INSIGHTS

RESEARCH

July 2015 | www.tmforum.org

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RTCC AND POLICY:

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Page 4
Executive summary
Page 6
Section 1
The role of policy control and RTCC in a changing digital
landscape
Page 8
Section 2
Combining policy control and RTCC: Why, how and how
hard?
Page 13
Section 3
Service providers progress, projects and perspectives
Page 24
Section 4
Conclusions and recommendations
Page 28
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RTCC AND POLICY:

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Executive summary
When it comes to charging systems, one size
doesnt fit all not for service providers, and
not for their customers. That statement sums
up the major reason why so many wireless
carriers, cable operators and other service
providers are investing heavily in real-time
convergent charging (RTCC) and policy-control
solutions.
TM Forum recently surveyed more than
two dozen service providers worldwide about
the status of their RTCC and policy-control
projects, the strategies behind them, their
implementation challenges and long-term
goals. One key finding is that both technologies
provide operators and their customers with
flexibility and savings that legacy systems
simply cant deliver.
Benefits of self-service to all parties
Research by suppliers such as Nuance
Communications show that consumers
overwhelmingly prefer self-service over
alternatives in a variety of verticals: RTCC and
policy-control solutions enable service providers
to do a better job of providing self-service.
When they do, their bottom lines benefit,
such as reduced overhead because contact
centers can have lower staffing levels.
Customers further benefit because when

they want or need a live agent, members of

staff now have more time to spend with them
instead of rushing to the next call or chat.
More competitive options
RTCC and policy control also give service
providers more pricing flexibility and thus more
competitive options. For example, instead of
presenting customers with a rigid, limited set
of data plans such as 1Gb, 5Gb and 10Gb
mobile operators can allow customers to create
a bucket in which the elements more closely
align with actual usage.
RTCC and policy-control platforms can
provide customers with historical usage
information so they can see that, for instance,
selecting a 500Mb plan means they wont be
wasting money on unused Gigabytes.
This flexibility sends a message that the
operator puts the customers budget ahead
of its own bottom line, although the operator
certainly benefits in ways such as reduced
churn and bad debt.
An operator could also use RTCC and
policy-control platforms to allow customers
to change plans every month or, as the billing
cycle winds down, the ability to reallocate
money spent on data toward minutes when
that bucket is nearly empty.

RTCC and policy control give service providers more pricing flexibility and thus more
competitive options. For example, instead of presenting customers with a limited
rigid set of planscustomers can create a bucket that aligns with actual usage.
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INSIGHTS RESEARCH

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Flexibility enables operators to cater to customers with a

limited budget, or a budget that varies significantly by month

In all of these scenarios, this flexibility

also enables operators to cater to customers
with a limited budget, or a budget that varies
significantly by month a valuable tool in
todays hypercompetitive market.

several TM Forum Catalyst initiatives with

RTCC and policy components, and shows
how and why operators can use them to
maximize the return on their RTCC and policy
investments.

Whats driving RTCC?

This report analyzes these and other factors
driving the RTCC and policy-control markets
and assesses how these technologies fit into
the larger digital landscape.
Section 1 provides an overview of RTCC and
policy control, including existing and potential use
cases. One example is using RTCC with policy to
provide a wider variety of data plans for machineto-machine (M2M) and Internet-of-Things (IoT)
applications, whose notorious price sensitivity
has limited that markets enormous potential.
Section 2 explores why and how service
providers are using or considering using RTCC
and policy control to boost their bottom lines
and competitive positions.
It also looks at issues such as when RTCC
and policy control should be integrated
and when they should operate separately.
For example, although ensuring a smooth
technological integration is important, its a
mistake for service providers to overlook the
role of cultural integration.
The discussion includes an overview of

The service providers speak

The research and analysis from our global
survey augmented by in-depth interviews of
both vendors and solution providers is laid out
in Section 3. It covers the status of sservice
providers deployments, spending, strategies
and benefits both realized and anticipated.
The survey results are also compared to
those from two previous, similar TM Forum
studies conducted in December 2012 and
March 2014.
One consistent finding is that service
providers overwhelmingly agree that RTCC
and policy-control solutions are must-haves for
maximizing their competitiveness.
Another recurring theme is that a variety of
integration hurdles stand in the way, creating
opportunities for suppliers to offer professional
services to overcome those barriers.
Section 4 summarizes the key findings
from the service provider survey and supplier
interviews. It also provides recommendations
for developing and executing strategies that
center around RTCC and policy control.

A variety of integration hurdles stand in the way, creating opportunities for

suppliers to offer professional services to overcome those barriers.
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RTCC AND POLICY:

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Section 1

The role of policy control and RTCC

in a changing digital landscape
As its name implies, real-time convergent charging
(RTCC) consists of management, rating and
charging systems linked to a service providers
business support systems (BSS). Another way
of describing it is as a set of sophisticated new
tools for managing revenue. The latter description
sounds simple, but RTCC fundamentally
changes how service providers do business.
A major reason for this change is the ubiquity
of IP. As more services become all-IP, it
becomes easier and more attractive to enable
convergent products. Policy-control systems
play a role by, for instance, giving customers
the ability to personalize their own packages,
including what they pay for them, rather than
having all of that dictated by the operator.
Two examples are the ability to create their
own data buckets and then reallocate data
funds to voice or messaging during the course
of a billing cycle if those services are running
out. In that context, the concept of policy will
become much more important for customers
to control their experience, one TM Forum
survey participant said in a follow-up interview.
RTCC takes flexibility to a new level
RTCC is a successor of sorts to the Online
Charging systems (OCS see Figure 1-1) that
replaced the Intelligent Network (IN) systems.
Mobile operators implemented IN systems
largely in order to offer prepaid services
and tap a segment of the market that was
inadequately served by postpaid offerings.
OCS is part of the IP Multimedia Subsystem
(IMS) architecture and includes Policy Charging
Control (PCC) components such as the Policy
and Charging Rules Function (PCRF), and Policy
and Charging Enforcement Function (PCEF).
OCS debuted as a way for mobile operators
to better accommodate data services in terms
of quality of service (QoS), type, bandwidth
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INSIGHTS RESEARCH

Figure 1-1: The online charging system, looking north and south
IMS CSCF

SMS node

Ro

MMS relay/
server

MBMS server

PoC server

Ro

Ro

GMLC
Ro

Ro

IMS AS

IMS MRFC

Ro

ISC

WLAN

IMS gateway
function

Ro

Ro

SGSN

P-GW/PCEF

Ro

CAP

Ro

MSC
CAP

Online charging system

Online
charging
functions

Event based
charging function

Session based
charging function

Re

Ga

Rc

Rating
function

Changing
gateway
function

Account balance
management
function

Bo

Sy

Rr

Operators
post-processing
system

PCRF

Recharging
server

Source: 3GPP

and other factors. These systems set the stage

for mobile operators to be more flexible in the
way they price and deliver services, including
the ability to partner with third parties in
arrangements such as sponsored data.
RTCC takes that flexibility to a higher level.
Some suppliers interviewed for this report say
they are increasingly interested in virtualizing
PCRFs, and this is becoming a strong trend.
Must-haves to compete
RTCC and policy control are must-haves
for service providers to be competitive and
profitable as the digital landscape evolves.
They themselves overwhelmingly agree that
when implemented separately or integrated,
RTCC and policy control enable services,
promotions, competitive advantages,
www.tmforum.org

For suppliers, the message is their sales and marketing should

focus on self-service capabilities to meet their customers top priorities

customer management, self-service, time

to market, revenue opportunities and other
benefits that would be difficult or impossible
to achieve with traditional systems.
This consensus is demonstrated by the
amount service providers have already spent
on implementing those systems and how
much more they anticipate budgeting.
Old habits die hard no single strategy
Old habits and infrastructures die hard,
which is why service providers typically
operate their new RTCC and policy-control
systems alongside legacy, offline charging
and other systems. Service providers also
may choose to initially keep their policy and
charging systems separate before eventually
integrating the two domains.
These choices are examples of how theres
no single strategy and architecture that
applies to every service provider.
Bill shock is a major reason why service
providers particularly mobile operators
are deploying RTCC/policy-control solutions.
Although this is important, its useful to view it
partly as a self-service application something
service providers want to offer for two reasons.
First, surveys by suppliers such as Nuance
Communications1 have found an overwhelming
consumer preference for self-service not just
in telecom, but in verticals such as banking.
This sets the stage for the second reason:
When customers can help themselves, service
providers have lower overhead costs, such as
fewer staff in call centers.
Not just cool, but essential
I dont think self-service is a cool option,
one 2015 survey participant says in a followup interview. Its a must. This assessment
mirrors feedback from previous TM Forum
www.tmforum.org

research. For example, a December 2012

survey asked service providers to identify
the capabilities they hope to add or improve
with RTCC. Customer self-care was the top
response, which shows that this has been a
goal for a long time and hasnt since taken a
back seat. So for suppliers, the message is
that their sales and marketing should focus on
self-service capabilities to address one of the
customers top priorities.
Competitive benefits
There are also competitive benefits. Selfservice enables mobile operators, for
example, to offer dynamic pricing rather than
making customers pick from a rigid, limited
set of data plans. RTCC and policy control can
be ways to provide customers with usage
analytics so they can select the plan thats
least likely to result in bill shock.
Mobile operators also can go a step further
to allow customers to create their own plan,
such as setting their own data caps. Its
about putting the power in the hands of
the end subscriber to define their personal
package, says David Fielding, Senior Product
Marketing Manager, AsiaInfo.
RTCC/policy control also can be used to
enable customers to transfer spending across
multiple services. Suppose a mobile customer
is approaching the end of their billing cycle
and has a lot of leftover minutes but little
data. With self-service, that person could have
that data converted into minutes, with the
operator possibly charging a nominal fee for
the transfer.
It is widely held view that customers are
happier if they feel theyre in control of
the service rather than it being dictated by
the operator, and not closely meeting their
individual needs.

1 http://bit.ly/1HPKwHt

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RTCC AND POLICY:

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Section 2

Combining policy control and RTCC: Why, how and how hard?
Service providers often integrate policy-control
and RTCC platforms to achieve business
benefits. The December 2012 TM Forum
survey asked service providers to describe
the importance of a fully integrated charging
and policy approach the results are shown in
Figure 2-1. Fifty-eight percent said it was very
important, and another 33 percent said it was
important and part of their implementation plan.
In the 2014 survey, 53 percent of respondents
said theyre implementing RTCC and policy
solutions at the same time. Eighty five percent
agreed or strongly agreed that they must be
integrated to be effective see Figure 2-2.
For example, a cable or telco TV provider
could combine RTCC and policy to monetize a
partnership with an over-the-top (OTT) provider.
Or a mobile operator could use them to enable
sponsored data packages. The possibilities are
endless, which shows why so many service
providers are investing in both technologies.
Separate means to different ends
However, its important to note that service
providers also frequently view RTCC and policy
as separate means to different ends. For
example, one major U.S. cable operator that
participated in the 2015 survey discussed how
it is considering using policy to give customers
tools for prioritizing traffic. This operator wants
to sell home security services, and the policy
platform would enable customers to give the
associated devices traffic priority over traffic
from all other devices they buy from the
operator.

