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Competitive Landscape: Revenue Assurance and Fraud Management for Communications Service Providers
Norbert J. Scholz
Revenue assurance (RA) and fraud management (FM) help communications service providers (CSPs) reduce inefficiencies in their front and back offices. Both have in common that they try to fix revenue loss, be it either deliberate (FM) or unintentional (RA). Until recently, most CSPs had separate organizations that handled RA and FM. FM entered mature mainstream many years ago, and every CSP now has an FM system. It has to address new challenges such as being more real-time, being more proactive, increasing automation, detecting new fraud patterns and handling new data sources. RA only gained prominence as a separate discipline in the mid-2000s. It has since entered early mainstream with its own industry associations, maturity models, blogs, printed books and independent academic research. CSPs have begun combining FM and RA using the same tools as a foundation. Vendors have followed suit by adding new features to their solutions: the FM vendors adding RA and the RA vendors adding FM modules. Key Findings
Fraud management and revenue assurance are merging. Both depend on pattern recognition and use the same tools as a foundation, such as business intelligence (BI) and extraction, transformation and loading (ETL). Both use common dashboards to combine this information. FM and RA represent services-heavy business processes and productized software solutions at the same time. Suppliers address this dilemma by providing either a flexible platform or a solution with a dedicated road map, but hardly ever can they provide both simultaneously. The growth potential for traditional FM and RA solutions is limited as the market is maturing. RA suppliers will morph into business performance management providers, embracing adjacent solutions such as customer experience management (CEM), churn management, data mining, margin management, risk management, and so on. Suppliers that look to expand beyond the CSP vertical will counter challenges from existing business performance management suppliers.
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Recommendations
CSPs should explore how they can use their existing RA and FM tools for related disciplines such as BI or risk management. CSP should choose a supplier that can grow with them in terms of platform flexibility and professional services. Suppliers must decide if they are a platform or a solutions provider. Being a platform provider improves flexibility but could limit opportunities with CSPs looking for specific solutions. Being a solutions provider improves opportunities with CSPs looking for specific solutions but limits the vendor's ability to address related solutions and make quick changes to the product if required. Suppliers should develop a strategy to face competition from vendors that specialize in BI, analytics, performance management and related solutions. This could include selectively targeting other industry verticals (such as media and entertainment, finance, utilities, and so on), or merging with other RA and FM vendors to enlarge the scale of their operations.
Publication Date: 17 December 2010/ID Number: G00209271 2010 Gartner, Inc. and/or its Affiliates. All Rights Reserved.
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TABLE OF CONTENTS
Analysis ....................................................................................................................................... 6 Competitive Situation and Trends .................................................................................... 6 RA and FM Process vs. Solution ..................................................................... 6 Market Players ................................................................................................................. 7 The Future of Competition ............................................................................................... 9 The Competitive Landscape in Three to Five Years ........................................... 10 Other Vendors Not Included in This Document .................................................. 10 Provider Strategies Impact Market Forecast ...................................................... 11 Competitive Profiles ....................................................................................................... 11 Connectiva Systems .......................................................................................... 11 Market Overview and Revenue ............................................................. 11 General Product/Service Marketing Strategy ......................................... 11 Strategy ................................................................................... 11 Vision ....................................................................................... 12 How This Provider Competes ................................................................ 12 Competitive Differentiators ....................................................... 12 Solution Components ............................................................... 12 Solution Architecture ................................................................ 13 Other .................................................................................................... 15 cVidya Networks ............................................................................................... 15 Market Overview and Revenue ............................................................. 15 General Product/Service Marketing Strategy ......................................... 16 Strategy ................................................................................... 16 Vision ....................................................................................... 16 How This Provider Competes ................................................................ 16 Competitive Differentiators ....................................................... 16 Solution Components ............................................................... 16 Solution Architecture ................................................................ 17 Other .................................................................................................... 18 HP .................................................................................................................... 19 Market Overview and Revenue ............................................................. 19 General Product/Service Marketing Strategy ......................................... 19 Strategy ................................................................................... 19 Vision ....................................................................................... 19 How This Provider Competes ................................................................ 20 Competitive Differentiators ....................................................... 20 Solution Components ............................................................... 20 Solution Architecture ................................................................ 21 Other .................................................................................................... 22 Martin Dawes Analytics (MDA) .......................................................................... 23 Market Overview and Revenue ............................................................. 23 General Product/Service Marketing Strategy ......................................... 23 Strategy ................................................................................... 23 Vision ....................................................................................... 24 How This Provider Competes ................................................................ 25 Competitive Differentiators ....................................................... 25 Solution Components ............................................................... 25 Solution Architecture ................................................................ 26 Other .................................................................................................... 28 Neural Technologies ......................................................................................... 28
Publication Date: 17 December 2010/ID Number: G00209271 2010 Gartner, Inc. and/or its Affiliates. All Rights Reserved.
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Market Overview and Revenue ............................................................. 28 General Product/Service Marketing Strategy ......................................... 28 Strategy ................................................................................... 28 Vision ....................................................................................... 29 How This Provider Competes ................................................................ 29 Competitive Differentiators ....................................................... 29 Solution Components ............................................................... 29 Solution Architecture ................................................................ 30 Other .................................................................................................... 32 Subex ............................................................................................................... 32 Market Overview and Revenue ............................................................. 32 General Product/Service Marketing Strategy ......................................... 32 Strategy ................................................................................... 32 Vision ....................................................................................... 33 How This Provider Competes ................................................................ 33 Competitive Differentiators ....................................................... 33 Solution Components ............................................................... 33 Solution Architecture ................................................................ 34 Other .................................................................................................... 35 Teoco ................................................................................................................ 36 Market Overview and Revenue ............................................................. 36 General Product/Service Marketing Strategy ......................................... 36 Strategy ................................................................................... 36 Vision ....................................................................................... 37 How This Provider Competes ................................................................ 37 Competitive Differentiators ....................................................... 37 Solution Components ............................................................... 37 Solution Architecture ................................................................ 38 Other .................................................................................................... 38 WeDo Technologies .......................................................................................... 39 Market Overview and Revenue ............................................................. 39 General Product/Service Marketing Strategy ......................................... 39 Strategy ................................................................................... 39 Vision ....................................................................................... 39 How This Provider Competes ................................................................ 40 Competitive Differentiators ....................................................... 40 Solution Components ............................................................... 40 Solution Architecture ................................................................ 40 Other .................................................................................................... 42 References and Methodology ........................................................................................ 42 Recommended Reading ............................................................................................................. 42
LIST OF TABLES
Table 1. Overview of RA and FM Vendors .................................................................................... 8 Table 2. Delivery Options by RA and FM Vendors ........................................................................ 8
Publication Date: 17 December 2010/ID Number: G00209271 2010 Gartner, Inc. and/or its Affiliates. All Rights Reserved.
