaid services should have certain basic features as well as some enhanced features for value-added, money-generating options. Of course, there are various factors—such as whether marketing is done at a retail or wholesale level—that play a role in influencing requirements. It is helpful to consider first the various ways in which basic prepaid service can be offered: • as a one-time-use prepaid card in which after the amount is consumed, there is no warning and the call is dropped • as a one-time-use prepaid card in which one minute prior to the complete amount being spent, there is a warning • as a rechargeable prepaid card in which there is a warning and, at the same time, the option of recharging The basic features required of a prepaid-card service provider include the following: • multiple issuers • multiple card types • multiple rate schedules and customized modifiers • fraud protection • origination blocking • destination blocking • reports • provisioning and customer-care interface • tax rating • ability to charge different legs of a call • billing. Enhanced features that could make prepaid cards more attractive to users include the following: Web ProForum Tutorials http://www.iec.org Copyright © The International Engineering Consortium 9/17 • rechargeable option • customized messages • customized calling areas • multiple-rate schedules and customized modifiers • multiple languages and automated language selection • fraud protection • fixed-number auto-dialing • automatic expiration date • warnings • user-friendly management of personal identification numbers (PINs), activation, deactivation, and recharge • conferencing • voice mail • call forwarding • pager notification • message delivery • fax, fax store, and fax forward • information services 7. Management Issues Prepaid services constitute a very different business case than other telephony services, so service providers need to manage carefully the business, network, technical, and customer-care aspects of the business. The following issues should be considered from a business perspective when deciding whether or not to become a prepaid-card service provider: • margins on which the business case is built Web ProForum Tutorials http://www.iec.org Copyright © The International Engineering Consortium 10/17 • amount of negotiation needed with the carrier for the inbound and outbound circuits • overhead needed to be built in order to be able to come up with the rate charged per minute • whether the service is provided wholesale or retail through owned distribution channels • billing capabilities that must include consideration of issues such as taxes and carrier reconciliation Issues that should be considered from a network perspective include the following: • call volumes, which play a large role in determining the type of platform required • the number of circuits inbound and outbound, the number of circuits reserved for external sources (e.g., information services), and the number of circuits reserved for IVRs • growth rates, because if the number of call minutes is growing very fast, maximization of revenues entails expanding the platform to keep it ahead of growth; for instance, if the platform was built to support 10 million call minutes and has reached this number very fast, then there will be a period in where there is demand for more, the service provider will not be able to provide the service Issues to be considered from a technical perspective include the following: • average call duration • busy hour factors • transactions per call • number of cards • number of active users • average-usage prepaid cards Issues to be considered from a customer-care perspective include the following: • It is important that the customers of a prepaid service are wellmanaged and that expectations are set up correctly. If customers are Web ProForum Tutorials http://www.iec.org Copyright © The International Engineering Consortium 11/17 not being well-managed, there may be problematic scenarios. For example, the platform owner may be wholesaling minutes on the platform, and the buyer of the minutes may be pushing more minutes than he bought. In this case, the platform owner has two problems at hand—the first is unhappy customers who were unable to complete their calls—and the second is customers who need to be managed in such a way that what has been sold matches what has been bought. • It is also important to consider the time required to set up a call. This issue can also be regarded as a network issue, as it relates to the type of circuits being negotiated with the carrier and can also be regarded as a business issue as it relates to the overhead that needs to be built in. Self-Test 1. Demand for prepaid services is increasing. a. true b. false 2. Demand for wireless prepaid services is decreasing. a. true b. false 3. Prepaid services can only be offered using a switch-based platform. a. true b. false 4. Service node-based platforms offer larger call-volume capacity than other types of platforms. a. true b. false 5. Rating for debiting purposes is done post-call. a. true b. false Web ProForum Tutorials http://www.iec.org Copyright © The International Engineering Consortium 12/17 6. Recharging of a prepaid card is not an option available to customers. a. true b. false 7. Users of a prepaid service cannot call more than one person at a time. a. true b. false 8. Taxes are not an important aspect of the business for a service provider. a. true b. false 9. When considering a prepaid services platform, call volumes should be taken into consideration. a. true b. false 10. Call setup time is important for a prepaid service environment. a. true b. false 11. Which of the following is a reason for prepaid services to be in demand? a. budget control for business and/or personal use b. business promotions c. both of the above 12. Which service-equipment configuration is based on a file server, a card processor, a workstation, telephone-interface cards, and a LAN? a. PC–based platform b. switch-based platform c. service node-based platform Web ProForum Tutorials http://www.iec.org Copyright © The International Engineering Consortium 13/17 13. Which platform is not flexible enough to allow for customization? a. PC–based platform b. switch-based platform c. service node-based platform 14. Which of the following is generally considered to be an enhanced feature of prepaid service? a. customer-care interface b. fraud protection c. call forwarding 15. Which of the following is an issue considered from the network-management perspective? a. profit margins b. average call duration c. call volumes Correct Answers 1. Demand for prepaid services is increasing. a. true b. false 2. Demand for wireless prepaid services is decreasing. a. true b. false 3. Prepaid services can only be offered using a switch-based platform. a. true b. false Web ProForum Tutorials http://www.iec.org Copyright © The International Engineering Consortium 14/17 4. Service node-based platforms offer larger call-volume capacity than other types of platforms. a. true b. false 5. Rating for debiting purposes is done post-call. a. true b. false 6. Recharging of a prepaid card is not an option available to customers. a. true b. false 7. Users of a prepaid service cannot call more than one person at a time. a. true b. false 8. Taxes are not an important aspect of the business for a service provider. a. true b. false 9. When considering a prepaid services platform, call volumes should be taken into consideration. a. true b. false 10. Call setup time is important for a prepaid service environment. a. true b. false 11. Which of the following is a reason for prepaid services to be in demand? a. budget control for business and/or personal use Web ProForum Tutorials http://www.iec.org Copyright © The International Engineering Consortium 15/17 b. business promotions c. both of the above 12. Which service-equipment configuration is based on a file server, a card processor, a workstation, telephone-interface cards, and a LAN? a. PC–based platform b. switch-based platform c. service node-based platform 13. Which platform is not flexible enough to allow for customization? a. PC–based platform b. switch-based platform c. service node-based platform 14. Which of the following is generally considered to be an enhanced feature of prepaid service? a. customer-care interface b. fraud protection c. call forwarding 15. Which of the following is an issue considered from the network-management perspective? a. profit margins b. average call duration c. call volumes Glossary AIN advanced intelligent network CO central office Web ProForum Tutorials http://www.iec.org Copyright © The International Engineering Consortium 16/17 IP intelligent peripheral IVR interactive voice response LAN local-area network PC personal computer PIN personal identification number SN service node Web ProForum Tutorials http://www.iec.org Copyright © The International Engineering Consortium 17/17 ...
View Full Document

Ask a homework question - tutors are online