Figure 2-1: Importance of a fully integrated charging and policy approach

Very important
9%

Important and part

of our plan
Somewhat important
Not important

33%
58%

Source: TM Forum, December 2012

Figure 2-2: Integration of RTCC and policy management

RTCC and policy management must be integrated to be effective

Strongly agree

3%
12%

Agree
Unconvinced
Disagree
55%

Strongly disagree (0%)

30%

Source: TM Forum, June 2014

This operator wants to sell home security services, and the policy
platform would enable customers to give the associated devices traffic
priority over traffic from all other devices they buy from the operator.
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INSIGHTS RESEARCH

www.tmforum.org

Policy benefits the operators bottom line by

making efficient use of expensive network resources

Another potential scenario is health care,

where the patient or caregiver could prioritize
traffic from monitoring devices.
The same operator also envisions policy
as a way to shuffle traffic between Wi-Fi
and cellular, with or without the customers
involvement. In this scenario, policy benefits
the operators bottom line by making more
efficient use of scarce, expensive network
resources, including those provided by third
parties such as a cellular partner. Policy is
really key in how the industries of connectivity
and communication [are] evolving over the next
few years, this operator says.
More centralized control in the cloud
Finally, the operator also sees policy enabling
a shift in how network resources are deployed
and used. For example, it has a lot of
intelligence in the edge and access nodes.
We want to bring those controls more
centrally into the cloud so we can operate
those edge networks without having to
physically get into devices and apply different
configurations, the operator says. It all fits
our long term architecture: converged mobile,
Wi-Fi and fiber into an IP business ecosystem.
Some operators that participated in the 2015
survey said they were surprised by the amount
of money, time and effort required to integrate
their new RTCC and policy-control solutions.
Standards work helps somewhat in terms of
bridging the policy and control domains, such
as the Sy interface developed by the Third
Generation Partnership Project (3GPP).

Still hard to integrate

This interface connects the online charging
system (OCS) and Policy and Charging Rules
Function (PCRF). But simply selecting a
compliant solution doesnt ensure simple
integration. Theres still a lot of work
remaining. If an operator provides diversified
data packages which include policies based on
multiple usage or accumulation type, the Sy
interoperability testing (IOT) will be much more
complicated.
Another factor is that the database structures
and user models of the subscription profile
repository (SPR) and online charging system
(OCS) are different. As a result, extensive
customization is required to marry the two
platforms, making it difficult for operators to
integrate both systems smoothly and with
less cost because of the independent product
design principle.
This is one reason that operators wanting to
tightly integrate policy and charging platforms
will gravitate to a supplier that can provide preintegrated solutions. In addition, modular-based
solutions will be attractive because they enable
operators to choose to deploy charging first
and then deploy policy in next strategy phase
under the unified platform.
Safeguarding legacy billing systems
Service providers typically are reluctant to do
anything that could jeopardize legacy billing
systems performance and reliability. This
concern compounds the challenge of linking
with new RTCC and policy-control systems.

Modular-based solutions will be attractive because they enable

operators to choose to deploy charging first and then deploy policy
in next strategy phase under the unified platform.
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INSIGHTS RESEARCH

RTCC AND POLICY:

DRIVING DATA REVENUES

Reluctance also can be due to the expense

of forklift upgrading a legacy BSS that still
has years use left. In those cases, a service
providers sometimes go to its BSS provider
to see if it can provide the products and
professional services necessary to move to the
next level versus bringing in a new supplier.
Another challenge is that very few service
providers have greenfield networks. For
example, even when a mobile operator is
rolling out LTE, it always maintains its legacy
3G and even 2G networks for years rather
than orphaning those customers particularly
machine-to-machine/Internet-of-Things (M2M/
IoT) and the revenue they provide.
As a result, service providers typically have
next-generation RTCC and policy systems
running alongside legacy OSS/BSS, or nextgeneration RTCC and policy systems trying
to interact with legacy network elements
that were not designed to provide and act on
certain types of granular information.
Its hard to deploy a new integrated
charging and policy solution without
considering the complex legacy services,
packages and existing customizations, says
Li QinPeng, a member of the ZTEsoft BSS
marketing team. Its hard to avoid the heavy
workload of integration because of [each]
different vendors product design principle and
structure.

TM Forum Catalysts proof of concept

Four TM Forum Catalyst projects are relevant
to RTCC and policy control. Catalyst projects
are accelerated, short-term R&D efforts for
which a team assembles to develop a proof
of concept, which is then demonstrated and
typically is developed further, with the lessons
learned fed back into the Forum for the benefit
of all its members.
The first is Maximizing profitability with NFV
orchestration2. Network Functions Virtualization (NFV) fundamentally changes network
designs, strategies and capabilities by taking
functionality currently trapped in functionspecific, proprietary hardware and moves it to
a virtualized environment where the hardware
can be purchased off the shelf and is much
less expensive.
This change creates opportunities to do
things with policy and charging that werent
practical or possible with traditional network
architectures. In the process, those new policy
and charging capabilities help network operators maximize the return on investment of their
NFV deplyments.
The Maximizing profitability with NFV
orchestration Catalyst goals include using
policies to enable OSS/BSS, data center
management/analytics, network optimization,
data collection and monitoring and financial
systems to work in concert see Figure 2-3.

Service providers typically have next-generation RTCC and policy systems

running alongside legacy OSS/BSS, or next generation RTCC and policy
systems trying to interact with legacy network elements that were not
designed to provide and act on certain types of granular information.
10

INSIGHTS RESEARCH

2 http://bit.ly/1Tnxl2x

www.tmforum.org

Policies can serve as the programmable objectives

that drive decisions about optimizing network resources

One example is a cloud-based video

streaming service that serves many users
from multiple data centers, all spread across a
wide geography.
In this scenario, policies serve as the
programmable objectives that drive decisions
about optimizing network resources:

Figure 2-3: Standards capturing analytics and dynamic policies are vital to
fulfilling the business value of NFV orchestration

n Policy

triggers optimization based on

threshold events and conditions.
n Multi-dimensional optimization recommends
alternate data centers and cluster zones
to replicate the video streaming virtualized
network functions (VNFs).
n Business and operational policies govern how
orchestrator instantiates and scales VNFs.
This Catalyst currently has several areas of
work underway:
n Expansion

of NFV ZOOM policy schema and

the TM Forums Information Framework
(SID) to support balancing the providers
financial constraints and customer quality
of experience (QoE) expectation (GB922
Policy).
n ZOOM Integration Framework (KPIs/metrics,
policy management) and ZOOM user stories
(TR244).
n Extending the NFV leverage into business
aspects with ZOOM standards-based
functionality to complement ETSI-NFVMANO in unchartered territories.
n Characterization of the interactions among
data collection, analytics, policy decisions,
and NFV orchestration.
n Proactive analytical algorithms.
n Remove barriers between OSS/BSS, finance,
data center infrastructure automation
controls systems.

www.tmforum.org

Source: TM Forum, June 2015

Major achievements so far

One major achievement so far is enabling
a zero-touch closed loop from monitoring,
analytics and optimization to automated
orchestration of services and resources.
This is noteworthy because network
operators generally want policy decisions to
have as little human intervention as possible,
such as by eliminating the need for and cost
of specialized staff to monitor infrastructure
24/7/365 and make decisions based on what
they see. Automating policy decisions is a way
to achieve results, such as improved quality of
services, faster than is humanly possible.

INSIGHTS RESEARCH

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RTCC AND POLICY:

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In the future, the Maximizing profitability

with NFV orchestration Catalyst will expand to
work areas such as:
n Key

metrics and policies needed to incorporate

diverse financial aspects into NFV optimization.
n Second-order optimization considering
constraints such as the switching (operational)
cost and a QoS impact (e.g., time delays) of
adjusting VNFs.
n Public clouds and the Open Digital Ecosystem
application programming interfaces (APIs).
n Synergies between enterprise catalogs and
the policy management functions driving NFV
orchestration.
Closing the loop
The second relevant Catalyst is Closing the loop:
Customer experience, policy and virtualization3,
whose name summarizes the goal of using data
regarding performance, faults and customer
experience/perceptions to continually improve
both the network and the services it delivers.
These improvements can be implemented
immediately or over a long period, based on
the service providers business goals.
Recover first, resolve next
A third, related Catalyst is Recover first,
resolve next: Closed loop control for managing
hybrid networks4, which is focused on mobile
networks. The projects name is based on how
it maximizes service performance in an LTE/4G
network whose virtualized evolved packet core
(vEPC) is provided by multiple suppliers.
One potential application is ensuring
service-level agreements (SLAs), which are
valuable for mobile operators that court highvalue customers such as enterprises and
government agencies. Thus this is yet another
example of how policy control can give service
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INSIGHTS RESEARCH

providers a competitive advantage, such as the

ability to target users that place a premium on
uptime and other performance metrics.
Recover first: Resolve next: Closed loop
control for managing hybrid networks faces
several challenges, according to supplier
and service provider feedback at recent
events such as TM Forum Live!. These are
technological and cultural and include:
n Service

providers do not seem to want

fully automated closed loop control at the
moment. Instead, they prefer the status
quo of having that approval step before any
changes in the network are done.
n SLA negotiation processes will need to be
defined (both in procurement and run-time
context) between multiple actors in the
ecosystem.
n eTOM Level 3 Operational processes and
procedures need to be changed to enable
managing faults in hybrid networks.
n APIs and data models between OSS, NFVO
and VNFM need to be defined.
n VNF service providers need to know the
end customers performance metrics. Those
insights require interplay with customer
experience management (CEM) and other
analytics platforms, so that the job of scaling
in/out is done in an informed way
Orders through orchestration
The final relevant Catalyst is Dynamic APIs for
the connected carrier5, which focuses on ordersthrough-orchestration workflows with zero human
intervention and support for multi-supplier, multioperator environments. The dynamic APIs enable
tasks such as dynamic configuration, automated
interoperability and dynamic adaption, so services
can be changed without disruption and real-time
processing of security, compliance and governance.