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LIST OF FIGURES
Figure 1. Connectiva's Revenue Assurance and Fraud Management Solution Architecture......... 14 Figure 2. cVidya's Revenue Assurance and Fraud Management Solution Architecture................ 18 Figure 3. HP's Revenue Assurance and Fraud Management Solution Architecture ..................... 22 Figure 4. MDA's Revenue Assurance and Fraud Management Solution Architecture .................. 27 Figure 5. Neural Technologies' Revenue Assurance and Fraud Management Solution Architecture ................................................................................................................................ 31 Figure 6. Subex's Revenue Assurance and Fraud Management Solution Architecture ................ 35 Figure 7. Teoco's Revenue Assurance and Fraud Management Solution Architecture ................ 38 Figure 8. WeDo's Revenue Assurance and Fraud Management Solution Architecture ................ 41
Publication Date: 17 December 2010/ID Number: G00209271 2010 Gartner, Inc. and/or its Affiliates. All Rights Reserved.
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ANALYSIS
Publication Date: 17 December 2010/ID Number: G00209271 2010 Gartner, Inc. and/or its Affiliates. All Rights Reserved.
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order entry, order management, churn management, quality of service management, and so on. Business Assurance Optimizes business outcomes. Processes include cash management, financial analysis, margin management, and so on. Service Assurance/Quality Assurance Provides CSPs with insights into individual services inside the service transport layer, and how these services are performing. Processes include service problem management, service configuration and activation, and so on. Network Assurance Ensures proper operation of the network. Processes include resource provisioning, resource data management, and so on. Productized Solutions Productized solutions that tend to be most closely associated with RA include: customer experience management, dealer commissions management, trade and settlement, partner settlement, risk management, compliance management, and others. For vendors, this dual nature of RA and FM has the following implications: There is always a high degree of consulting work involved, even if the solutions claim to be out-of-the-box. No single vendor can productize all the possible solutions required by CSPs because of evolving requirements and the limited bandwidth of most suppliers. Vendors are left with two options: 1. Add new modules as required by their customers. Advantage: Repeatability; makes marketing and sales efforts more impactful. Disadvantage: It requires high R&D investment and a dedicated road map. 2. Develop a platform that CSPs can easily customize according to their own requirements. Advantage: Wider reach within CSP organizations. Disadvantage: Hard to market to CSPs looking for specific solutions.
Market Players
Suppliers featured in this report were selected based on their 2009 revenue from software license sales in the category "revenue assurance and fraud management" (see "Market Share: Telecom Operations Management Systems (BSS, OSS and SDP), Worldwide, 2007-2009"). Suppliers had to have a global customer base and solution with a dedicated product road map. The rationale was to focus on software-based solutions and exclude providers of customized solutions and professional services. Table 1 provides a summary of the players covered in this study; Table 2 shows their delivery options. Functionality All suppliers provide basic functionality such as business intelligence, business rules, data integration, enterprise application integration (EAI), interconnect auditing and network auditing. In addition, all suppliers under consideration have a range of consulting services alongside their software solutions. For details, see the individual profiles.
Publication Date: 17 December 2010/ID Number: G00209271 2010 Gartner, Inc. and/or its Affiliates. All Rights Reserved. Page 7 of 43
Delivery Options There is some variation in the delivery options and pricing schemes offered as shown in Table 2. Standard licensing is most common, but cloud/software as a service (SaaS) and managed services are more or less standard now, although the accounting units vary. Managed services and contingency-based pricing are less widespread. Table 1. Overview of RA and FM Vendors
Vendor Name Connectiva Systems Solution Names Affirm Sentry CEM Integrated Revenue Intelligence Solutions (IRIS) CentralView Fraud Risk Management CentralView Revenue Leakage Control CentralView Roaming Fraud Control CentralView Subscription Fraud Prevention CentralView Dealer Performance Audit Lavastorm Analytic Platform Minotaur MinotaurCloud MinotaurInsight Subex Teoco WeDo Technologies
Source: Gartner (December 2010)
URL www.connectivasystems.com
cVidya Networks HP
140+ 100+
www.cvidya.com www.hp.com/go/centralview
38 45
www.mda-data.com www.neuralt.com
ROC Revenue Assurance ROC Fraud Management Sonar Bill TrakPro and View Logic Business Assurance RAID
180+ 47 60+
Publication Date: 17 December 2010/ID Number: G00209271 2010 Gartner, Inc. and/or its Affiliates. All Rights Reserved.
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Connectiva # of CPUs # of Controls # of xDRs Software Rental Hosted/SaaS/Service Bureau Initial Set-Up Fee # of Modules # of Subs # of Users Processing Volume Monthly Fee Annual Fee Managed Services Performance-Based Revenue Sharing X X X X X X
cVidya
HP
MDA X X
NT
Subex
Teoco
WeDo
X X X X X X X X
X X*
X X X X X X X X X X X X X X X X X X X X X X
* Planned for 2011 FM = fraud management; RA = revenue assurance; SaaS = software as a service; xDR = x detail record Source: Gartner (December 2010)
Publication Date: 17 December 2010/ID Number: G00209271 2010 Gartner, Inc. and/or its Affiliates. All Rights Reserved.
