Competitive Landscape Revenu 209271

Research

Publication Date: 17 December 2010 ID Number: G00209271

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Competitive Landscape: Revenue Assurance and Fraud Management for Communications Service Providers

Norbert J. Scholz

Revenue assurance (RA) and fraud management (FM) help communications service providers (CSPs) reduce inefficiencies in their front and back offices. Both have in common that they try to fix revenue loss, be it either deliberate (FM) or unintentional (RA).

Until recently, most CSPs had separate organizations that handled RA and FM. FM entered mature mainstream many years ago, and every CSP now has an FM system. It has to address new challenges such as being more real-time, being more proactive, increasing automation, detecting new fraud patterns and handling new data sources. RA only gained prominence as a separate discipline in the mid-2000s. It has since entered early mainstream with its own industry associations, maturity models, blogs, printed books and independent academic research.

CSPs have begun combining FM and RA using the same tools as a foundation. Vendors have followed suit by adding new features to their solutions: the FM vendors adding RA and the RA vendors adding FM modules.

Key Findings

Fraud management and revenue assurance are merging. Both depend on pattern recognition and use the same tools as a foundation, such as business intelligence (BI) and extraction, transformation and loading (ETL). Both use common dashboards to combine this information.

FM and RA represent services-heavy business processes and productized software solutions at the same time. Suppliers address this dilemma by providing either a flexible platform or a solution with a dedicated road map, but hardly ever can they provide both simultaneously.

The growth potential for traditional FM and RA solutions is limited as the market is maturing. RA suppliers will morph into business performance management providers, embracing adjacent solutions such as customer experience management (CEM), churn management, data mining, margin management, risk management, and so on.

Suppliers that look to expand beyond the CSP vertical will counter challenges from existing business performance management suppliers.

Publication Date: 17 December 2010/ID Number: G00209271 of 43

© 2010 Gartner, Inc. and/or its Affiliates. All Rights Reserved.

Recommendations

CSPs should explore how they can use their existing RA and FM tools for related disciplines such as BI or risk management.

CSP should choose a supplier that can grow with them in terms of platform flexibility and professional services.

Suppliers must decide if they are a platform or a solutions provider. Being a platform provider improves flexibility but could limit opportunities with CSPs looking for specific solutions. Being a solutions provider improves opportunities with CSPs looking for specific solutions but limits the vendor's ability to address related solutions and make quick changes to the product if required.

Suppliers should develop a strategy to face competition from vendors that specialize in BI, analytics, performance management and related solutions. This could include selectively targeting other industry verticals (such as media and entertainment, finance, utilities, and so on), or merging with other RA and FM vendors to enlarge the scale of their operations.



TABLE OF CONTENTS

Analysis ....................................................................................................................................... 6 Competitive Situation and Trends .................................................................................... 6

RA and FM — Process vs. Solution ..................................................................... 6 Market Players ................................................................................................................. 7 The Future of Competition ............................................................................................... 9

The Competitive Landscape in Three to Five Years ........................................... 10 Other Vendors Not Included in This Document .................................................. 10 Provider Strategies Impact Market Forecast ...................................................... 11

Competitive Profiles ....................................................................................................... 11 Connectiva Systems .......................................................................................... 11

Market Overview and Revenue ............................................................. 11 General Product/Service Marketing Strategy ......................................... 11

Strategy ................................................................................... 11 Vision ....................................................................................... 12

How This Provider Competes ................................................................ 12 Competitive Differentiators ....................................................... 12 Solution Components ............................................................... 12 Solution Architecture ................................................................ 13

Other .................................................................................................... 15 cVidya Networks ............................................................................................... 15


Strategy ................................................................................... 16 Vision ....................................................................................... 16


Other .................................................................................................... 18 HP .................................................................................................................... 19


Strategy ................................................................................... 19 Vision ....................................................................................... 19


Other .................................................................................................... 22 Martin Dawes Analytics (MDA) .......................................................................... 23


Strategy ................................................................................... 23 Vision ....................................................................................... 24


Other .................................................................................................... 28 Neural Technologies ......................................................................................... 28