3 http://bit.ly/1Hklbz2
4 http://bit.ly/1D2IbSe
5 http://bit.ly/1HQhCVU

www.tmforum.org

This section analyzes responses to this years

survey and compares it to the two previous ones

Section 3

Service providers progress, projects and perspectives

In April and May 2015, TM Forum surveyed
28 service providers in all world regions.
These companies included mobile operators,
data center providers, connectivity resellers
and other providers of data, voice, retail and
wholesale services.
Their customer bases range from fewer than
5 million to over 150 million, and their annual
revenue spans from under US$100 million
up to US$100 billion. Respondents job titles
included vice president of system engineering,
OSS engineer, IS/IT strategy and architecture
expert, analyst, billing engineering coordinator
and senior manager for convergent charging
technology solutions.
Analyzing changes in major trends
This section analyzes their responses and
compares them to two previous TM Forum
surveys: The first was conducted in December
2012 and published in January 2013. The
second was conducted in March 2014 and
published in June 2014 and is available via this
link6.
In the 2015 survey, respondents were given
the option of providing their input anonymously
to encourage candor. Therefore the service
providers quotes are not attributed.
The 2015 survey and its two predecessors
found that service providers overwhelmingly
believe RTCC and policy-control solutions are
must-haves.
Half of respondents in the 2015 survey said
they strongly agree that service providers will
struggle to compete if they dont implement
policy control and RTCC. Another roughly
43 percent said they agree. Only 7 percent
disagreed with that statement or had no
opinion.
6 http://bit.ly/1Rm8AWX

www.tmforum.org

Figure 3-1: Respondents by primary service area

Western Europe

4%

15%

Eastern Europe and/or Russia

19%

Middle East and/or Africa

North America

18%

Latin America
Asia Pacific
26%
11%

Global

7%
Source: TM Forum 2015

Figure 3-2: Percentage of total respondents offering specific services

Network

43%

Data center

86%
54%

Connectivity
39%

Voice
Data

43%
25%

79%

Wholesale
Business

71%

Retail
Source: TM Forum 2015

Half the respondents said they strongly agree that service

providers will struggle to compete if they dont implement policy
control and RTCConly 7 percent had no opinion.
INSIGHTS RESEARCH

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In the March 2014 survey, 55 percent

of respondents strongly agreed with this
statement, and another 40 percent agreed.
This consistently and overwhelmingly
optimistic feedback shows two things.
First, suppliers can safely focus on product
features and use cases they enable instead of
wasting time by having to sell service providers
the concepts of RTCC and policy control.
Second, the optimism expressed during
this time frame shows why so many service
providers have invested heavily in RTCC
and policy-control solutions during that period.
This feedback is significantly stronger than in
the 2012 survey, which asked service providers
to identify the drivers of their RTCC efforts.
Sixteen percent said competitive positioning
was a reason, with drivers such as new service
introduction and enabling better customer
controls receiving more votes. This comparison
suggests that service providers are increasingly
focused on RTCCs competitive, rather than
bottom-line, benefits.
Significant market remains
More than one-third of respondents in the
2015 survey said their RTCC/policy-control
implementation is complete, and nearly 18
percent described theirs as more than 75 percent
complete. This progress is significant compared
to two years earlier, when no survey respondents
had completed their implementations, and the
majority (46 percent) were in the initial phase
of implementation.
By the mid-2014 survey, 53 percent of
respondents had begun deploying RTCC and
policy solutions. This progress isnt surprising,
considering how respondents to the two
previous surveys overwhelmingly agreed or
strongly agreed that these technologies are key
for ensuring their competitiveness.

Figure 3-3: How much do you agree or disagree with the statement that service
providers will struggle to compete if they dont implement policy control and RTCC?
0%

Strongly agree

4% 4%

Agree
No opinion
Disagree
50%

42%

Strongly disagree

Source: TM Forum 2015

Figure 3-4: How would you describe your organizations policy control and realtime convergent charging (RTCC) implementation?
Project complete
Over 75 percent complete

21%

50 percent complete
36%

4%

In procurement
In planning and evaluation

21%
18%

Source: TM Forum 2015

This comparison suggests that service providers are increasingly

focused on RTCCs competitive, rather than bottom-line, benefits.
14

INSIGHTS RESEARCH

www.tmforum.org

Many service providers have substantially

completed their implementations

In parallel with the 2015 service provider

survey, TM Forum interviewed several
providers of RTCC and policy-control solutions
to get their take on the market and to see how
they compared to what their customers said.
In the case of deployments, although many
service providers have finished or substantially
completed their implementations, that
progress doesnt mean the market opportunity
is waning for suppliers. Thats because like
nearly every other type of network investment,
RTCC and policy control are perpetually works
in progress. Thus the markets for RTCC and
policy control have significant upside.
In our experience, operators are pretty far
along, says David Fielding, Senior Product
Marketing Manager, AsiaInfo. Two to three
years ago, we saw quite a big take-up of
operators looking for more flexible RTCC
solutions and bringing policy management into
that play. So there are a lot of opportunities
for Policy and Charging Rules Function (PCRF)
deployments built into an existing online
charging system (OCS) or even OCS/PCRF
replacements, as well.
He adds, Within those three years, were
now looking at a second wind of replacement
systems, where theyre looking at what they
had from an initial first generation solution
point of view. Theyre now looking at some of
the requirements moving forward and whether
those solutions are sufficient.
A fifth of service providers still planning
For all suppliers, theres also an opportunity to
sell RTCC/policy-control solutions to service
providers that havent implemented those
systems at all. More than 21 percent of service
providers in the 2015 TM Forum survey said
theyre currently in the planning-and-evaluation
stage.
Another roughly 4 percent are in the
procurement process. These figures mean
plenty of revenue opportunities for suppliers for
years to come but also plenty of competition
and thus a need for solid market-differentiation.
www.tmforum.org

Figure 3-5: If your organization has multiple business units such as mobile and
enterprise do or will they each have their own RTCC system?
Yes, each unit has, or will have, a
separate RTCC platform.
26%

No, multiple units share, or will share,

a single RTCC platform.

74%

Source: TM Forum 2015

Heavy commitment to invest

RTCC and policy control are major investments,
but the amount spent varies considerably by
service provider. In the 2015 TM Forum survey,
respondents said theyve spent, or anticipate
spending, anywhere from US$1 million to
US$60 million. One respondent noted that
there sometimes are additional, unanticipated
costs. Often those are related to the integration
challenges referred to earlier.
Theres direct spend to enable policy control
and RTCC, and then theres the associated
spend to build out and integrate a positive
experience, this service provider said. The
integration has been more than originally
anticipated for the base cases. Additional
opportunities are being identified which
werent previously planned or anticipated. The
final point shows how RTCC and policy-control
strategies evolve during implementation.
Many more potential applications
As RTCC and policy control have so many
potential applications, its worth exploring whether
multiple business units within service providers
are willing to pool their money to fund the
platforms. Seventy-four percent of respondents
in the 2015 survey said multiple business units
share, or will share, these platforms.
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RTCC AND POLICY:

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For suppliers, this means many service

providers will have a bigger budget for RTCC
and policy control products than if only a
single business unit were footing the bill. The
potential downside is accommodating multiple
needs and wants in a way that disparate users
all can live with, including budget issues.
Battling bill shock
In communications, the worst kind of surprise
is an unexpectedly big bill, such as when cable
customers exceed their monthly data cap and
are surcharged. Surprises are also unwelcome
for service providers, such as when those
customers flood call centers and social media.
Its difficult and expensive to overcome the
perception that there is a degree of dishonesty
around charging, and the worst-case scenario
is when that perception reaches the point
where legislators and regulators see it as an
opportunity to make political hay.
There are additional consequences, as
well. For example, many mobile subscribers
try to avoid bill shock when traveling abroad
by limiting usage or turning off their device
altogether. Syniverse has quantified7 the
revenue impact of these silent roamers at
more than $1.2 billion annually.
Maximizing experience, revenue and brand
Service providers recognize the problem of bill
shock and see next-generation policy-control
and RTCC solutions as a way to maximize
revenue, customer satisfaction and their brand
perception. In the 2015 survey, two-thirds of
respondents said they use those technologies
to manage bill shock, and another one-third
said they plan to begin doing so within the next
two years.
For example, the real-time aspect of RTCC
is particularly valuable by making it easier for
mobile operators to do something about silent
roamers sooner rather than later, such as by
sending a text message as soon as they land to
alert them to affordable options.
Offline, non-real-time analysis tells operators
16

INSIGHTS RESEARCH

what theyve lost rather than giving them

opportunities to salvage what they can.
Bill-shock management was a popular use
case in the 2014 survey, too. Seventy-seven
percent of respondents said its how they
were using RTCC and policy control, and how
roughly 66 percent expected to be using it by
2016.
Competing through flexible offers
There are myriad ways operators are using,
and could be using, RTCC and policy control
to address bill shock. For example, instead
of forcing customers to choose from a rigid,
limited set of mobile data plans such as 1Gb,
5Gb and 10Gb. Instead operators could allow
them to create a bucket whose size more
closely aligns with their actual usage.
RTCC and policy-control platforms can
provide customers with historical usage
information so they can see that, for instance,
selecting a 500Mb plan means they wont be
wasting money on unused gigabytes each
month.
An operator also could use RTCC and policycontrol platforms to allow customers to change
plans every month or, as the billing cycle
winds down, to reallocate money spent on
data toward voice minutes when that bucket is
nearly empty.
Yet another possibility is to link bill-shock
management with other initiatives to achieve
multiple business goals. For example, in the
2015 survey, 40 percent of respondents cited
sponsored data as an application where they
use RTCC and policy control and 60 percent
said theyll use it that way over the next two
years.
Service providers could also give customers
who are approaching their monthly limit the
option of viewing advertisements (or hearing
them in the case of voice) in exchange for
having a third party pay for their usage for the
rest of that billing cycle.
This benefits the service provider by
keeping revenue flowing, avoiding bad debt

7 http://bit.ly/1JWk0tH

www.tmforum.org

In this years survey, giving customers a consistent experience

trumped giving them more control over services and bundles

and minimizing churn, while customers

benefit from being able to continue to use the
services they enjoy. This offering also builds

on the 2015 survey results showing high
interest in using RTCC and policy control to
enable collaboration with over-the-top (OTT)
providers and other third parties.
Enabling dynamic pricing
Half the respondents said they were using
these technologies to enable dynamic pricing
and half also said they were interested in
doing the same. More than 50 percent said
they were using RTCC and policy for advice of
charge and 74 percent said they were using
them for threshold management.
In all of these scenarios, this flexibility
enables operators to cater to customers with
a limited budget or a budget that varies by
month. Those attributes are valuable in todays
hypercompetitive communications market, and
for the foreseeable future.
Flexibility also can be defined in terms of
the ability for service providers to make pricing
and promotional changes to their RTCC and
policy-control platforms quickly and entirely
in-house. They want to avoid the cost and
lead time of bringing in the supplier or hiring
a systems integrator every time they want to
launch a major new plan or promotion, which
historically, theyve had to do.
Service providers want next-generation
solutions that enable them to respond quickly
in days rather than weeks to emerging
opportunities and rivals new offerings by using
their internal staff. RTCC and policy solutions
meeting those requirements will give service
providers a competitive edge.
Shifts in anticipated key benefits
Service providers implement RTCC and
policy-control solutions for many, varied
reasons, but several are common. In the 2015
survey, the primary reason for 89 percent of
respondents was to enable greater pricing
and charging flexibility, such as innovative
www.tmforum.org

Figure 3-6: What are the primary benefits you are achieving, or hope to achieve,
from policy control and RTCC?

