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í˘Issues of billing for WAP
WAP is a very hot topic at the moment with plenty of news articles and commercial material talking about it. Recently, there have also been several announcements about trials and commercial launches from different operators and content providers. However, most of the announcements are missing something: billing-i.e. how to make money out of WAP?
The WAP Forum is the organization that is responsible for the WAP specification with currently over 200 member companies from different areas of the business, including equipment vendors ,network operators, service providers .Initially, most of the specification work on WAP concentrated on defining protocols between devices and the Internet.; the development at that stage was very much driven by the vendors. Once the operators and the providers started to join the WAP Forum the focus started to shift towards services.
However, there is a problem with the WAP specifications in that there are no definitions for service provisioning or for how to bill the services. Those two aspects are obviously critical for operators , as they require a means to provide WAP services in a simple way and get profit from the services. For this reason, operators led the move in the WAP Forum to set up a billing í░Expert Groupí▒ that would concentrate on billing related topics, with its main initial task being to gather different billing requirements relating to different business models.
Three questions : what, who and how
There are three big questions that are related to the business model of the operator or service provider
-What to bill?
This is the simplest question . There are only two different things that can be charged: airtime and content. Naturally the two components of charge can also be combined in some way. Airtime is very simple to measure from the network traffic, either by determining the duration of the data call( for circuit switched data) or by counting data packets(e.g. number of SMSs).Information(or content) is worth money and customers can be charged for accessing it.
It is worth noting that airtime is related to the business model of the network operator and content to that of the content provider: those two actors may, or may not be ,the same organisation.
-Who does the billing?
This is somewhat different compared with the traditional telecommunications model. Traditionally, all billing was done by the network operator, but now content and service provides might wish to do their own billing for the service they provide. This could mean several bills to the customer.
Use a billing agency is one possibility and indeed, some operators already outsource their billing function to specialised billing agencies. WAP is natural addition to the services that billing agencies handle: all information relating to the services used for a WAP session can be sent to the billing agency, which would send a consolidated bill to the customer. Alternatively, the network operator could act as the billing agency, billing the customer(with whom they already have a billing relationship) for the total transaction and then passing revenue to content and service providers.
Credit card companies are natural players when WAP service become generally available, especially with e-Commerce where the credit card companies could play a big role. Users could also pay with their credit card for normal (i.e. non e-Commerce) usage of WAP services.
How to do the billing?
How to charge is the most difficult decision to make when setting up WAP services. There are several possibilities:
-Transaction based billing
This is hardest way of doing billing. In this model, airtime and content price are combined, meaning that a charge has to be generated every time the user downloads information. The price of the service can vary because the content price may be different for each transaction. Finding the right balance of airtime and content is the key, otherwise the total price for the service could become too high, deterring users from using it. This type of billing is also flexible for future needs, particularly if the airtime components is relatively small, because users feel they are paying for the service, not for the connection. Using this model , a change in the underlying transport technology to GPRS will not change anything in the billing model.
The technical challenge is to get the billing systems or mediation devices to handle the details.
-Flat rate
Services can be billed at a flat rate, but with heavy competition this could lead to very low profit margins.
-Monthly fee
This is model that is also used in the Internet, with users paying a fixed monthly charge for a connection, which can then be used as much as they like. A subscription model suffers from the same drawback as the flat-rate model that there is pressure towards lowering the price, so reducing margins.
-Free services
Another possibility that is new to the mobile world is providing free services. In this scenario the content provider is willing to offer the service free to the users and perhaps even pay for their airtime. This is one way to attract users to new services available. However, if there is a mix of free and charged services available, perhaps from the same access number, there are added complications to the billing system.
Other complications that arise are the different charging models used in the Internet for mobile networks and the issue of roaming.
-Mobile vs. Internet charging
This is probably the most discussed issue in billing for WAP, the reason being that WAP brings together two worlds with traditionally very different charging approaches: the free Internet and the traditional mobile world where users pay (often heavily) for services. Mobile operators, like Sonera, would prefer to use the mobile model , whereas content developers generally come from the Internet domain and are used to the free model.
This issue will become more important as handsets and networks improve, allowing users to surf the whole Internet, not just the limited set of sites that is being provided initially.
Roaming is a very complex issue. In the ideal WAP world , users can use local services wherever they are and this is not a problem if billing is based only on airtime. If services themselves are also charged then there be a problem as then WAP services themselves need subject to a roaming agreement and added to the charging record format that is sent between operators. In the GSM world this means adding a new service type in the TAP(Transfer Account Procedure) format.
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