Strategy ................................................................................... 28 Vision ....................................................................................... 29


Other .................................................................................................... 32 Subex ............................................................................................................... 32


Strategy ................................................................................... 32 Vision ....................................................................................... 33


Other .................................................................................................... 35 Teoco ................................................................................................................ 36


Strategy ................................................................................... 36 Vision ....................................................................................... 37


Other .................................................................................................... 38 WeDo Technologies .......................................................................................... 39


Strategy ................................................................................... 39 Vision ....................................................................................... 39


Other .................................................................................................... 42 References and Methodology ........................................................................................ 42

Recommended Reading ............................................................................................................. 42

LIST OF TABLES

Table 1. Overview of RA and FM Vendors .................................................................................... 8

Table 2. Delivery Options by RA and FM Vendors ........................................................................ 8



LIST OF FIGURES

Figure 1. Connectiva's Revenue Assurance and Fraud Management Solution Architecture......... 14

Figure 2. cVidya's Revenue Assurance and Fraud Management Solution Architecture................ 18

Figure 3. HP's Revenue Assurance and Fraud Management Solution Architecture ..................... 22

Figure 4. MDA's Revenue Assurance and Fraud Management Solution Architecture .................. 27

Figure 5. Neural Technologies' Revenue Assurance and Fraud Management Solution Architecture ................................................................................................................................ 31

Figure 6. Subex's Revenue Assurance and Fraud Management Solution Architecture ................ 35

Figure 7. Teoco's Revenue Assurance and Fraud Management Solution Architecture ................ 38

Figure 8. WeDo's Revenue Assurance and Fraud Management Solution Architecture ................ 41



ANALYSIS

Competitive Situation and Trends

Communication service providers (CSPs) have taken a fresh look at ways to reduce inefficiencies in their front and back offices because of economic pressures and new business models. New technologies and solutions promise to reduce revenue leakage and fraud. In reality, most CSPs continue to operate with a smorgasbord of internal and external business support system (BSS), operations support system (OSS), CRM and enterprise solutions that open the doors to revenue loss and fraudulent use. The urgency to manage inefficiencies becomes clear if one adds to that an (a) ever-expanding array of third-party IT and content services, and (b) the reluctance of many CSPs to convert their entire front and back office stacks to the latest and most efficient technologies.

Revenue assurance (RA) and fraud management (FM) solutions address these issues. Both have in common that they try to fix deliberate (FM) or unintentional (RA) revenue loss. Both share the same data sources and require a similar infrastructure for business process orchestration, case and alarm management, and key performance indicator (KPI) management.

Until recently, most CSPs had separate organizations that handled RA and FM.

FM entered mature mainstream many years ago, and every CSP now has an FM system. It has to address new challenges such as being more real-time and proactive, increasing automation, detecting new fraud patterns, and handling new data sources.

RA only gained prominence as a separate discipline in the mid-2000s. It provides data quality and process improvement methods that improve profits, revenue and cash flows without influencing demand. RA has since entered early mainstream with its own industry associations (for example the Global Revenue Assurance Professional Association [GRAPA], and the TM Forum's Revenue Management Initiative), maturity models, blogs, printed books and independent academic research (see "Hype Cycle for Communications Service Provider Operations, 2010").

CSPs have begun combining FM and RA using the same tools as a foundation. Vendors have followed suit by adding new features to their solutions: the FM vendors adding RA and the RA vendors adding FM modules. Both camps depend on pattern recognition and use the same tools as a foundation, such as BI and ETL. Both use common dashboards to combine this information.

RA and FM — Process vs. Solution

From a competitor perspective, the challenge is that FM and RA take the shape of both services-heavy business processes and productized software solutions.

Business Processes — As processes, FM and RA cut across multiple horizontal and vertical layers of CSPs' back and front offices. RA is one of the five major "assurance" processes as defined below. It often blends into these assurance processes as it draws on data owned by these processes.

Revenue Assurance — Data quality and process improvement methods that improve profits, revenue and cash flows without influencing demand.

Customer Assurance — Monitors customer experience. Performance data or alarms must be meaningful to specific customer groups or individuals. Processes include



order entry, order management, churn management, quality of service management, and so on.