Other
Faster time
to market
for new services
Greater pricing and charging
flexibility, such as innovative
rate plans and promotions
Enabling new revenue streams
via partnerships with over-the-top
(OTT) providers and other third parties
New options for
competing against
OTT providers
Increase operational
savings, such as by enabling
customer self-service
Maximizing the return on your
investment in other next-generation
technologies, such as 4G/LTE
0% 20% 40% 60% 80% 100%
Source: TM Forum 2015

rate plans and promotions. The second most

common primary benefit, expressed by 57
percent of respondents, was maximizing the
return on investment in other next-generation
technologies, such as 4G/LTE, followed closely
by faster time to market for new services.
By comparison, in the December 2012 survey,
the most commonly cited driver of RTCC efforts
was new service introduction (27 percent of
respondents), followed by enabling better
customer controls (22 percent). Competitive
positioning ranked third, at 16 percent.
In the 2014 survey, the top driver (45
percent) was giving customers more control
over their services and bundles. The second
(25 percent) was introducing new services,
followed by tapping into OTT revenue.
Participants in the 2015 survey had six types
INSIGHTS RESEARCH

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RTCC AND POLICY:

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of primary benefits to choose from, as well as

the option of providing additional ones. Their
options included to:
n provide

consistent customer experience

across all payment types;
n lower downtime with more advanced
algorithms and analytics and less hardware;
n manage and prevent over-spend/bill shock;
n enable fair-usage policies;
n enforce better control of network resources;
and
n empower customers with a real-time user
experience.
Phasing out flat-rate, unlimited-use plans
One respondent described RTCC as part of
a larger trend, where wired and wireless
service providers are phasing out flat-rate,
unlimited-use data plans. RTCC is a basis for
enabling a rich customer experience and level
of personalization. It can also be used by the
communications service provider to manage
limited network and bandwidth resources to
maximize revenue, this operator said. An
unlimited consumption model free of policy
control is cheaper to implement and likely
provides the best customer experience since
there are no limits or additional costs.
The 2015 survey also asked service providers
how theyre using policy control/RTCC now and
how theyre planning to use them in the next
two years. Although bill shock was a common
choice as a current use case, it wasnt first,
and its ranking plummeted by the end of two
years. Enabling data packs and roaming ranked
top for existing use cases, at 76 percent, with
threshold management a close second.
Unleashing the potential of IoT
RTCC and policy control are ideal ways to
provide a wider variety of data plans for
machine-to-machine/Internet-of-Things (M2M/
IoT) applications, whose notorious price
sensitivity historically has limited that markets
enormous potential. An example is forcing
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INSIGHTS RESEARCH

Figure 3-7: How are you currently or how do you plan to use policy control/RTCC
in the next two years?
Sponsored data
VoLTE and/or VoWi-Fi
Collaboration with third parties
that arent OTT providers
Collaboration with OTT providers
Dynamic pricing
Carrier billing support
M2M/IoT
Wholesale/MVNO management
Data packs/roaming
Special offers/promotions
Revenue assurance
Fraud control
Advice of charge
Threshold management
Bill shock management
0% 20% 40% 60% 80% 100%

M2M/IoT providers and/or their customers to

buy bigger data plans than they need.
Its important to note that M2M/IoT service
providers are among the buyers of RTCC
and policy-control products. Theres a huge
chunk of M2M/IoT players looking for policy
management, says Ari Banerjee, Senior
Director of Strategy, NetCracker. In some
cases, its because their scale and strategies
have outgrown their homegrown or entrylevel BSS platforms. Those systems often
were deployed before the M2M/IoT market
expanded into todays myriad B2B and B2C
applications, which require more flexibility and
creativity when it comes to charging and policy.
In the 2015 survey, nearly 24 percent of service
provider respondents said theyre currently using
RTCC and policy control for M2M/IoT, but the
amount grows to more than 76 percent by 2017.

Source: TM Forum 2015

www.tmforum.org

The worst outcome for VoLTE is if it develops a poor reputation,

for both individual operators and the cellular industry

This expansion shows that service providers

perceive RTCC/policy control as a must-have to
be successful in the M2M/IoT market.
M2M/IoT wasnt discussed in the December
2012 survey, but other research over the
years shows that charging and policy flexibility
is something service providers increasingly
sought as they pursued the M2M/IoT space.
Big opportunity in OTT partnerships
Theres a similar anticipated expansion when it
comes to the ability to support OTT providers
and other third parties. Nearly 32 percent
of respondents picked collaboration with
OTT providers as a current use case, while
more than 68 percent see RTCC and policy
management becoming part of their OTT
strategy within the next two years.
When it comes to third parties that arent
OTT providers, the figures are 22 percent
and 77 percent, respectively. The role of
OTT was already emerging in the December
2012 survey, where 8 percent of respondents
identified it as a driver of their RTCC efforts.
Outside of all three surveys, its clear that
service providers have evolved their view of
OTT players from parasites and competitive
threats to potential, even desirable partners
and new sources of both revenue and market
differentiation. It is no surprise therefore that
this mindset shift is reflected in the surveys.
One wild card that affects their ability to
partner with OTT players and other third parties
however, is net neutrality.
Many more use cases in next two years
If theres one overarching takeaway from
how service providers say theyre using, and
anticipate using, RTCC and policy control, its
that most use cases will expand significantly
over the next two years.

This outlook is yet another example of how

service providers believe these tools will be
increasingly important for their competitive
position and bottom line.
Its also good news for suppliers because
many of those use cases have yet to be
envisioned, which means their service
provider customers will be coming back to buy
additional products and professional services.
Voice remains a killer app
Despite the roaring success of data services
both wired and wireless, voice remains popular
with consumers and business users alike.
What has changed is how voice is consumed
and delivered. Two respective examples are
OTT VoIP services, such as Skype, and voice
over LTE (VoLTE), which effectively turn voice
into a real-time data application.
Indeed, in the 2014 survey, 28 percent
of respondents were using both RTCC and
policy technologies to support VoLTE. One
reason is because policy enables operators to
ensure that VoLTE, including HD Voice, gets
the bandwidth prioritization and other things
it requires to deliver a positive customer
experience.
Those capabilities are particularly important
now because VoLTE has to deliver a positive
experience from launch to get customers to
use it rather than sticking with circuit-switched
service, which is less efficient from a spectrum
perspective. The worst thing that could
happen, for both individual operators and the
cellular industry as a whole, is for VoLTE to
gain a bad reputation, which would be difficult,
expensive and time consuming to overcome.
VoLTE vaults up the agenda
The numbers of VoLTE deployments and
devices have grown markedly since the 2014

What has changed is how voice is consumed and delivered. Two

respective examples are OTT VoIP services, such as Skype, and voice
over LTE (VoLTE), which turns voice into a real-time data application.
www.tmforum.org

INSIGHTS RESEARCH

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RTCC AND POLICY:

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survey. As of June 2015, 90 operators have

launched or are deploying VoLTE, according
to the Global mobile Suppliers Association
(GSA)8. There are also roughly 219 models
of VoLTE-capable smartphones and other
devices.
In the latest survey, nearly 23 percent of
respondents said theyre using RTCC and
policy control for VoLTE and/or voice over WiFi (VoWi-Fi). More than 77 percent expect to
begin doing so over the next two years.
All of this interest and activity means RTCC
and policy suppliers should ensure their
solutions make it easy for operators to manage
and charge for voice services, regardless of if
theyre delivered over LTE, Wi-Fi or both.
Teething troubles
Although the 2015 survey found a clear-cut
business case for RTCC and policy control,
implementing those systems is muddy.
Respondents identified integration as the top
challenge, followed by transforming internal
processes.
More than 46 percent of respondents
complained about the challenge of
organizational alignment, such as getting
siloed business units to agree on policies. One
reason for this is, as discussed earlier, RTCC
and policy control have so many potential
applications that they frequently enjoy buyin by multiple business units within a single
service provider. That can mean more money
to spend on RTCC and policy control, but such
joint efforts also mean multiple stakeholders,
and the challenge for both service providers
and suppliers is trying to satisfy the disparate
entities.
The survey question also provided the option
of submitting additional challenges. Two
provided were future use case development
cost and complexity and operational stability
of the solution.
In the December 2012 survey, transforming
internal processes was the top challenge,
followed by procurement and operational costs.
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INSIGHTS RESEARCH

Figure 3-8: What are the biggest challenges youve encountered, or anticipate
encountering, with your policy control/RTCC implementation?

Organizational alignment, such
as getting siloed business
units to agree on policies
Analytics
Managing scale
Integration
Procurement and
operational costs Increase
Transforming internal processes
Other

0% 10% 20% 30% 40% 50% 60% 70% 80%

Source: TM Forum 2015

Integration was third, which makes sense

because at the time, fewer service providers
had begun implementation.
By the time of the 2014 survey, incorporating
multiple lines of business was the primary
challenge, followed in second place by both
incorporating legacy systems and transforming
internal processes.
Underestimating persistent challenges
One takeaway from comparing the three
surveys is that although many service providers
expected cultural and technological integration
to be obstacles to fully leveraging RTCC,
they may have underestimated the size and
longevity of those challenges.
However, as the 2014 survey noted, the
migration to software-defined networking
(SDN) and network functions virtualization
(NFV) are paradigm shifts forcing disparate
groups to work together. This collaboration
creates a foundation for them to put aside
cultural differences so they can work together
on RTCC and policy control.