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Results: Prediction 3 turned out to be correct, although the network management element is still lagging. The key theme for assessing the future of competition is that CSPs can use common FM and RA tools, namely BI, ETL tools and common dashboards for a number of purposes outside traditional FM and RA departments. It is possible that RA and FM will assume much broader responsibilities, potentially expanding into strategy and finance functions, that can be loosely classified as "business performance management."
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Advanced Technologies & Services (ATS), www.atso.com (RA) Allround, www.allround.net (RA and FM) Araxxe, www.araxxe.com (RA) Basset, www.bassetglobal.com (RA and FM) Beck Computer Systems, www.beckcomputers.com (FM) Capana, www.capana.com (RA) Cartesian (a TMNG Global company), www.cartesian.com (RA) Comware, www.comware.com.tw (FM) Equinox Information Systems, www.equinoxis.com (RA and FM) Honovi Solutions, www.honovi.com (RA) Teleonto, www.teleonto.com (RA) Xintec, www.xintec.com (RA and FM)
Competitive Profiles
Connectiva Systems
Market Overview and Revenue
Connectiva Systems' RA and FM portfolio includes the following products: Connectiva Affirm (RA), Connectiva Sentry (FM) and Connectiva CEM (customer experience management). In 2009, Connectiva's revenue from revenue assurance and fraud management amounted to over $30 million, according to Gartner estimates. The Middle East and Africa region was its largest market with $15 million, followed by Asia/Pacific with $6 million, Western Europe with $6 million and North America with $3 million.
Publication Date: 17 December 2010/ID Number: G00209271 2010 Gartner, Inc. and/or its Affiliates. All Rights Reserved.
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In addition to software licenses and hosted solutions, Connectiva provides business consulting, technology, implementation and managed services. Key partners include: Technology partners: Oracle, IBM, HP, i2 and Tekno Telecom. SI and channel partners: Ericsson, IBM, Tech Mahindra, T-Systems, Protiviti, ITC, HCL, Alcatel-Lucent, TCS, Wipro and Nokia Siemens Networks. Vision Connectiva's vision for RA and FM includes the following elements: RA is morphing from reactive leakage identification to a more holistic revenue optimization function that can proactively identify disconnects, prevent opportunity losses and bridge the gap between customer satisfaction and RA functions. RA and FM will converge on the IT side under a common owner, especially in emerging markets. Customer experience analytics will merge with RA as both domains leverage similar sets of data and analytic services in identifying revenue and customer experience disconnects Connectiva aims to become a leading provider of subscriber data monetization solutions that can find hidden insights and translate them to five key business outcomes: (1) reduce leakage, (2) minimize fraud, (3) proactively reduce churn, (4) Increase subscriber average revenue per unit (ARPU) and (5) increase channel ARPU.
Telecom-specific data model with prepackaged RA and FM story boards. Interactive data visualization tools that enable business users to interact with data at both summary and detailed levels in real time. Business Rules A common rule engine with a user-friendly interface that can be deployed across RA and FM applications and in both batch and real-time modes. Data Integration Built on a "Configure and Not Code" philosophy, all Connectiva applications (including RA, FM and CEM) are built on a common schema and metadata layer and leverage a common set of analytic services and business process infrastructure. The solution can integrate to both unstructured and structured data sources and offers native ETL capabilities optimized for a telecom environment. EAI All analytics engines are exposed as Web services and can respond to calling third-party applications. They are also built on a virtual data model abstraction and can consume information from both third-party data sources and applications. Interconnect Auditing The solution is designed to analyze both revenue and cost elements of interconnect events and calculate margins for every customer event by correlating data across retail and wholesale. Network Auditing The solution delivers end-to-end audit and assurance across all network elements in varied telecom environments, ranging from wireline, prepaid and postpaid mobile to cable quad-play and satellite. Assurance is comprehensive and includes audits across all network-recorded activity, configurations and errors. Others Smart Discovery Engine: The solution can auto-detect anomalies, patterns and outliers, and raise alerts and insights. Based on a patented Darwinian statistical model, this capability allows for investigating the unknown unknowns and constantly finding new sources of leakage, fraud and customer experience disconnects. Connectiva also offers fingerprinting and profiling services that enable proactive detection and identification of fraud and leakage. Solution Architecture Figure 1 shows the architecture of Connectiva's RA and FM solution.
Publication Date: 17 December 2010/ID Number: G00209271 2010 Gartner, Inc. and/or its Affiliates. All Rights Reserved.
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Publication Date: 17 December 2010/ID Number: G00209271 2010 Gartner, Inc. and/or its Affiliates. All Rights Reserved.
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Other
Major clients: Over 40 in total. Examples include Wataniya (Kuwait), Bharti Africa, STC (Bahrain), Idea Cellular (India), YTL (Malaysia), Videotron (Canada), Bharat Sanchar Nigam (India), Tunisiana (Tunisia), Bharti (India), T-Mobile (USA), T-Mobile International (Europe), Telefnica (Spain) and Bell Canada (Canada). Pricing strategy: Connectiva offers four pricing models: Enterprise application license with per-subscriber license fees. Enterprise application license with per xDR license fees. Subscription usage model over fixed term with per-month standard pricing (based on subscribers and/or xDRs); includes a license buy-out option at the end of the term. SaaS (on-site or hosted) where Connectiva owns the infrastructure, performs the implementation and offers the entire solution stack as a service. The pricing is on a monthly basis and is blended across hardware, database, operating system, application software, implementation and deployment support. Additional models offered: Outcome-based pricing models that charge for the solution based on outcomes delivered, such as leakage found, fraud identified, specific increase in ARPU because of campaigns delivered, and so on. Managed service options that enable providers to outsource their operational revenue management functions to Connectiva. Acquisitions since 2000 that support the RA and FM solution are as follows: Olista (2010): The solution's capabilities include smart discovery engine, social network analysis, action engine and funnel analytics. All elements of Olista's technology have been integrated into RA and FM applications. The assimilation of Olista capabilities into Connectiva's core platform provides CSPs with an integrated subscriber data monetization platform that can help optimize revenue holistically across multiple domains (revenue assurance, cost management, fraud, retention and upsell/cross-sell).
