Carrier’s IT infrastructure unprepared for 3G

Traditional IT ideals of building a system to meet current requirements was a fundamental cause of recently failed Australian carrier One.Tel Ltd.’s billing system blunders and threatens to stymie other carriers in their move to new generation systems.

“There have been rumors that One.Tel’s billing system was largely at fault for its demise,” said David Hislop, vice-president, consulting service for ADC, a supplier of billing systems to carriers. “They were proud of their integrated billing system and the fact that they built it themselves. However, building your own billing system usually means that you create a system that meets known requirements.”

“But the classic thing is that when the system is built, you end up with conflicting requirements for the system.”

Hislop said having a billing system that is not flexible enough extends into the operating phase of the business cycle to the point that you can not introduce new services and bill customers quickly enough, thereby not having enough cash flow to maintain your business model.

Geoff Johnson, research area director, enterprise network strategies for Gartner Asia Pacific, agrees that everything revolves around the billing system and that One.Tel’s system did not handle the growth of the company.

With the advent of data package-based services, such as GPRS (general packet radio service), EDGE (enhanced data GSM environment) and 3G (third-generation wireless), Hislop said many carriers are in danger of following One.Tel’s path to destruction due to an “unawareness” within the industry of the huge differences between GSM and next generation billing systems.

Hislop said the move to data packet-based communications means billing systems would have to become revenue management systems.

“The billing systems need to be very flexible as service providers will need to keep track of their service offerings from different partners – and be able to know real-time the value of services, and be able to tell customers real-time the value of each service.”

The unpredictability of the way traditional billing systems will cope with the range of 3G-like service – to be available shortly – will mean most service providers will initially offer relatively simple and low-value services, Hislop said. He believes there will be a reticence among carriers to provide high-revenue services, such as wireless access, to corporate networks until billing systems prove themselves capable.