8 http://bit.ly/1HeFJKi

www.tmforum.org

The suppliers provide the product features we require,

but the main challenge is the IT legacy systems

Healthy market for professional services

Service providers generally dont feel as if
theyre having to muddle through on their own.
A majority of respondents answered yes to the
question, Are suppliers doing an effective job of
providing the tools and/or professional services
you need to address those challenges?
This feedback suggests that theres a healthy
market for professional services. Thats good
news for vendors not only as an additional
source of revenue, but also as a recurring
one because the transformation to RTCC is a
process that takes years.
Many challenges and opportunities remain
That said, some respondent described supplierrelated challenges such as:
n We

are still victims of vendor lock-in.

network vendor solutions are solid but
lack flexibility. Software vendor solutions are
relatively immature, not well integrated and
fall short of the marketing claims.
n Lack of flexibility on pricing models and
complex customization of the products lead
to long time-to-market (TTM). Its worth
noting that in the December 2012 survey,
only 5 percent of respondents identified TTM
as a driver of their RTCC efforts.
n Operational tools not effective. No good
tools for revenue assurance.
n Operators and providers must try to leave
as much product development in the hands
of the operator. Vendor engagement for
product delivery always leads to bottlenecks
and affects the agility of enterprise in
delivering with quick time to market.
Additionally, operators in RTCC space should
cater for cases where external platforms
are maintaining balances due either to
contractual obligations or legacy.
Weve had a tough time convincing
suppliers that the Rc interface should be used
for external Account Balance Management
Functions (ABMFs), as well. Finally, RTCC
borders on the IT space, so we need the

flexibility on that level.

When we start talking about notifications,
Customer Relationship Management (CRM)
integration, etc., suppliers need to provide
customizability and APIs that can be flexibly
configured. Suppliers tend to stick to their
interpretation of the Diameter and 3GPP
specifications.
For suppliers, these pain points are
opportunities to differentiate themselves, in
terms of for example professional services.
Operators, in their own words, on financial,
organizational and technical issues
In follow-up interviews, service providers
elaborated about variety of implementation
challenges that are financial, organizational and
technical. Following are some highlights:

n The

www.tmforum.org

n From

a technology project/program
perspective, the major challenge is dealing
with other BSS and network-transformation
projects. Getting resource commitment is
difficult.
n The suppliers provide the product features
we require, but the main challenge is the
legacy IT systems. [We], the operators,
should have many enhancements to adopt
new RTCC/policy solutions. These suppliers
may provide more interfaces to integrate
with the legacy systems. Or they may come
with solutions which can allow operators to
run legacy and next-generation systems in
parallel.
n Over time, BSS and network stacks have
developed ball-of-mud platforms. After
some time, when looking at a particular
product, we dont know whether it was
implemented that way because business
wanted it that way, or whether it was due
to a limitation on one or more platforms at
the time. So determining granular scope is
difficult. We end up doing like for like due to
time limitations or fear of breaking whats
working.
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RTCC AND POLICY:

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n The

biggest integration challenge is being

able to instill a form of ownership across
the enterprise. Additionally, resourcing is a
problem because business-as-usual demand
will always consume resources. The way in
which we overcome this is through a gradual
process. I favor the concept of utilizing
thin verticals (in terms of development and
implementation) and steer the organization
incrementally over a year or two. The most
important thing is to have the RTCC platform
installed in the enterprise.
n From an organization perspective, theres
always a separation across real-time and
post-billed environments. Historically,
segmentation between real-time and postbilled customers is propagated from a tech
planning, operational support and marketing
perspective. So weve essentially got
technology and business billing and product
specialists in real-time charging (prepay) and
post-pay, not both.
n From a financial perspective, implementing
RTCC can affect the rate at which we write
off existing assets used for charging. Getting
executive buy in becomes an issue.
n We are still lacking both next-generation
RTCC and policy systems. Our primary
objective is to have a policy-control
architecture as soon as possible, and then
we will focus on RTCC. Right now billing and
charging of postpaid subscribers are handled
on legacy offline CDR-based systems. We
have couple of reasons to focus on first
policy control. Replacing postpaid systems
is a complicated process since replacement
will touch too many other domains, and there
will be huge developments on all-IT domain.
These can be done with a couple-of-years
project. Postpaid replacement will take long
time, and since 4G rollout in my country
is coming close, policy control got more

importance. Postpaid quota management

should be online as soon as possible to avoid
any revenue loss with 4G. Our network
departments require new interfaces and
want to use new protocols (such as Sy) to
integrate their 4G network elements with
billing and charging domains.
For example, the service provider quoted
in the panel on page 21 that decided to
implement Policy Charging Control (PCC) first
said it chose a supplier based on its ability to:
n deploy

that system faster than its rivals could;

its PCC solution with the service
providers legacy IT systems; and
n provide next-generation interfaces to the
network.
n Integrate

It is difficult to overcome these challenges,

this service provider said. So instead of
having a one-shot RTCC/PCC replacement,
we decided to implement first PCC and then
RTCC.
Trend: Cross-pollination of Network and IT
Another survey participant is a major cable
operator which is in the planning and evaluation
stage. This company is generally pleased with
what suppliers are providing but believes some
of them are at a competitive disadvantage.
The vendor community has a lot of very good
solutions, the service provider said. Some
suppliers have an integrated view of the systems
getting into the network. Others only have the
system side. In the future, it will be key to go
with suppliers that come from either the network
space or the IT space, but they are trying to
cross-pollinate those cultures and technologies.
Thats the way the world is going. I would
have a hard time buying a policy-management
[solution] from a traditional OSS/BSS player.

Replacing postpaid systems is a complicated process since replacement will touch

too many other domains, and there will be huge developments on all-IT domain.
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INSIGHTS RESEARCH

www.tmforum.org

Its important to check whether

regulation limits potential new revenue

Net neutrality and other regulatory wild cards

RTCC and policy control give service providers more flexibility in how they price services and partner with
third parties such as OTT players, so its worth looking at whether regulatory policies limit some of that
flexibility and revenue potential.
A high-profile example is net neutrality. In the 2015 survey, respondents were nearly evenly split on
whether or not they were concerned that net neutrality would affect their use of policy control and RTCC.
This survey question gave participants the option of explaining why they chose yes or no. Following are
examples of yes responses:
n They

have already.
are dozens of regulations in Turkey. All these regulations should be implemented as call records on
existing RTCC/policy-control solutions of the suppliers.
n Privacy issues will be there due to layer seven analysis. Payload inspection to reveal the URLs and
behavioral analysis of customers. If deep packet inspection (DPI) function [is] not allowed by regulations,
most of the policy-control mechanisms and OTT marriages wont work successfully.
n Will need to inspect policies, demand transparency and ensure proper treatment of customer charges.
n We need to adapt traffic categorization accordingly.
n Impact on policy control only.
n There

Some of the no respondents explained why theyre not concerned:

n We

do not segregate quality of service (QoS) across customers (yet).

there are no PCC use cases overlapping with net neutrality.
n RTCC is capable of handling the new changes, and operators can use it to generate new revenuegenerating mechanisms.
n Weve taken a more holistic approach, so net neutrality wont affect us. We have competitors who will be
affected because they were zero rating their entertainment content.
n This has been applied in my country prior to us procuring RTCC. We have an electronic communications
network service (ECNS) license.
n Currently

For suppliers, this feedback is both good and bad. The best advice is that they should anticipate net
neutrality and other regulatory concerns coming up during the sales and post-sales processes and be
prepared to help their customers navigate that environment. As the survey responses show, service provider
understanding of the regulatory impact runs the gamut from confident that it will be minimal, to cautious, to
concerned. When a service provider says, If DPI function [is] not allowed by regulations, most of the policycontrol mechanisms and OTT marriages wont work successfully, its probably going to spend far less on
RTCC and policy products for fear of a low return on investment.
To provide the kind of guidance service providers need, suppliers must keep up to date with the
regulatory agendas in each country where they have existing and potential customers. This does however
represent another way for suppliers to turn customer challenges into market-differentiation opportunities.
Those suppliers that dont recognize and address the concerns of potential customers risk losing sales
altogether because service providers will be reluctant to invest in products that will or could be neutered
by regulatory dictats.

www.tmforum.org

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Section 4

Conclusions and recommendations

The 2013 TM Forum report concluded that
there is no single driver compelling service
providers to adopt RTCC and no real finish
line telling them they have reached their goal
because the goal posts keep moving. Two
years later, it still applies. For service providers,
the takeaway is that RTCC and policy control
are journeys, not destinations.
Quietly losing $1 billion a year
As the 2015 survey and its predecessors show,
bill shock continues to be a major reason for
deploying RTCC and policy-control. Its not
hard to understand why. In the case of mobile
operators, silent roamers represent more than
a billion dollars in annual lost revenue.
There are bill-shock-related costs such
as restoring brands damaged by customer
perceptions that operators charge customers at
every opportunity.
Minimizing bill shock and in the process,
developing a reputation for respecting
customers budgets will be key for service
providers needing or wanting to reach
consumers with limited budgets or budgets
that fluctuate wildly from month to month.
Self-service: What customers want
Service providers and their suppliers also
shouldnt overlook the roles that RTCC and
policy control can play in enabling the selfservice that consumers overwhelmingly say
they prefer versus dealing with live agents.
This goes beyond obvious examples such

as going online to choose services from a list,

to include being able to move funds between
service types during a billing cycle.
One 2015 survey respondent cited one
mobile customer being able to shift funds from
her data bucket to her voice bucket when the
latter was running low during a billing period.
Self-service is a win:win situation. When
customers can help themselves, service
providers can lower overhead costs, such as
needing fewer staff in call centers. And the
easier it is for customers to find, personalize and
buy things all on their own, the more they are
likely to spend.
Hence enabling the widest possible array of
self-service options also should be a key focus
for suppliers. This goes beyond customers
simply being able to turn services on and
off without an agents help, because thats
something many service providers already offer.
Customers should also be able to do things
such as combine services into bundles, create
their own rate plans and decide what happens
to their broadband access when they approach
their monthly data limit.
The key to profitable partnerships
This TM Forum surveys show that service
providers view RTCC and policy control as
valuable tools for facilitating relationships with
over-the-top (OTT) providers and other third
parties. But no one knows exactly what those
relationships will look like in terms of services,
charging and policies.