cVidya Networks
Market Overview and Revenue
cVidya's RA and FM portfolio includes the following product: Integrated Revenue Intelligence Solutions (IRIS). In 2009, cVidya's revenue from RA and FM amounted to nearly $28 million, according to Gartner estimates. Western Europe was its largest market with $13 million, followed by Latin America with $6 million, and North America, Western Europe, Eastern Europe and Asia/Pacific with around $3 million each.
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Following the acquisition of ECtel in early 2010, and after adding FM and margin analytics products to the portfolio, the combined revenue for 2010 is estimated at $60 million, with the following regional breakdown: Western Europe $17 million, Latin America $11 million, North America $12 million, Eastern Europe $9 million, Asia/Pacific $4 million and Africa $7 million.
Publication Date: 17 December 2010/ID Number: G00209271 2010 Gartner, Inc. and/or its Affiliates. All Rights Reserved.
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Business Rules Advanced graphical user interface (GUI) where end users can define business rules and/or apply roles form a large library of predefined roles. Data Integration Utilizing ETL capabilities, including OEM capabilities from vendors like Informatica, to provide an ETL and data integration layer. EAI Using advanced EAI tools, including a set of predefined APIs, enables fast integration of all the data sources needed to support the revenue intelligence functionality. Interconnect Auditing Portfolio includes a dedicated solution for interconnect auditing, as well as a settlement- and portal-based dispute mechanism to reconcile with external telecom vendors, content partners, and more. Network Auditing MoneyMap switch-to-bill reconciliation helps indentify faults and errors on the network level, and generates the relevant trouble ticket to the network team. Others: Unified Revenue Assurance and Fraud Management The integrated solution shares common infrastructure elements such as data acquisition, case management, reporting, and so on. Dealers commission management; margin/pricing analytics; and EZTrust, which is a set of cost assurance tools that assists the invoice reconciliation process between carriers and includes a dispute settlement mechanism. Solution Architecture Figure 2 shows the architecture of cVidya's RA and FM solution.
Publication Date: 17 December 2010/ID Number: G00209271 2010 Gartner, Inc. and/or its Affiliates. All Rights Reserved.
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IRIS = Integrated Revenue Intelligence Solutions; ETL = extraction, transformation and loading; RHEL = Red Hat Enterprise Linux; JDBC = Java Database Connectivity; OLE DB = Object Linking and Embedding Database; OLAP = online analytical processing; MS SSAS = Microsoft SQL Server Analysis Services Source: cVidya
Other
Major clients: Over 140, including AT&T (U.S.), BT (U.K.), Telefnica Group, O2, Vodafone, MTN (South Africa), Orange and Bell Canada. Pricing strategy: cVidya's pricing strategy is as follows:
Publication Date: 17 December 2010/ID Number: G00209271 2010 Gartner, Inc. and/or its Affiliates. All Rights Reserved.
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A setup fee is charged for the IRIS infrastructure, and a license fee for each application based on the number of subscribers or transactions. Consulting, professional services, maintenance and support are charged in addition. A cloud/SaaS model with a managed services option, in which the customers pay an initial setup fee, and a monthly fee for a certain period of time based on the number of users or processing volume. Acquisitions since 2000 that support the RA and FM solution are as follows: ECtel (2009): ECtel previously acquired Compwise (2008), Elron Telesoft (2005) and Telrad's Hawk NET-I product (2001).
HP
Market Overview and Revenue
HP's RA and FM portfolio currently includes the following products: CentralView Fraud Risk Management and CentralView Revenue Leakage Control, CentralView Roaming Fraud Control, CentralView Subscription Fraud Prevention, and CentralView Dealer Performance Audit. In 2009, HP's revenue from RA and FM amounted to around $40 million, according to Gartner estimates. Western and Eastern Europe were its largest markets with around $27 million together, followed by the Americas with around $9 million and Japan with around $1 million.
Publication Date: 17 December 2010/ID Number: G00209271 2010 Gartner, Inc. and/or its Affiliates. All Rights Reserved.
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FM will be coupled with policy control and deep packet inspection (DPI) probes. Risk documentation and demonstration will become increasingly important. Decreased total cost of ownership (TCO) will drive CSP investments in RA and FM: Cost reductions and the need for a holistic view of security will drive a consolidation of CSP departments. The IT department will manage risk and revenue assurance applications jointly, but the control will be assigned to different teams belonging to the same risk management department. Increased adoption of Internet Protocol (IP) networks will create synergies with security and operations, when flat-rate plans are phased out and customers begin to be charged by tiers. Tools will be increasingly integrated, sharing the same platform and supporting multiple concurrent products for information sharing across applications and economies of scale. Scalable Linux on Blades system will dominate the scene. SaaS support for RA and FM will be more affordable for customers with limited budgets.
Publication Date: 17 December 2010/ID Number: G00209271 2010 Gartner, Inc. and/or its Affiliates. All Rights Reserved.