Business Assurance — Optimizes business outcomes. Processes include cash management, financial analysis, margin management, and so on.

Service Assurance/Quality Assurance — Provides CSPs with insights into individual services inside the service transport layer, and how these services are performing. Processes include service problem management, service configuration and activation, and so on.

Network Assurance — Ensures proper operation of the network. Processes include resource provisioning, resource data management, and so on.

Productized Solutions — Productized solutions that tend to be most closely associated with RA include: customer experience management, dealer commissions management, trade and settlement, partner settlement, risk management, compliance management, and others.

For vendors, this dual nature of RA and FM has the following implications:

There is always a high degree of consulting work involved, even if the solutions claim to be out-of-the-box.

No single vendor can productize all the possible solutions required by CSPs because of evolving requirements and the limited bandwidth of most suppliers.

Vendors are left with two options:

1. Add new modules as required by their customers.

Advantage: Repeatability; makes marketing and sales efforts more impactful.

Disadvantage: It requires high R&D investment and a dedicated road map.

2. Develop a platform that CSPs can easily customize according to their own requirements.

Advantage: Wider reach within CSP organizations.

Disadvantage: Hard to market to CSPs looking for specific solutions.

Market Players

Suppliers featured in this report were selected based on their 2009 revenue from software license sales in the category "revenue assurance and fraud management" (see "Market Share: Telecom Operations Management Systems (BSS, OSS and SDP), Worldwide, 2007-2009"). Suppliers had to have a global customer base and solution with a dedicated product road map. The rationale was to focus on software-based solutions and exclude providers of customized solutions and professional services. Table 1 provides a summary of the players covered in this study; Table 2 shows their delivery options.

Functionality — All suppliers provide basic functionality such as business intelligence, business rules, data integration, enterprise application integration (EAI), interconnect auditing and network auditing. In addition, all suppliers under consideration have a range of consulting services alongside their software solutions. For details, see the individual profiles.



Delivery Options — There is some variation in the delivery options and pricing schemes offered as shown in Table 2. Standard licensing is most common, but cloud/software as a service (SaaS) and managed services are more or less standard now, although the accounting units vary. Managed services and contingency-based pricing are less widespread.

Table 1. Overview of RA and FM Vendors

Vendor Name Solution Names Number of

Customers URL

Connectiva Systems Affirm

Sentry

CEM

40+ www.connectivasystems.com

cVidya Networks Integrated Revenue Intelligence

Solutions (IRIS) 140+ www.cvidya.com

HP CentralView Fraud Risk Management

CentralView Revenue Leakage

Control

CentralView Roaming Fraud

Control

CentralView Subscription Fraud

Prevention

CentralView Dealer Performance

Audit

100+ www.hp.com/go/centralview

Martin Dawes Analytics (MDA)

Lavastorm Analytic Platform 38 www.mda-data.com

Neural Technologies (NT) Minotaur

MinotaurCloud

MinotaurInsight

45 www.neuralt.com

Subex ROC Revenue Assurance

ROC Fraud Management

180+ www.subexworld.com

Teoco Sonar

Bill TrakPro and View Logic

47 www.teoco.com

WeDo Technologies Business Assurance RAID 60+ www.wedotechnologies.com

FM = fraud management; RA = revenue assurance

Source: Gartner (December 2010)

Table 2. Delivery Options by RA and FM Vendors

Connectiva cVidya HP MDA NT Subex Teoco WeDo

Software License X X X X X X X

# of Modules X X X X

# of Subscribers X X X X X X X

# of Transactions X X X X X

# of Users X X

http://www.connectivasystems.com/

http://www.cvidya.com/

http://www.hp.com/go/centralview

http://www.mda-data.com/

http://www.neuralt.com/

http://www.subexworld.com/

http://www.teoco.com/

http://www.wedotechnologies.com/



Connectiva cVidya HP MDA NT Subex Teoco WeDo

# of CPUs X

# of Controls X

# of xDRs X X X

Software Rental X X X

Hosted/SaaS/Service

Bureau

X X X X X X X*

Initial Set-Up Fee X X

# of Modules X

# of Subs X

# of Users X

Processing Volume X X X

Monthly Fee X X X X X

Annual Fee X X

Managed Services X X X X X X X

Performance-Based

Revenue Sharing X X X X X

* Planned for 2011

FM = fraud management; RA = revenue assurance; SaaS = software as a service; xDR = x detail record