When customers can help themselves, service providers can lower

overhead costsAnd the easier it is for customers to find, personalize
and buy things all on their own, the more they are likely to spend.
24

INSIGHTS RESEARCH

www.tmforum.org

The market for these platforms will remain robust for the foreseeable
future as service providers need new features and platforms

So when selecting RTCC and policy-control

solutions, its important to solicit input from all
of the business units that plan to, or potentially
could, use those platforms.
Suppliers must make it easier for service
providers to partner with OTT providers and
other third parties. One example is making it
possible to charge accurately for voice calls
that begin on the operators cellular network
but end on a third partys Wi-Fi network.
This application is a major opportunity
not only because so many mobile operators
want to offload both data and voice, but also
because so many cable operators are offering
their new Wi-Fi networks as a way to do so.
Policy control plays a pivotal role in these
scenarios by enabling service providers and/or
their customers to decide when those handoffs
occur. Examples include signal strength,
specific tariff requirements and cellular data
balances. All these are difficult or impossible to
implement with traditional charging platforms.
Culture clashes continue
Following this advice may be easier said
than done because it runs into the cultural
integration challenge that some survey
respondents identified. An example is IT, billing
or network engineering treating marketing as
an equal when it comes to choosing and using
these platforms.
A worst-case scenario is that IT, billing
or network engineering makes all of the
purchasing decisions based on its roadmap,
and marketing ends up with a rigid, limit set
of tools that makes it difficult or impossible to
execute its OTT/third-party strategies.
The same scenario can undermine other
types of offerings that dont involve third
parties. Indeed, as the June 2014 report noted:
For many years, billing was an obstacle to
www.tmforum.org

marketing. The marketing department resented

having to ask the billing department whether it
was safe to launch a new product. Sometimes
they asked, and sometimes they didnt.
This led to services and products routinely
being changed or withdrawn because billing
could not support it, at least for another six
months.
That is as unacceptable as it is common.
Service providers need to break this cycle to
maximize return on RTCC and policy-control.
Shared investment allows bigger budgets
When multiple business units are allowed to
have an equal say, one major benefit is the
potential for a bigger budget than if a single
department were covering the platforms
capital and operating expenses. This shows
that suppliers have a vested interest in helping
service providers understand why and how
disparate business units can work together.
Mine Catalysts for guidance and inspiration
Finally, service providers should look for
inspiration and guidance in the four TM Forum
Catalyst projects that are relevant to RTCC
and policy control. One example is Maximizing
profitability with NFV orchestration, which is an
opportunity for operators to ensure that their
policy-control, RTCC and Network Functions
Virtualization (NFV) strategies are aligned.
In addition, the Catalyst program is a rolling
one, so if you have a specific business issue
youd like to address or to find out more about
the Catalyst program in general, contact
TM Forum Catalyst Program Manager, Jean-Pierre
Dufresne direct via jdufresne@tmforum.org.
No-nonsense feedback for vendors
The three surveys show that service providers
believe that RTCC and policy control are key for
INSIGHTS RESEARCH

25

RTCC AND POLICY:

DRIVING DATA REVENUES

maximizing their competitiveness and revenue

opportunities. They also believe that RTCC and
policy control are journeys, not destinations.
For suppliers, this feedback means the market
for these platforms will remain robust for the
foreseeable future because service providers will
need additional features and/or new platforms.
Anticipating those needs is vital and a good
place to start is the applications that service
providers identified in the survey as falling into
a two-year window. The likeliest applications
will be related to machine-to-machine/Internetof-Things (M2M/IoT) because many service
providers and not just mobile ones are
heavily focused on getting more revenue and
traction in that market in the next two years.

The wild cards regulators could play

The 2015 survey shows that many service
providers are concerned, confused or both
about the potential effect of regulatory wild
cards particularly net neutrality on their
ability to get the most out of their RTCC and
policy-control investments.
These mindsets threaten to undermine
spending. As a result, suppliers should closely
follow the regulatory environment in each
country where they do business to anticipate
and address customers concerns during the
sales and post-sales processes. They should
also look to their solutions providers for help
with this vexed issue, and ensure all their
partners are conformant too.

The on-going pain of integration

Integration remains a major challenge for
service providers, which means its also a
major opportunity for suppliers in terms of
revenue and market differentiation. Suppliers
sales and marketing departments should make
a point of demonstrating to service providers
how they can help with integration.
Service providers typically operate their new
RTCC and policy-control systems alongside
legacy, offline charging and other systems.
Service providers also may choose to initially
keep their policy and charging systems
separate before eventually integrating the two.
These choices are examples of how theres
no single strategy and architecture that applies
to every service provider. As a result, service
providers will want help integrating new policycontrol systems with new RTCC systems,
as well as those new systems with legacy
systems. Its all complex work, but it can
pay off for suppliers in terms of sales and for
service providers in terms of more revenue and
market-differentiation opportunities.

Advantage is not automatic

Although respondents to all three surveys
overwhelmingly agree that RTCC and policy
control are key for ensuring competitiveness,
these technologies cant singlehandedly
outweigh disadvantages such as a poor brand
reputation, outdated broadband capabilities or
limited spectrum.
Indeed, one respondent to the 2014 survey
said, If Carrier A had [unreliable] spectrum and
a great RTCC system, and Carrier B had great
spectrum and no RTCC, Id bet on Carrier B.
So while RTCC and policy are required
technologies for virtually every service
provider, now or in the near future, simply
deploying them wont give operators a big
competitive edge. Instead, any advantage will
depend on whether theyre more innovative in
their use than their competitors.
This reality offers a terrific opportunity to
suppliers, systems integrators, consultants and
others to help service providers develop and
execute effective RTCC and policy strategies.

26

INSIGHTS RESEARCH

www.tmforum.org

Frameworx is adopted by 91 percent

of the worlds largest service providers

MAKING DIGITAL BUSINESS REAL

WITH FRAMEWORX 15
The latest version of blueprint for digital business success,
TM Forum Frameworx 15, gives Forums diverse global membership
actionable information that can be used immediately.
Agile Business & IT
TM Forums Agile Business and IT Program helps enterprises
optimize their IT and business operations. New features include:
n A

dynamic policy approach to end-to-end SLA management for

hybrid operations, underpinned by the worlds first information
model for the hybrid environment.
n A catalog approach to creating services through internal service
components and external sources, supported by a federated
catalog model, a UML catalog model in the Information Framework,
DevOps and agile product lifecycle management.
n A Procurement Survival Kit based on procurement patterns,
ecosystem partner management, NFV procurement packaging,
federated catalogs and maturity models.
Open Digital Ecosystem
TM Forums Open Digital Ecosystem Program helps service
providers, enterprises and technology suppliers create and manage
complex, innovative services. New features include:
assets to support for any organization in any digital
business, using partnership best practices (B2B2x), service
platform architecture (DSRA), and APIs. They have been validated
by use cases for smart energy, digital health, smart city, Internet of
Things (IoT) and others.
n The Digital Services Toolkit provides a structured methodology and
process to map business contexts to Frameworx assets.

Security & Privacy

TM Forums Security & Privacy Program run across all projects in the
strategic programs outlined above. New features include:
n The

initial blueprint for a Privacy dashboard identifies the aspirations

of individuals and organizations.
n Privacy management is integrated into the Frameworx Engaged
Party work, which to date includes the Information Framework
and Business Process Framework.
TM Forums Security & Privacy Program also focuses on
orchestrating security functions end-to-end across virtualized services
see the Catalyst project Security Functions in NFV.

n End-to-end

Customer Centricity
IoT, smart everything and virutalization will impact customer
centricity and the use of analytics. This program is building a
common language, tools and resources to enable the transition to an
omnichannel, customer-centric digital future:
Customer Experience Management (CEM) ROI Calculator
supports better decision-making around investment.
n The Omni-channel Introductory Guide has a new maturity model
and an more than 70 new requirements to accelerate discussions
internally and with suppliers.
n The 360-degree view of the customer explores how a repeatable
approach and common language streamline better, personal
interactions.
n Eight new business-oriented use cases for data analytics, bringing
the total to 59, for service providers and suppliers to simplify and
speed up data analytics projects.

Core Frameworks
Updates to the core frameworks widen their applicability to digital
ecosystems:
n The

Supplier/Partner concept in the Information Framework has

evolved the Engaged Party work to reflect the range of partnerships,
relationships and models needed for multi-industry digital
ecosystems.
n The Application Framework is more granular to maximize the reuse and consistency of common functionality. This also simplifies
procurement of applications.
n Assets from the Security & Privacy and Customer Centricity
programs are embedded into Frameworx 15.

n The

www.tmforum.org

Frameworx Conformance Certification

Frameworx is used by 91 percent of the worlds largest service
providers and 82 percent of respondents to TM Forums 2014
Frameworx adoption survey mandate Frameworx in requests for
proposal.
More than 85 products, solutions and implementations from more
than 30 companies have been certified as conformant to Frameworx.
Read in the Case Study Handbook 2015 and Perspectives 2015 how
Frameworx helps companies across multiple industries make digital
business a reality.

INSIGHTS RESEARCH

27

Sponsored feature

ZTEsoft Integrated PCC Improves

Data Monetization Approaches

Along with the development of

telecommunication technology,
popularization of intelligent terminal and
boom of OTT service, mobile data volume
grows rapidly and personalized customer
requirements are emerging in an endless
stream. Therefore, an increasing number
of operators hope to improve the
capability of data monetization through
diversified data bundles, flexible prices
and differentiated service experiences.
With the growing mobile data demands,
one of the key challenges telecom
operators face in delivering mobile data is
to manage network congestion without
marginalizing their subscribers and at
the same time monetize network traffic,
improving subscriber-facing activities and
increasing ROI from network investment.
Policy control enables the telecom
operators to set policies to help manage
the increased network traffic, at the same
time, allowing for increased marketing
capabilities as additional personalization
can be achieved and effectively managed
which results in an improved customer
experience.
Technically, to address personalized
and diversified experience requirements,
PCRF needs to acquire full user
data. For PCRF and OCS in delocalized architecture or from different
manufacturers, PCRF needs to
synchronize data from OCS generally.
However, such data synchronization
is implemented in non-real-time mode
so that it cannot satisfy experience
requirements of customers in time.
In addition, operators need to invest
a lot in relevant integration and
coordination, which also extends
Time-To-Market (TTM). With separate
OCS and PCRF main issue appears in
28

INSIGHTS RESEARCH

case of consumption accumulation, as

subscriber data is maintained separately
in both systems whereas in real time
the information is updating but the data
synchronization is not carried out in real
time. This results in data inconsistency
between two systems and this hampers
the viability of enforcement policy.
Sy interface is defined in 3GPP of
release 11. PCRF can interact with OCS
(requesting/sending the spending limit
information of services) through the
interface. In ZTEsoft Integrated PCC
solution, the interface is expanded so
that it can provide extra support (we
call it Sp/Sy interface, shown in the
figure below), such as customer profile,
subscription and account information,
and real-time interaction of service
usage. Integrated PCC solution adopts
data source and data model of OCS.
Therefore, it naturally inherits business
scope of OCS and is equipped with
capabilities of implementing complicated
services such as VPN group policy
and volume share policy. Meanwhile,

it can also avoid possible deviation

or customer experience decline of
data synchronization (or separated
provisioning) between OCS and PCRF.
ZTEsoft integrated PCC architecture
brings the following advantages:
1. Provide unified customer data and
product management, and avoid
possible inconsistency risk caused by
data synchronization between different
systems.
2. Shorten TTM and reduce
interconnection, customization and
parameter configuration work due to
de-localized architecture and different
manufactures. Define unified product
price and policy to put them forth to
the market rapidly.
3. Reduce TCO. Unified platform
deployment can reduce solution cost.
Unified maintenance can improve
operation & maintenance efficiency.
With integrated PCC architecture
design shown above, ZTEsoft integrates

Figure 1: ZSmart Integrated PCC Architecture

PCRF

PCEF

Other BOSS

Sp/Sy

DB
OCS

www.tmforum.org

Figure 2: ZSmart Integrated Policy & Charging

ZSmart Integrated Policy & Charging
Unified Interface Platform

Policy Engine

Charging Engine
Product Catalog

Sp/Sy Proxy

CDR/EDR Mgmt.

