At a time when cable operators are also part Internet provider and part phone company, finding transaction systems that fill the bill is becoming increasingly complex.
While some are still sticking to separate systems for each service, others are delving into unified systems that offer bundled billing and greater marketing coordination.
That's the trend billing provider Convergys Corp. is seeing these days as it shops around its converged "Integrated Communications Operations Management System" (ICOMS). The former Cincinnati Bell subsidiary does business with seven of the top 10 MSOs.
"Each has their own strategy on how they are putting together an OSS [operations support system] that can support these next generation or emerging services," said Curt Champion, senior director for Convergys's cable and broadband market. "Some have decided to do a wholesale changeout to a convergent offering like ICOMS. Others have decided to bring in new billers for the new offerings, so not a single biller. And others are working with their current billers to try to extend to their cable offerings to support other types of products and services."
On the one hand, some customers are working with a mix of billing systems. AT&T Broadband recently installed the ICOMS billing system to handle its cable telephony offerings, but due to a legal settlement reached in late 2000, the MSO is also committed to use products from CSG Systems Inc., which handles the company's video and data billing, until 2012.
AT&T also has a merger pending with another Convergys client: Comcast Corp.
Comcast uses DST Innovis Inc. — formerly CableData Inc. — and Convergys as its primary billing vendors. Comcast will be upgrading its Convergys systems to the new ICOMs platform, and given the continuing relationship, Champion thinks the company is in a good position.
"We see that as a very optimistic sign," he said. "Comcast is a customer of ours — we have a long history with them and a very good relationship, and we look forward to working with the new AT&T-Comcast not only on telephony billing but also customer care and fully convergent billing."
Other MSOs opt for a single provider and a unified billing platform. But creating a billing system for multiple services wasn't as easy as just extending the cable billing system into data and telephony. Most cable billing systems were built to handle relatively simplistic, static monthly charges, while the new services must handle variable customer transactions, Champion said.
"That's the main reason we actually built and delivered a new convergent billing and customer care product instead of trying to adapt a cable product," he said. "There is only one customer record, there is only one account, and there is only one rating scheme. So it can look at everything as a whole to determine the appropriate discounts and packaging and such."
Cox Communications Inc. is the only MSO that uses ICOMS as its sole billing platform, and it is sold on the system in part because of the unified billing and flexibility it offers.
"We quickly move any acquisition to that platform," said Joe Rooney, vice president of marketing at Cox. "It makes sense, it works for us and it is a great competitive advantage. The legacy billing issues that some of our competitors have gives them a lot of challenges in terms of dealing with us where it counts — with the consumer."
One advantage to using one system is the ability to offer a single customer bill. Cox has for some time offered combined data and cable service billing, and last year it added telephony to the bill.
"We're certainly seeing the benefit in terms of making it easier for our field marketers to market and sign up new customers into our bundle of services," Rooney said.
It also may have helped improve the churn rate. While 1.7 percent of customers who only took video left Cox in the first three quarters of 2001, Cox lost only 0.7 percent of customers who took voice, video and data.
"Bottom line is anywhere from 33 to a 50 percent churn reduction when a customer buys a bundle of services, and we believe that billing simplicity is a big part of that," Rooney said. "Our research shows that 60 to 70 percent of customers say they want a single bill, and it's one of the most important reasons in selecting a provider."
The smarter way to stay on top of the multichannel video marketplace. Sign up below.
Thank you for signing up to Multichannel News. You will receive a verification email shortly.
There was a problem. Please refresh the page and try again.