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each product, while extensions are supported. Most of the CentralView applications come with a scoring engine based on IBM/SPSS Modeler. Business Rules A set of parallelized processes provide maximum flexibility to configure and implement in a timely manner the business rules required for the task. Data Integration Applications are supported by a data collection and cleaning layer based on an embedded mediation product. The layer provides a robust user interface to add new data streams and monitor the runtime performances of the collection layer. A configurable rating engine allows users to enrich un-rated network events with charging information. EAI Northbound EAI via Common Object Request Broker Architecture (CORBA) and Web services to other back-office systems (credit checks, provisioning, and so on) and southbound integration via network protocols like Diameter (for example, DPI integration). Interconnect Auditing Interconnect Invoices Verification gives CSPs a complete workflow, covering the entire validation process end to end, including management of disputes. This applies to traditional voice interconnection and any kind of partnership, including contents and merchants (e-commerce or m-commerce). Network Auditing Policy is supported by the HP Subscriber, Network and Application Policy (SNAP) portfolio. CentralView will expand into network auditing using the same platform, with the goal of detecting and blocking in real-time suspicious activities using DPI probes. The acquisitions of Fortify and Arcsight will be leveraged to provide timely alarms to the FM application. Others CentralView replaces traditional service/traffic monitoring through a revenuegeneration, or cost-generation, chains monitoring schema based on entities/events. This allows the use of the framework in many distinct manners such as network auditing, billing auditing, roaming and interconnect auditing, partnership controlling, credit management such as monitoring of a non-telco assets, retail chains, dealers networks, usage of credit cards, and so on. KPI engine and online analytical processing (OLAP) cubes KPI engine provides maximum flexibility to configure and implement KPIs defined on data sources (OLAP cubes or summary relational tables), to provide control points and alarms for abnormal situations. Case management Investigation and analysis tools support case management and incident management workflow and help review supporting data, resolve cases and take counteractions. Audit and security Audit and security features of the solution have been implemented according to European Union regulations and guidelines for confidential data retention. Solution Architecture Figure 3 shows the architecture of HP's RA and FM solution.
Publication Date: 17 December 2010/ID Number: G00209271 2010 Gartner, Inc. and/or its Affiliates. All Rights Reserved.
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BO = Business Objects; MSQL = Microsoft SQL; OLAP = online analytical processing; IIS = Internet Information Services; DB = database; KPI = key performance indicator; ETL = extraction, transformation and loading; BODS = BusinessObjects Data Services; GUI = graphical user interface Source: HP
Other
Major clients: Over 100 in total, including Bouygues Telecom (France), Vodacom (South Africa) and Vodafone (Netherlands). Pricing strategy: HP CentralView applications offers four pricing models: Per-subscriber license model, where the cost of the license is proportional to the number of customers protected. The license cost is divided into tiers, and has a decreasing cost per tier in line with the increase in the number of subscribers.
Publication Date: 17 December 2010/ID Number: G00209271 2010 Gartner, Inc. and/or its Affiliates. All Rights Reserved.
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Per-transaction license model, where the cost of the license is proportional to the volume of transactions monitored. The license cost is divided into tiers, and has a decreasing cost per tier in line with the increase in the number of transactions. Pay per usage, where the customer pays a license rental fee proportional to usage during a period of time. SaaS, where the customer pays only a fee, for hardware, software, services and support. Acquisitions since 2000 that support the RA and FM solutions are as follows: The applications have been originally developed in Digital Equipment Corporation/Compaq, subsequently acquired by HP (2001). HP performed all development in-house.
Publication Date: 17 December 2010/ID Number: G00209271 2010 Gartner, Inc. and/or its Affiliates. All Rights Reserved.
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feasibility can develop indicative results to frame the business case, and can get a sense on how to structure the program post-POC. Most MDA POCs can be accomplished in about three days. MDA works with its partners to provide the tools and systems to create partner- and customer-defined solutions. These solutions are, today, deployed in the communications, media, utility, financial services and transportation industries. MDA offers a set of professional services including design, coaching and training, peering, and implementation services. MDA also provides managed services. Key partners include: Technology partners: MicroStrategy, Oracle, Red Hat, Netezza and SAS. Solution partners: PwC, Ernst & Young and PRTM. SI partners: Accenture, IBM, Capgemini, Ericsson, Synaptitude and Cognizant. Vision MDA's vision for revenue assurance and fraud management includes the following elements: Continue to advance the discovery, analytics, control and case management capabilities of AdaptiveRA and AdaptiveFMS to improve detection and resolution of errors and threats, and maximize the financial value of the solutions. To support demand for more collaborative process discovery and analytic capabilities, especially in new areas of interest where process behavior and the nature and extent of risk are less known, MDA is investing in visualization and collaboration capabilities to enhance process discovery, modeling, pattern recognition and process analytics. RA and FM will move more toward real-time with a greater level of automated resolution. This is to respond to more organized, sophisticated fraudsters and to address risk as it occurs, and before it affects customers or revenue performance. MDA is investing in performance enhancements, including in-memory processing, as well as a new case management capability to enable customers to maximize financial productivity, and increase the extent to which resolution is automated. Enterprises will require greater flexibility and expect that systems can be rapidly changed, added to, and tuned to address changing threats, risks and priorities. MDA is expanding both its technology platform and solutions to enable customers to rapidly, and if desired autonomously, adapt to changing risks and priorities. Enterprises will require greater data and analytic leverage from RA and FM to provide an analytic environment that addresses different business needs (customer experience, service delivery, process optimization, and so on) and deliver a superior business case. To achieve leverage, MDA is investing in analytic IP, to include reader formats, analytic nodes, and RA and FM controls to help providers accelerate and maximize financial value. RA and FM systems will continue to scale to meet growing CDR levels; for example, MDA processes more than 1.5 billion records a day for customers, and it expects to see a fivefold increase in CDR volumes over the next five years. MDA is investing in order to scale all products to keep up with growing volumes, yet maintain the analytic rigor needed to identify data and logic issues that impact revenue and detect fraud.
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Publication Date: 17 December 2010/ID Number: G00209271 2010 Gartner, Inc. and/or its Affiliates. All Rights Reserved.
