The UK has a thriving telecoms market, but research estimates that one in three consumers aren’t aware of the choices available and so miss out on potential price savings and services on offer from different telephone companies (David Edmonds, Director General OFTEL, OFTEL press release, Feb 2000). This is not surprising when research by Southampton University estimates that there over 1 billion separate combinations of network tariffs and handsets for mobile phones alone in the UK. (Marketing Direct, May 2000; Professor Williams, Southampton University)

In addition to the complexity of the telecoms market, business users identify many deficiencies in billing, either in the level of detailed information provided, or the accuracy. Likewise the headache exists on the supply side of the industry with service providers struggling to deliver the billing and management information that corporate users demand.

It seems likely that problems with billing will increase as new technologies emerge, other technologies converge, and the industry progresses with deregulation.

Approaching from a Different Angle

If organisations took more notice of their telecoms bills then maybe some of the mysteries would be resolved and the complexity could be deciphered. 

Both sides of the supply chain often see the bill as end of a process, a statement of past events - that of an organisation renting lines and making calls. The corporate budget holder usually gives the bill a cursory glance, and if the amount looks ‘about right’ or what was expected, the bill makes it’s way to the accounts payable section where it gets paid in the normal course of business events. The supplier takes a similarly simplistic view of events, it’s the end of one cycle, the start of another.

However the amount of information that can be gleaned from telecoms billing with the correct analysis is immense. Those businesses and suppliers who access and analysis the information gain a distinct advantage over those that don’t.  Only those who understand their bills will ever know how their organisation communicates and whether the company enjoys the best tariffs.

Corporate users can use the information not only to establish if they are on competitive rates but also understand how their business communicates.  How much the organisation spends, precisely how is it spent, and with which suppliers, how different sites communicate, are there enough lines, how many times does the company communicate with key customers, when are the peak times, etc.?

The effect of a reduction of, say 20%, in the cost of telecommunications can make a significant contribution to the bottom-line and is usually easier to deliver than IT personnel within the organisation would like to think.

Likewise network operators and service providers can gain advantages over their competitors by understanding the information contained within the bills of their current customers and future sales prospects.  They can use customer billing information to present an insight into a clients telecommunications profile, show how much their tariffs would save an existing or new customer, ensure that they are getting the maximum share of business in a shared account, and that they are billing the customer accurately.

The use of competitor billing to identify business opportunities is not new, however, the available technology has significantly enhanced functionality compared with what was available even 6 short months ago.

Analysing Bills

There are basically two options available to organisations that wish to carry out a systematic review of telecoms costs, ‘do-it-yourself’ or ‘ask an expert’. Few business users have the internal resources, tools or knowledge to carry out a thorough review themselves and rely on external help, in one form or another…but beware!

In-house

There are an increasing number of tariff libraries, usually on-line, which can be used to compare your tariff with others.

However, you need to be aware that often the libraries contain only published or standard tariffs, and that most providers have bespoke tariffs for corporate users which will not appear in such libraries.  In addition, knowing what tariffs are around is interesting but only becomes useful when applied.  Few large business can re-rate hundreds of thousands of calls against a variety of different tariffs. (Two such libraries are phonebills.org.uk and telecomsadvice.org.uk, though it should be noted that these are largley focused towards residential and small business uesers)

External

There are many suppliers and ‘consultants’ in the market place promising to reduce costs but often this involves changing supplier, installing new equipment and taking a gamble with new service level agreements.  Many have no technology to apply to the task, and some so called ‘independent consultants’ are simply agents for a limited range of suppliers.

If you’re going to enlist support from an external consultant, ensure that they are truly independent, they have a high calibre client base, and the technology to apply to the task.

The Future

A software application that performs automatic billing checks, tariff verification, and cost centre analysis is no longer the stuff of dreams.  New software developments from specialist companies make it possible to analyse bills and deliver accurate, user friendly information and benchmark an actual call profile against a variety of alternative tariffs to see what savings could be achieved, either by changing supplier or by staying with the same supplier but optimising tariffs.  

As communications become more and more important businesses will need to identify what they spend, how they can get more from their existing supplier, what other tariff choices exist and ultimately how they can reduce their costs for rental charges, in bound traffic, mobile phones, data networks, maintenance charges and outbound traffic.  

Likewise suppliers will need to retain current customers and win new ones, to survive in the market, as users become more sophisticated both in their demand for services and their understanding of their costs.

So wherever you are along the supply chain its time to take a really long look at billing and start using the information trapped inside. If everyone understood the price, then decision making can be based solely on service, content and brand, and the elusive ‘value add’ can be qualified.

Sally Edwards works for Informed Telecom, a UK based company which creates software that provides information on telecoms management and cost to companies and to leading services providers.

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