February - 2010 issue > Cover Story

By Vimali Swamy

There is a bittersweet smile among most telecom operators around the world. At more than $1.5 trillion annual revenue, telecom is one of the largest and fastest growing industries in the world today. Emerging markets, in particular are witnessing an exponential growth in subscribers and are enjoying substantive top-line growth. Yet, the concerns over revenue leakage and fraud too, are increasing. Statistics show that operators lose approximately an average of five percent of their annual revenue, amounting to a whopping $75 billon in yearly revenue losses. The Yankee Group, a leading analyst firm that tracks telecom and related markets, estimates the market for revenue assurance solutions – that can help reduce this leakage – to be more than $900 million in annual spending per year.

Avi Basu, President and Chief Executive Officer of Connectiva Systems has a reason to be pleased as the looming concerns of revenue leakage in the telecom industry have opened up many opportunities for his New York based company. Founded in 2001, the company develops revenue management software that enables telecom operators reduce revenue leakage, minimize fraud, improve operational effectiveness, and increase over-all profitability. With its award winning multi-application analytics platform, Connectiva has helped save more than half a billion dollars in revenue for some of the leading telecom operators in the world. These include large telcos like Zain, Bharti, T-Mobile, Videotron, and Idea.

The Bee in the Bonnet

The typical revenue cycle of a telecommunications operator involves a complex and intricate set of systems that work with each other. A minimum of 15 different systems collaborate and process all the data related to the user from the moment a customer walks into a retail outlet for new activation to post-activation usage activities such as making calls, downloading content, using wireless applications to reviewing and paying the monthly bill.

Due to various types of disconnects between systems and inadequate process and data integration, ‘leakage’ may occur. Uncharged traffic, inconsistent rating, fraudulent activities, and erroneous billing are some of the several possible causes of leakage. Furthermore, errors in order management and provisioning systems allow subscribers use the services without being charged or generate inconsistent customer records that can create long-term customer satisfaction issues. An efficient revenue assurance program is therefore required to keep track of the entire revenue stream and ensure the integrity of the process.

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