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Network Auditing Provided as part of usage analytics, migration assurance and asset management. It reconciles physical and logical assets, identifies stranded or under-utilized assets, or identifies assets that may be causing issues. These efforts are tied to both post-merger, post consolidation, modernization and ongoing operations efforts. Others In addition to RA and FM, MDA focuses on the following solutions: customer experience management, dealer commission management, service delivery performance, migration assurance, trade and settlement, and risk and compliance. Solution Architecture Figure 4 shows the architecture of MDA's RA and FM solution.
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Publication Date: 17 December 2010/ID Number: G00209271 2010 Gartner, Inc. and/or its Affiliates. All Rights Reserved.
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Other
Major clients: 38 in total, including AT&T (U.S.), BT (U.K.), Comcast (U.S.), Cox (U.S.), KPN (Netherlands), M1 (Singapore), Mobistar (Belgium), MTN (Nigeria), MTS Allstream (Canada), Play (Poland), RCN Metro, Telia (Denmark), TeliaSonera (Sweden), Telstra (Australia), Telus (Canada), Verizon Wireless (U.S.), Vodafone (Greece, Ghana), Windstream Communications (U.S.), Yes Optus (Australia), Yoigo (Spain) and Ziggo (Netherlands). Pricing strategy: MDA's pricing strategy is as follows: The platform bid price is an amalgamation of the different composing products and services. The LD is priced on a per-user basis, putting no functional limitations on them. The LAE is priced on a per-CPU basis, as this presents the best platform opportunity to apply the analytic to any data and process issue. The LTW (which is most typically deployed in the context of the platform), is priced in terms of usage volumes, data sources (readers) and number of controls applied. The LDR based on the base capability, plus format types as add-ons. The LRC is priced on a per-user basis. Additionally, MDA offers a managed services model that is priced in terms of set-up and ongoing management. Acquisitions since 2000 that support the RA and FM solution are as follows: Visual Wireless (2006). Visual Wireless had previously acquired Avesta (2000). Lavastorm (2005).
Neural Technologies
Market Overview and Revenue
Neural Technologies' RA and FM portfolio includes the following products: Minotaur, MinotaurCloud and MinotaurInsight. In 2009, Neural Technologies' revenue from RA and FM amounted to nearly $15 million, according to Gartner estimates. North America was its largest market with $6 million, followed by the Middle East and Africa with $3 million, and Latin America, Western Europe, Eastern Europe and Asia/Pacific with around $2 million each.
Publication Date: 17 December 2010/ID Number: G00209271 2010 Gartner, Inc. and/or its Affiliates. All Rights Reserved.
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Neural Technologies offers a range of consulting services including analytical modeling, fraud management consulting, revenue assurance consulting, configuration services and outsourced services. Key partners include: Technology partners: DigitalRoute, Oracle and Microsoft. SI and channel partners: Dimension Data, T-Systems, Sopra, Ellipz, Concillium, TCS and Alcatel-Lucent. Others: TCL Global (testing), TRMG Global (consultancy) and APS (intelligence). Vision Neural Technologies' vision for RA and FM includes the following elements: RA will evolve into business intelligence/analytics to provide revenue protection and enhancement. This will allow CSPs to understand their customers, network, channels, and so on in a multidimensional view of potential revenue maximization, revenue loss detection, financial exposure and risk, allowing for a real-time proactive approach (not reactive) to understanding their business at any time. From an architectural point of view, transaction analysis and BI will be tightly integrated. Co-operative data collection will allow more effective management of data volumes introduced by LTE and DPI. Credit management and cost management will become an integral part of RA.
Publication Date: 17 December 2010/ID Number: G00209271 2010 Gartner, Inc. and/or its Affiliates. All Rights Reserved.
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Business Rules In Minotaur, rules are designed to detect certain events that present a risk. If one of these events occurs then an alarm is raised. The rules are generated using Boolean statements; for example, if there's high consumption of calls but minimal payment activity, then raise an alarm. Data Integration This forms part of the mediation and data preprocessing stage, using data from external sources, primarily event EDR streams and customer data streams. NT provides a mediation platform, the Conversion Interface Manager (CIM). EAI Via the CIM as described above. Interconnect Auditing Minotaur can reconcile interconnect traffic with partner invoices to identify discrepancies with the help of the Minotaur reconciliation component (MRC). Further reconciliation can be performed during the settlement process with detailed CDRs and partner CDRs. Network Auditing Not relevant to NT. Others CSPs can use NT's analytical models to improve operations, including marketing (by identifying only the relevant people to receive a specific offer or product), cross-sell and upsell (by exploring linkages between the products and services customers presently buy and the ones they might be persuaded to buy), customer retention (by offering special products, discounts, increasing credit limits, advising different products and plans), identifying customer lifetime value, and expediting the collections process. Solution Architecture Figure 5 shows the architecture of Neural Technologies' RA and FM solution.
Publication Date: 17 December 2010/ID Number: G00209271 2010 Gartner, Inc. and/or its Affiliates. All Rights Reserved.
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Figure 5. Neural Technologies' Revenue Assurance and Fraud Management Solution Architecture
CIM = conversion interface manager; CSV = comma-separated values; ASCII = American Standard Code for Information Interchange; BER = basic encoding rules; (S)FTP = (secure) file transfer protocol; DB = database; IP = Internet Protocol; SNMP = Simple Network Management Proto col; GTP = GPRS Tunnelling Protocol; CDR = call detail record Source: Neural Technologies
Publication Date: 17 December 2010/ID Number: G00209271 2010 Gartner, Inc. and/or its Affiliates. All Rights Reserved.