/SPR

Online Collection

Policy with Charging so that control policy

can be integrated with charging policy.
1. Policy can be defined as a condition
of bundle or price. It can provide
diversified data bundles for customers,
such as bandwidth upgrading bundle
based on volume accumulation.
2. Bundle, combined with other
conditions such as time, location,
event, and consumption accumulation,
can also be considered as the basis of
policy judgment.
Telco operators can flexibly combine
multiple data bundles that contain policies
according to actual requirements. The
policies can be:
1. Policy based on customer features
such as customer grade, birth date,
address, and customer group. For
example, high valued customers
can benefit bandwidth upgrading on
birth date or obtain the present of
www.tmforum.org

bandwidth upgrading volume in fixed

quota or within fixed time segment,
etc. For enterprise customer group,
operators can set that the members
can only visit relevant work websites
in specified place during working
hours. For family customer group,
operators can allocate different volume
share limits and different bandwidths
to different family members.
2. Policy based on account balance.
Bandwidth can be adjusted in real
time according to account balance. For
example, when the account balance
of a customer is more than $50,
widen the bandwidth; if the account
balance is less than $10, narrow
the bandwidth; or when dedicated
account balance (for example: the
customer purchase a Wi-Fi duration
recharge card of $10) satisfies relevant
conditions, renew the bandwidth
control rule.
3. Policy based on consumption
accumulation. Policy can be

adjusted according to consumption

accumulation of different (data)
services. For example, when monthly
consumption of the customer exceeds
$50, widen the bandwidth as an
award. When monthly quantity of SMS
sending of the customer is more than
500 pieces, widen the bandwidth.
4. Policy based on dedicated data.
Differentiated policies can be provided
for different service bundles. For
example, put forth 2M bandwidth
bundle without volume limit for
Facebook service. For 4M bandwidth
bundle with volume limit for P2P
service, reduce the bandwidth to 128K
if the volume exceeds the threshold.
Nowadays, the relationship between
carriers and OTTs has been changed from
competition to collaboration, because
both of them want to maximize the
added values of combing networks and
contents. To address this change, ZSmart
integrated PCC is able to support more
flexible business models, e.g., dedicated
data volume for specified services, and
offered different QoS according to service
types. In addition, to address carriers
services (e.g., VoLTE, and Video Conf.) in
IMS/LTE, ZSmart integrated PCC enables
IMS-based charging related functions
as well. As a result, it improves carriers
core competence.
With all the above mentioned and
many more competitive advantages,
ZSmart co-localized PCC is a matured
industry proven solution and already
been deployed within number of notable
customers including Orange references
in Africa countries, Vietnam operator in
oversea subsidiaries and one Indonesia
incumbents.
INSIGHTS RESEARCH

29

Sponsored feature

Real-Time Policy and Charging Essential

for New Technology and Business Models
Virtualization, next-generation mobile networks and advanced digital services
are changing the game for communications service providers.
Hypercompetition from OTT providers,
pricing pressures from freemium
applications and rapidly changing market
dynamics due to net neutrality orders are
driving new demands, new requirements
and adoption of new technology and
business models across the full spectrum
of service providers.
All of these sudden and ongoing
challenges make it clear that todays
policy and online charging systems arent
optimized for future demands. This is
especially true for disruptive technologies
and architectures:
Next-Generation Mobile Technologies:
LTE is already causing a fundamental
rethink in how services are created and
delivered, and this will only become more
challenging as 5G enters the picture
with its always-on connectivity, faster
speeds and extremely low latency, which
will enable more real-time interactive
multimedia services, such as augmented
reality, virtual reality and real-time online
games.
Internet of Things (IoT) and M2M:
Trillions of transactions across billions of
devices will upend traditional charging
and billing models with their huge scale
and high performance requirements and
will necessitate the inclusion of strong
partner management and settlement
functionality.
Virtualization: The faster time to
market afforded by SDN and NFV, while
advantageous to operators looking for
new revenue streams, poses a number
of challenges, including requirements to
keep up with rapid provisioning and onthe-fly changes to products and services
(See Sidebar).

30

INSIGHTS RESEARCH

Figure 1: NetCracker Real-Time Policy & Charging Architecture for Digital Service Providers

Todays policy and online charging

systems will need to undergo a rapid
evolution to keep up with the fast pace
of changes happening to the network.
Given the complexity of network and
business changes, operators will require a
cutting-edge BSS system to future proof
themselves and help them maximize their
revenue potential from more intelligent
service delivery, thereby enabling them to
drive efficiency, creativity, customization
and ultimately profitability more
effectively than they can execute today.

Policy, Charging and Analytics Evolve

with the Times
The conventional policy and online
charging systems that have been in place
within operator environments for years
are no longer sufficient and in fact will
prevent operators from taking advantage
of the numerous benefits of virtualization,
next-generation mobile technologies and
cutting-edge business models involving

the IoT and M2M. As such, operators that

want to stake a major claim in the digital
service ecosystem will need to create an
end-to-end integrated environment that
covers five main pillars (See Figure 1):
1. Customer-Centric and Big Dataenabled Real-Time Analytics: A high
performance online analytics function
that creates real-time contextual
offers to customers, resulting in more
relevant products and bundled offers
and a quick return on investment for
operators.
2. Service-Centric Online Charging: A
high performance transactional charging
function that can easily handle online
interactions with network elements
for real-time authorization of services
requested. This function should also be
able to use offline interfaces and collect
usage data as soon as it is available to
ensure proper utilization of network
resources and the most accurate data
about billable services.
www.tmforum.org

3. Network- and IT-Centric Policy

Controls: A catalog-driven policy
management module that allows
operators to quickly create new service
plans without having to perform a
major change to their network/IT
infrastructure.
4. Partner Enablement and
Management: A system that will make
it possible for operators to conduct
multi-party settlements and play roles
as both a service provider and a service
consumer.
5. Unified Product Catalog: This is
critical for any operator offering
services across various platforms,
ecosystems and networks. The realtime component becomes critical to
create bundles on the fly, minimize
time needed to deliver services and
allow for greater personalization of
services.
A few examples of what these
functions can provide include:
VoLTE QoS: Using a
real-time integrated policy and charging

n Differentiated

solution, operators can now tie data

usage buckets with voice quality for
VoLTE users. For example, users with a
2GB monthly data bucket will enjoy HD
voice until they are close to the 2GB
limit. The voice quality then drops to SD
voice after exceeding the limit and until
the next billing period.
n Contextual Campaigns: Real-time
analytics provide clear insights into
what a customer is willing to pay for
services consumed. For example if
a user wants to watch an HD video
while traveling on public transportation,
the charging system and the network
can determine if there is network
congestion and offer the user SD video
at a lower price while in a public place.
n Dynamic Offers: With analytics-driven
policy and charging control, service
providers can create new revenue
opportunities. For example, if a user
has exceeded his or her 2GB monthly
bucket of data while watching a football
game, the online charging and analytics
engine will determine if the user can
get a 2GB Add-On Football Bundle,
which, once accepted is immediately

allocated while the user continues to

watch the game without interruption.
Real-Time BSS for the New Digital
Ecosystem
While todays policy and online charging
systems have served operators well
for years, they are unable to rise to
the challenges of what lies ahead. To
remain competitive, operators have to
move beyond the realm of integrated
policy and charging systems and will
instead need a real-time BSS solution
that incorporates essential functions such
as partner enablement and settlement,
real-time analytics and a unified catalog all
integrated and working closely together.
They will also utilize the big data being
collected along with the appropriate
context to deliver dynamic offers and
further differentiate themselves in an
increasingly crowded field.
Its only through a true real-time
approach, and close collaboration
among a number of BSS functions, that
operators will be able to survive current
and future challenges and thrive in the
new digital ecosystem.

Virtualization Changes the Playing Field

Real-time charging, as part of a broader real-time BSS and online
charging system solution, has become a standard component
of most operators network infrastructure. But as that network
starts to change, first to a hybrid environment and then on to full
virtualization of numerous functions, it still needs to accommodate
real-time charging regardless of platform, type of service, type of
device or any other variable.
The primary value in a real-time policy and online charging
system will be in its ability to react quickly as virtualized functions
are spun up or torn down, and services come to market faster than
ever before.
Operators will want to guarantee that their charging systems
can evolve along with their networks, which will require a radical
rethink and repositioning of this all-important BSS function.

www.tmforum.org

An SDN/NFV environment will require a solution that is flexible

enough to take advantage of a dynamic virtualized environment,
but also programmable and able to capture any type of chargeable
event or trigger as soon as its plugged into the control plane.
Next-generation BSS systems need to respond in real time to
accommodate new types of billing events and to take policy-driven
actions in response to the continual triggers from the control plane.
With SDN and NFV, operators will be able to create new service
models in partnership with any number of third-party vendors, and
services will also be exchanged across various channels. With
these new service mash-ups, operators will need a system that
can accommodate multi-party compensation and settlement.
Without these pieces in place, it will be extremely difficult to
fully leverage and monetize a virtualized environment.

