Digital Insurance: How to protect your legacy

April 16, 2015 by Dave Labuda

The topic of Digital Transformation is hitting fever pitch this year and everywhere you turn there are studies, reports, recommendations and confirmations about how CSPs must embrace Digital. Monetize, capitalize, and delight your customers through online digital experiences that will enhance your brand and your revenue!

But despite all the sweeping proclamations, we all know that the telecoms industry does not cater to sweeping, fast-paced transformations. E-care, Omni-channel marketing, contextual offers – fantastic – but how does all this ‘out with the old – and in with the new’ really work? CSPs have invested hundreds of millions of dollars in existing IT infrastructure which cannot simply be ‘replaced’ or ‘transformed’ at the speed of light to keep up with the pace of digital consumer evolution. So how do CSPs ensure a successful digital future while preserving legacy service revenue and the systems that they’ve invested so heavily in - and are still dependent on - to run their business?

Business transformation requires investment in new technology and new capabilities to drive and support automation, operational process redesign and new business model development. But finding and leveraging new technologies that cater to digital enablement does not require an end-to-end IT transformation project. We are especially skeptical of these behemoth projects, which tend not to deliver any type of measurable results within a reasonable time frame, if at all.

Some CSPs are taking a different approach and looking at specific areas where the biggest improvements can be made around service delivery, simplification and effectiveness of customer interaction, and cost reduction of existing old world processes and systems such as order management and customer support. New capabilities can then be injected into the IT infrastructure where needed and in areas that will produce a quick and measurable ROI versus swapping out entire legacy ecosystems. From a Digital Transformation perspective, most CSPs are focusing on self-care, digital channel sales and support, rapid product development and real-time data management - and then looking for solutions to specifically cater to these areas rather than replacing their entire BSS infrastructure.

This more focused, surgical approach shifts the balance away from large, multi-year projects to shorter, sprint-like programs that deliver new capabilities every few months. Vendors who are building solutions for CSP digital enablement must change their monolithic approach and think about building solutions that serve as bridges between legacy and digital rather than wrecking balls.

A solution that ‘bridges’ the gap between old world and Digital lays the foundation for long term business change without massive disruption. These solutions come with an ‘insurance’ of sorts to protect existing assets while providing the future platform for Digital. They are designed to interwork; not to replace. This more componentized approach enables CSPs to leverage their existing systems for what they are good at while protecting them from things they weren’t designed to handle, all while maintaining their existing legacy services and revenue streams.

There are multiple examples of how this can be achieved with unified policy and charging. From a network perspective, deploying a modern real-time charging and policy solution not only provides new capabilities for monetization of data services, and customer personalization - but the charging engine can actually absorb much of the chaos that LTE traffic can cause to traditional signaling interfaces. Through proper quota management, the OCS can reduce signaling and authorization requests that are putting stress on network gateways and communication interfaces between existing OCS/PCRF and mediation systems.

A well designed charging engine can absorb the network traffic, and aggregate the myriad of charging event records into a more manageable number of coherent billable events. For example, aggregating hundreds of charging records produced by a YouTube session down to one billable record for the whole session. By reducing EDR loads and providing intuitive billing records, existing billing systems and data warehouses can continue to operate as they do now without being overwhelmed by the immense traffic growth and exceedingly detailed network information that LTE and connected devices are generating.

Real-time data aggregation also provides more intelligent information for downstream analytics applications to make contextual decisions about customer offers and actions and provides the mechanism by which to trigger promotions and offers individually at the right moment. This protects investments in existing analytics platforms as they can be passed a smaller, more relevant set of information rather than trying to process the enormous swell of raw data being generated as devices and usage continue to grow exponentially.

CSPs leveraging unified policy and charging technology also benefit from new product catalog and pricing capabilities so they can roll out advanced propositions such as app-based pricing, sponsored data, and dynamic sharing without having to replace traditional CRM and product catalog components, thus extending the life of these assets while breaking free of the constricted traditional CSP pricing models.

Finally, by inserting a real-time policy and charging engine into the existing BSS infrastructure, CSPs now have the means to serve digital self-care channels as well as reduce the burden on call centers. When customers have accurate, transparent information at their fingertips and simple ways to buy packages and choose options online, they no longer need to contact customer service and their needs are served more immediately. As digital offerings get more sophisticated and personalized and the average customer is managing more devices and options, the traditional customer care channel can be protected and even optimized instead of being overrun by increasing levels of customer interaction.

While there are different approaches to digital enablement and transformation, much of the journey depends on the starting point. While wiping the slate clean and bringing up an entirely new digital infrastructure sounds sexy and appealing, for most CSPs it’s just not possible. Vendors in the space should consider how the solutions they design can provide automation and agility while shielding legacy assets from the requirements of the digital economy so CSPs can continue to leverage systems where there is no business case for replacement.