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Other
Major clients: 45 in total, including Kingston Communications (U.K.), O2 (U.K.), Orange (Switzerland, Poland, U.K.), Telstra (U.K.), SFR (France), TDC (Denmark), Turkcell (Turkey), VimpelCom (Russia), GCI Communication (U.S.), DirecTV (U.S.), GE Money (U.S.), Sprint (U.S.), T-Mobile USA, Axtel (Mexico), Oi (Brazil), Digi (Malaysia), Digitel (Philippines), HDFC Bank (India), M1 (Singapore), Maxis (Malaysia), Telecom New Zealand, Meditel (Morocco), MTN (South Africa), Sunrise, (Switzerland) Telkom SA (South Africa) and Zain (Bahrain, Iraq, Kuwait). Pricing strategy: Neural Technologies typically prices license implementations based on either subscriber numbers or data throughput, with additional costs for deployment activities and ongoing annual maintenance. The company also offers other pricing models, such as performance-based revenue share, rental options and monthly/annual service fees for hosted environments. Acquisitions since 2000 that support the RA and FM solution are as follows: FICO, previously Fair Isaac (LiquidCredit for Telecom, 2009). Fair Isaac had previously acquired HNC Software (2002). HNC had previously acquired Systems/Link (2000) and Bedford Associates' ATAC product line (1998). Prime Creation Technology (PCT) Hong Kong (2009). Cerebrus Solutions (2004).
Subex
Market Overview and Revenue
Subex's RA and FM portfolio includes the following products: ROC Revenue Assurance and ROC Fraud Management. In 2009, Subex's revenue from RA and FM amounted to nearly $41 million, according to Gartner estimates. EMEA and the Americas were its largest markets with over $16 million each, followed by Asia/Pacific with $8 million.
Publication Date: 17 December 2010/ID Number: G00209271 2010 Gartner, Inc. and/or its Affiliates. All Rights Reserved.
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SI and channel partners: Accenture, IBM, Alcatel-Lucent, Nokia Siemens Networks, Infosys, Wipro, Tech Mahindra and BT Global Services. Regional partners: Gantek, Comverse, TCS, Ericsson, ITS, Soin International and TIS. Vision Subex's vision for RA and FM includes the following elements: RA and FM will become subsets of ROC, which most CSPs will build to manage the end-to-end revenue and risks associated with revenue. Revenue operations applications will move to the cloud as CSPs want the benefits from ease of deployment, lower costs, the flexibility in the ability to assess ROI, and discontinue use if perceived value falls.
Publication Date: 17 December 2010/ID Number: G00209271 2010 Gartner, Inc. and/or its Affiliates. All Rights Reserved.
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process and load ASCII, ASN.1, XML, binary and comma-separated values (CSV) formats. It also support data integrity validations on various fields and file structure. EAI With the help of APIs, the ROC Revenue Assurance and ROC Fraud Management solutions can be integrated with EAI solutions to leverage organizational knowledge inside the existing IT infrastructure of telecom operators. Interconnect Auditing ROC Revenue Assurance ensures accurate accounting of inbound and outbound interconnect traffic. ROC Fraud Management provides capabilities to tackle SIMBox abuse, re-filing, international revenue share fraud (IRSF) and other bypass-related frauds through its "Bypass Fraud Module." Discrepancies within interconnect partners against agreements, unsupervised changes within the routing tables, and unauthorized modification to interconnect rating can be identified through volume-based monitoring and monitoring of system audit log files. The Internal Affairs module can identify scenarios where privileges are abused by network personnel. Network Auditing ROC Revenue Assurance can process usage and subscription data from network elements to detect revenue leakage. Usage data from switch and Signaling System 7 (SS7) probes can be reconciled to identify suppressed usage, missing usage data in the switch due to misconfiguration or outage. Subscriber and service reconciliation between the home location register (HLR) and intelligent network (IN)/billing system can detect fraudulent service activation in the network. Solution Architecture Figure 6 shows the architecture of Subex's RA and FM solution.
Publication Date: 17 December 2010/ID Number: G00209271 2010 Gartner, Inc. and/or its Affiliates. All Rights Reserved.
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MSC = mobile switching center; ETL = extraction, transformation and loading; GGSN = Gateway GPRS Support Node; IN = intelligent network; NRTRDE = Near Real-Time Roaming Data Exchange; TAP = Transferred Account Procedure; ROC = Revenue Operations Center; GPRS = general packet radio service; IP = Internet Protocol; DICE = Dynamic Intuitive Cube Engine Source: Subex
Other
Major clients: Over 180 in total, including Aircel (India), AT&T (U.S.), du (UAE), Bell Canada, BT Global Services (U.K.), Claro (Brazil, Dominican Republic, Puerto Rico), Embarq (U.S.), France Telecom, Level 3 (U.S.), PLDT (Philippines), Rogers (Canada), STC (Saudi Arabia), Swisscomm (Switzerland), Telecom Egypt, Telkom Indonesia and Vodafone (India, Ireland, Italy, New Zealand, Romania, Turkey). Pricing strategy: Subex's pricing strategy is as follows: License models based on:
Publication Date: 17 December 2010/ID Number: G00209271 2010 Gartner, Inc. and/or its Affiliates. All Rights Reserved.
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Number of records or transactions processed. Number of users. Number of subscribers. Value-based pricing models, such as a risk-reward share model. Hosted/service bureau models. SaaS/cloud-based models. End-to-end managed services. Acquisitions since 2000 that support the RA and FM solution are as follows: Azure Solutions (2006): Azure had previously acquired Anite Calculus (2004), Connexn Technologies (previously known as The Hutton Company) (2004) and Monnet (2004): Connexn had previously acquired Telecomms Consultancy & Solutions (2003). Anite had previously acquired Calculus Solutions (2000), Delta Partners (2001) and Syzygy Solutions (2000). Mantas (2006): Mantas had previously acquired SOTAS (2003): SOTAS had previously acquired S3net (2000). Magardi (2001).
Teoco
Market Overview and Revenue
Tecoc's RA and FM portfolio includes the following products: Sonar, BillTrak Pro and ViewLogic. In 2010, the combined revenue from RA and FM of Teoco and the recently acquired TTI Telecom is expected to amount to around $80 million, according to Gartner estimates. North America was its largest market with around $60 million, followed by EMEA with around $15 million, and all other geographies with $5 million. These numbers include the TTI Telecom acquisition.