INSIGHTS RESEARCH

31

Sponsored feature

The future of data service innovation is clear and its personal

Integrated policy, charging and catalog drive monetization
In an increasingly crowded digital
landscape, service providers are going
head to head with Google and other new
entrants for the hearts and wallets of
subscribers. Data has overtaken voice
in many markets, creating a disruptive
shift in how services are delivered
and consumed. Add in the estimated
$71 billion in lost revenue to over-the-top
(OTT) voice by 20201 and its clear that
finding ways to monetize the value of
the network is critical to carving out new
opportunities and market share.
Quality of experience creates a
powerful weapon for service providers to
engage subscribers and collaborate with
OTTs. With the introduction of complex
services such as voice over LTE (VoLTE)
and video over LTE (ViLTE), subscribers
expect both high quality and convenient
access to their favorite applications.
In a recent study of more than 4,700
consumers, Hot Telecom found that over
60 percent would pay more for better
coverage and speed.
Service providers own the billing
relationship and can leverage both service
quality and subscriber plan knowledge to
drive new revenues from personalized
offers. Tightly converged policy, realtime charging and product catalog are
essential to monetizing the moment
and building loyalty with high-value
combinations of HD voice, HD video and
rich communications services (RCS).
Monetizing the HD Experience
Traditionally, policy and charging have
been deployed for network resource
management, bill shock prevention, and
pre-paid service offers. Monetization
use cases focused on time and volume
basic variations of shared wallet and
tiered data plans, as well as zero rated or
flat rate social packages.
So whats changing? LTE brings greater
speed, capacity and Quality of Service
32

INSIGHTS RESEARCH

(QoS) control, enabling new services

like VoLTE. It also makes the policy and
charging rules function (PCRF) mandatory
in the network to guarantee QoS for HD
services.
While VoLTE is arguably a utility
people expect voice service it also sets
a high bar. Ovum Research found that
80 percent of service providers think that
VoLTEs HD experience will be key to
competing with OTTs. VoLTE lays the
groundwork for value-added packages
and real-time upsells of services such
video calling and rich content sharing.
Consider Maria, a VoLTE subscriber
with an OTT video share service as part
of her package. While on a VoLTE call,
she tries to use the video share. Since
the network is highly congested and the
service is best-effort, it fails. That failure
triggers a temporary QoS upgrade offer,
which Maria accepts. The online charging
system processes the offer in real time,
while the PCRF sets up a dedicated
bearer for Marias HD video sharing
then tears it down after one hour.
Another subscriber has a work and
private profile on his smartphone, with
different QoS for video calling. Based
on his enterprise profile, hes offered
an HD boost for his personal service at
a discounted rate. He accepts and the
upgrade is instantly provisioned.
Through tight integration of policy and
charging, service providers can use HD
quality as a differentiator and monetize
real-time upgrades that provide value to
customers.
Personalization in Real Time
QoS is important, but so is moving away
from one size fits all plans and giving
customers what they want, when they
want it.
Personalized services and temporary
offers are powered by contextual
information from a wide range of sources

Service providers can use HD service

quality to engage subscribers and
monetize real-time upgrades.

subscriber billing profile, location,

usage, devices and so on. For example,
if John is consuming large amounts of
HD video, he is more likely to respond to
a speed upgrade and video content offer.
If hes roaming, data passes or flat fees
for social packages will be considered of
high value.
Rising complexity and rapid change
increase the need for real-time policy and
charging to support if/then decisions for
dynamic service offers based on network
state (congestion), subscriber state
(location, device, applications), and billing
state (tier, quota, currency balance).
According to a survey from Heavy
Reading, service providers cite the lack of
integration between policy and charging
as the primary barrier to innovation.
Rules defined in different databases
often result in longer development time,
synchronization issues and a higher
margin of error at runtime.
A centralized repository for policy and
charging rules enables dynamic monetary
1 Ovum Research, 2014

www.tmforum.org

balance management where charging

logic can be translated into real-time
service changes. Integration of network
and business systems harmonizes static
and contextual subscriber data with a
single view of service entitlements,
location, device type and access
behaviors.
Multiple catalogs become one unified
catalog capable of supporting automatic
changes to policies. Service providers
can define, configure, test and deploy
new use cases and make changes or
modifications without custom coding.
Flexible charging options such as
fixed monthly, sponsored, QoS-based,
roaming, application-based or any
combination can be enabled for multiple
customer types and profiles.
Analytics Bringing Subscriber
Awareness to Service Innovation
A unified view of policy and charging
analytics provides unique insights into the
network and the subscriber experience
data usage, applications, location, HD
service quality and more. Service providers
can use this intelligence to manage
service quality and capture revenue.
Sponsored services, for example, can be

Tightly integrated policy, charging and product catalog architecture enables service
innovation and contextual offers.
AMDOCS POLICY & CHARGING HIGH LEVEL ARCHITECTURE
BSS & UPSTREAM
MASTER ENTERPRISE CATALOG
(PRODUCT CATALOG)
SUBSCRIBER
DATA STORE

POLICY CONTROLLER (PCRF)

Gx

Rx

SUBSCRIBER
DATA STORE

Sy

OA&M

CONVERGENT CHARGING (OCS)

APP SERVER

Gy

Gy

PCEF

HOLISTIC CUSTOMER DATA MANAGEMENT

Single APIs set towards BSS for customers and business
offers management
OCS-PCRF customer data synchronization
OPTIMIZED CHARGING AND POLICY Sy INTERFACE
3GPP standard interface with prebuilt enhancements for
Diameter signaling optimization

combined with service quality guarantees

with OTT providers where revenue sharing
is based on HD delivery. Adopting a
service quality business model, service

SINGLE SOURCE OF BUSINESS POLICY DEFINITION

Unified business definition view across policy and charging
Prebuilt integration with Amdocs Master Enterprise Catalog

UNIFIED OPERATIONS AND MONITORING

Unified operation and management enabled by Amdocs
Management and Control

providers can monetize their network

resources and engage subscribers with
high-value content and applications. Policy
analytics can be used to measure, monitor

Analytics bring intelligent insights to the subscriber experience to enhance service quality and monetize new offers.

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INSIGHTS RESEARCH

33

Sponsored feature

The future of data service innovation

is clear and its personal
Integrated policy, charging and catalog drive monetization

Sy Making it Seamless
Personalization is key to increasing
brand loyalty and creating new revenue
streams, making it essential to have
dynamic communications between the
OCS and PCRF.
With the introduction of Sy in 3GPP
release 11, the PCRF can make decisions
based on real-time spending metrics from
the OCS. When subscribers reach their
prescribed limits, the PCRF knows and can
respond with any number of actions change
QoS levels, throttle data usage, trigger upsell
offers, and so on. Counters can be continually
reset and communicated to the PCRF.
Theoretically this should all just work,
and yet there are a number of challenges.
Here are a few design considerations that
can simplify or complicate your Sy
implementation:
vs. synchronous call
models: Using asynchronous call flows
across Sy optimizes performance and
limits the engineering impact of Sy
introduction on the network. Non-blocking
is critical the response on Sy should
never block Gx calls and can only be
enabled with asynchronous design.
To reduce latency, the PCRF caches
information from the OCS and forces calls
only when there is a change in the OCS.
n Diameter standards: Under Sy, the
OCS acts as a Diameter server,
handling policy counter status requests
from the PCRF client. Elements
from different vendors may require
extensive integration and interoperability
testing if there are major variations
on the interpretation of Diameter
standards. PCRF and OCS solutions
that are pre-integrated or designed for
interoperability will accelerate time to
market and reduce development impact.
n Event definition: While the standard
defines the mechanism for event
notification across Sy, it doesnt specify
the actual events between the PCRF
and the OCS. Differences in definitions
can result in synchronization issues.

Asynchronous caching model optimizes

efficiency and performance while
reducing the impact of Sy introduction
in the network.
Sy ASYNCHRONOUS CACHING CALL FLOW
1. SUBSCRIBER COMES ONLINE
Sy session established.

PCRF

INSIGHTS RESEARCH

CCA-I

4
SLA-I

OCS

RAR (OPTIONAL)

PCEF
2. SUBSCRIBER DISCONNECTS
Sy session maintained.

n Asynchronous

34

CCR-I

SLR-I
3

PCRF

SNR
5
6
SNA

OCS

3. SUBSCRIBER RE-CONNECTS
Gx session is established without need to
re-establish Sy session. New policy applied
from SNR received while subscriber offline.

PCRF

CCR-I

CCA-I

SNR
9
10
SNA

OCS

RAR (OPTIONAL)

PCEF

Asynchronous operation reduces capacity

requirements while having no impact on
Gx response latency. The asynchronous
mode assumes no counter changes while
subscribers are offline. When a subscriber
re-attaches, the PCRF sends the policy
to the GGSN without waiting for the Sy
message, improving data set-up time and
performance. If there is a change, the
new policy will be applied.

Using a pre-integrated policy and

charging platform will eliminate this
issue, but in the case of a multi-vendor
PCRF/OCS, early alignment is critical.

and adjust QCI profiles to ensure HD

video quality as part of a partnership and
monetization agreement.
Usage data can also be leveraged by
marketing and business stakeholders in
multiple ways, such as creating offers
based on subscriber consumption
behavior and dynamic segmentation.
Using this information, service providers
can design targeted prepaid top-up
promotions and innovate with new data
plan options.
Policy and Charging Powering New
Business Models
HD services have the potential to shape
the subscriber experience as the desire
for connectivity and service quality
intersects with personalized, real-time
offers that drive usage.
Innovation based on service quality
opens up opportunities in verticals such
as business services and M2M. In the
connected car, for example, service
providers can offer seamless connectivity
paired with content streaming and
sponsored advertising. Applications
for HD video and RCS can create new
service categories across areas of
customer care, remote diagnostics,
security and communications.
Monetization requires an integrated,
flexible approach to how these services
are managed and charged.
Amdocs integrated policy, charging
and product catalog are being used by
service providers to power advanced
data services while opening up two-sided
business models. Amdocs provides
a wealth of experience and solutions
across the network lifecycle that can
help service providers deliver a premium
quality of experience, cost-effectively
manage their networks and monetize
service innovation.
To learn more, visit www.amdocs.
com/monetize-the-moment
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Our sponsors

For more than 30 years, Amdocs has ensured service providers success and embraced their
biggest challenges. To win in the connected world, service providers rely on Amdocs to simplify
the customer experience, harness the data explosion, stay ahead with new services and improve
operational efficiency. The global company uniquely combines a market-leading BSS, OSS and
network control and optimization product portfolio with value-driven professional services and
managed services operations. With revenue of $3.6 billion in fiscal 2014, Amdocs and its more
than 22,000 employees serve customers in over 80 countries.
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NetCracker Technology is the proven partner for communications service providers and network
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Digital is about constructing disruptive value and creating outstanding experience in the connected
world. Winners will be players capable of leveraging their own investments and strengths through
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ZTEsoft is a subsidiary of ZTE Corporation, the largest public telecom equipment manufacturer
in China. ZTEsofts ZSmart solutions have been deployed by operators in more than 70 countries
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www.ztesoft.com

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INSIGHTS RESEARCH

35

THE NEW WORLD OF

CUSTOMER E PERIENCE
EXCITING / INTELLIGENT / DYNAMIC QoE / ACCELERATE BUSINESS VALUE

Monetize the Moment

Tightly converged policy and real-time charging are essential to engaging subscribers and monetizing
the moment. Unify network and business systems to create an exciting, intelligent and dynamic customer
experience underpinned by a determination to accelerate business value.
With Amdocs policy and charging solutions, you can:
Personalize and contextualize every customer interaction in real time
Shape quality of experience with dynamic service offers and guaranteed quality of service
Provide flexible charging options for multiple customer types and profiles
Accelerate time to market for new services across network types

Learn more at:

www.amdocs.com/monetize-the-moment

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