Source: Gartner (December 2010)

The Future of Competition

In 2006, we made three predictions about the future direction of the competitive situation in RA ("Revenue Assurance Revisited: Tools That Contain Leakage"). From a technical perspective, most of the predictions have materialized. From a competitive and market perspective, RA has become more inclusive than previously anticipated, projecting its reach further into adjacent solutions.

1. Prediction 1: The market will bifurcate — Some RA solutions will be absorbed into

traditional BSSs and OSSs, while other will survive as stand-alone solutions.

Results: Prediction 1 came to fruition only in part. RA today is a separate market but it is moving in a different direction than the one envisioned in 2006. RA has not become part of BSSs and OSSs. Rather, it is moving toward BI, analytics and ETL.

2. Prediction 2: Content will drive RA — RA will experience a boost as content services

enter the mainstream. The potential for revenue leakage increases because of the greater complexity of the content value chain.

Results: Prediction 2 turned out to be correct, although at a slower pace than anticipated.

3. Prediction 3: Solutions will become more inclusive — Those RA solutions that survive will provide more-comprehensive functionality. In addition to switch-to-bill reconciliation, interconnect/network auditing, business rules and data integrity management, RA solutions will increasingly include business intelligence, fraud management and network management.



Results: Prediction 3 turned out to be correct, although the network management element is still lagging.

The key theme for assessing the future of competition is that CSPs can use common FM and RA tools, namely BI, ETL tools and common dashboards for a number of purposes outside traditional FM and RA departments. It is possible that RA and FM will assume much broader responsibilities, potentially expanding into strategy and finance functions, that can be loosely classified as "business performance management."

The Competitive Landscape in Three to Five Years

RA and FM are will reach, or will have already reached, maturity and the market size is relatively small. This means that the overall growth potential for suppliers is limited. Globally, we predict only a 4.5% compound annual growth rate (CAGR) from 2010 to 2014 on external spending for these solutions. Spending on software licenses is predicted to grow from $117 million in 2010 to $139 million in 2014, and on services from $496 million to $591 million. Outsourced and cloud solutions will grow from $48 million to $60 million (for details, see "Forecast: Telecom Operations Management Systems (BSS, OSS and SDP), Worldwide, 2006-2014, 4Q10 Update").

Suppliers will have to look for other ways to drive profitable growth. New strategies will shape the competitive landscape as follows in three to five years:

Expansion into "business performance management" — Almost all the suppliers surveyed stated that RA will expand into adjacent areas such as CEM, churn management, data mining, margin management, risk management, and so on. RA and FM vendors are likely to butt heads with established suppliers of business performance management, business process management, business intelligence, analytics, and so on.

Expansion into other industry verticals — Some vendors are actively looking to apply their solutions in other industries. Media and entertainment is the most logical step as companies from this vertical integrate with traditional telecom operations or provide their own offerings. Other industries that have a large subscriber base are also on the radar of "traditional" RA suppliers, including finance, utilities, retail, and so on. RA vendors are likely to face competition from suppliers that specialize in these verticals. On the demand side, they will also have to grapple with "not invented here syndrome" by prospects.

The tug-of-war between solution and platform providers is likely to continue — No single vendor can deliver all the solutions that CSPs require, and platform vendors tend to have a hard time convincing prospects that their platform can be used for specific solutions.

The market is likely to consolidate further — Cross-industry business performance management and BI vendors are likely to become interested in CSP expertise and the client base of RA vendors and acquire some of the CSP-focused vendors. RA and FM vendors might look for acquisitions to enlarge the scale of their operations and better face competitors with a cross-industry focus.