Publication Date: 17 December 2010/ID Number: G00209271 2010 Gartner, Inc. and/or its Affiliates. All Rights Reserved.
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Vision Teoco's vision for RA and FM includes the following elements: RA and FM will converge, with both capabilities moving onto a common platform, with the ability to incorporate and report on new technologies and record formats. With the ability to correlate costs, RA has evolved into margin management. More real-time visibility from the network and deeper analytics on both voice and data will provide a more comprehensive and end-to-end view.
Publication Date: 17 December 2010/ID Number: G00209271 2010 Gartner, Inc. and/or its Affiliates. All Rights Reserved.
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Solution Architecture Figure 7 shows the architecture of Teoco's RA and FM solution. Figure 7. Teoco's Revenue Assurance and Fraud Management Solution Architecture
IP = Internet Protocol; TG = trunk group; MOU = minutes of use; MB = megabyte; MSC = mobile switching center; EDR = event detail record Source: Teoco
Other
Major clients: Qwest (U.S.) and Sprint (U.S.). Pricing strategy: Teoco's solutions are offered as a fully-hosted SaaS solution or as a managed service. It can be hosted exclusively at one of Teoco's data centers, or on the CSP's site, usually
Publication Date: 17 December 2010/ID Number: G00209271 2010 Gartner, Inc. and/or its Affiliates. All Rights Reserved.
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with Teoco hardware. The pricing model is a monthly recurring fee based on size and number of modules. Acquisitions since 2000 that support the RA and FM solution are as follows: TTI Telecom (2010). Vero Systems (2008): Vero had previously acquired certain assets from ADC's Services Fulfillment Division. Vibrant Solutions (previously known as InformationView Solutions) (2006): Vibrant had previously acquired Longitude Systems (2001), Network Audit Control (2001) and TeleCon (2000).
WeDo Technologies
Market Overview and Revenue
WeDo Technologies' RA and FM portfolio includes the following product: Business Assurance RAID 6.0. By the end of 2010, WeDo Technologies' revenue from RA and FM will amount to $56 million, according to Gartner estimates. Western Europe will be the largest market with $23 million, followed by Latin America with $19.5 million, the Middle East and Africa and Eastern Europe with $5 million, Asia/Pacific with $4.5 million and Central and Eastern Europe with $4 million.
Publication Date: 17 December 2010/ID Number: G00209271 2010 Gartner, Inc. and/or its Affiliates. All Rights Reserved.
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Publication Date: 17 December 2010/ID Number: G00209271 2010 Gartner, Inc. and/or its Affiliates. All Rights Reserved.
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Publication Date: 17 December 2010/ID Number: G00209271 2010 Gartner, Inc. and/or its Affiliates. All Rights Reserved.
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Other
Major clients: Over 60 in total, including VimpelCom (Russia), Optimus (Portugal), Mobinil (Egypt), Orascom (Algeria, Bangladesh, Egypt, Pakistan), Wind (for example, Greece, Italy), Brisa (Portugal), Oi (Brazil), Advanced Info Service (Thailand), Meteor Mobile Communications (Ireland), Orange Group (for example, France, U.K., Spain), Vodafone (for example, U.K., Australia, Hungary, Spain, Portugal), Telefnica (for example, Brazil) and O2 (Germany). Pricing strategy: WeDo's pricing software license model is based on the number of subscribers and product modules. The company also offers managed services in specific situations and it is preparing a SaaS for commercial launch in 2011 in a partnership model. Acquisitions since 2000 that support the RA and FM solution are as follows: Praesidium (2007). Cape Technologies (2007). Tecnolgica Telecomunicaes (2007).
RECOMMENDED READING
"Competitive Landscape: Convergent Charging and Billing" "Content Continues to Drive Deal Flow but Billing and Network Management Remain in Demand, 2010 Update" "Forecast: Telecom Operations Management Systems (BSS, OSS and SDP), Worldwide, 20062014, 4Q10 Update" "Global BSS, OSS, Enhanced and Enterprise Initiatives, 2009" "Hype Cycle for Communications Service Provider Operations, 2010" "Market Share Analysis: BSS, OSS and SDP Vendors Need Nimble Strategies to Sustain Future Growth, 2010 Update" "Market Share: Telecom Operations Management Systems (BSS, OSS and SDP), EMEA, 20072009" "Market Share: Telecom Operations Management Systems (BSS, OSS and SDP), Asia/Pacific and Japan, 2007-2009" "Market Share: Telecom Operations Management Systems (BSS, OSS and SDP), Americas, 2007-2009" "Market Share: Telecom Operations Management Systems (BSS, OSS and SDP), Worldwide, 2007-2009"
Publication Date: 17 December 2010/ID Number: G00209271 2010 Gartner, Inc. and/or its Affiliates. All Rights Reserved.
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REGIONAL HEADQUARTERS
Corporate Headquarters 56 Top Gallant Road Stamford, CT 06902-7700 U.S.A. +1 203 964 0096 European Headquarters Tamesis The Glanty Egham Surrey, TW20 9AW UNITED KINGDOM +44 1784 431611 Asia/Pacific Headquarters Gartner Australasia Pty. Ltd. Level 9, 141 Walker Street North Sydney New South Wales 2060 AUSTRALIA +61 2 9459 4600 Japan Headquarters Gartner Japan Ltd. Aobadai Hills, 6F 7-7, Aobadai, 4-chome Meguro-ku, Tokyo 153-0042 JAPAN +81 3 3481 3670 Latin America Headquarters Gartner do Brazil Av. das Naes Unidas, 12551 9 andarWorld Trade Center 04578-903So Paulo SP BRAZIL +55 11 3443 1509
Publication Date: 17 December 2010/ID Number: G00209271 2010 Gartner, Inc. and/or its Affiliates. All Rights Reserved.
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