Other Vendors Not Included in This Document

Vendors not included in this document were below the revenue cut-off point for software license sales in 2009, or else did not have a global client base. The following is a sample list of these vendors:



Advanced Technologies & Services (ATS), www.atso.com (RA)

Allround, www.allround.net (RA and FM)

Araxxe, www.araxxe.com (RA)

Basset, www.bassetglobal.com (RA and FM)

Beck Computer Systems, www.beckcomputers.com (FM)

Capana, www.capana.com (RA)

Cartesian (a TMNG Global company), www.cartesian.com (RA)

Comware, www.comware.com.tw (FM)

Equinox Information Systems, www.equinoxis.com (RA and FM)

Honovi Solutions, www.honovi.com (RA)

Teleonto, www.teleonto.com (RA)

Xintec, www.xintec.com (RA and FM)

Provider Strategies Impact Market Forecast

Demand for RA and FM is likely to continue because of the need to update systems that handle new data sources, new fraud patterns, real-time analytics and platform optimization.

Expansion into adjacent areas and industry verticals could boost the market forecast, but some of the additional revenue would come from other forecasts. This would entail a redefinition of RA to encompass not only CSPs but other verticals as well.

Competitive Profiles

Connectiva Systems

Market Overview and Revenue

Connectiva Systems' RA and FM portfolio includes the following products: Connectiva Affirm (RA), Connectiva Sentry (FM) and Connectiva CEM (customer experience management).

In 2009, Connectiva's revenue from revenue assurance and fraud management amounted to over $30 million, according to Gartner estimates. The Middle East and Africa region was its largest market with $15 million, followed by Asia/Pacific with $6 million, Western Europe with $6 million and North America with $3 million.

General Product/Service Marketing Strategy

Strategy

Connectiva sells direct to customers. It has a sales force in North America, Latin America, Europe, the Middle East, Africa, India and Asia/Pacific. The company also leverages key service integration partners as reseller channels where appropriate and depending on customer preference.

http://www.atso.com/

http://www.allround.net/

http://www.araxxe.com/

http://www.bassetglobal.com/

http://www.beckcomputers.com/

http://www.capana.com/

http://www.cartesian.com/

http://www.comware.com.tw/

http://www.equinoxis.com/

http://www.honovi.com/

http://www.teleonto.com/

http://www.xintec.com/



In addition to software licenses and hosted solutions, Connectiva provides business consulting, technology, implementation and managed services.

Key partners include:

Technology partners: Oracle, IBM, HP, i2 and Tekno Telecom.

SI and channel partners: Ericsson, IBM, Tech Mahindra, T-Systems, Protiviti, ITC, HCL, Alcatel-Lucent, TCS, Wipro and Nokia Siemens Networks.

Vision

Connectiva's vision for RA and FM includes the following elements:

RA is morphing from reactive leakage identification to a more holistic revenue optimization function that can proactively identify disconnects, prevent opportunity losses and bridge the gap between customer satisfaction and RA functions.

RA and FM will converge on the IT side under a common owner, especially in emerging markets.

Customer experience analytics will merge with RA as both domains leverage similar sets of data and analytic services in identifying revenue and customer experience disconnects

Connectiva aims to become a leading provider of subscriber data monetization solutions that can find hidden insights and translate them to five key business outcomes: (1) reduce leakage, (2) minimize fraud, (3) proactively reduce churn, (4) Increase subscriber average revenue per unit (ARPU) and (5) increase channel ARPU.

How This Provider Competes

Competitive Differentiators

Integrated Revenue Optimization Suite: Natively integrated FM, RA and CEM solutions all built on the same schema and analytic application framework.

Performance and Scalability: The platform has been proven to process over 10 billion event detail records (EDRs) a day and manages over 150 million subscribers in a single instance.

Proactive RA: Integrated test call generation, xDR simulation, rating and billing assurance capabilities to deliver proactive RA.

Customer-Centric Revenue Management: Delivers customer-centric RA and FM by focusing on the subscriber life cycle vs. the traditional emphasis on system disconnects.

Identifying the "unknown unknowns": Manage both mature and immature areas of RA and FM by providing a comprehensive suite of analytic services that can manage the "known knowns," "known unknowns" and the "unknown unknowns."

Solution Components

Business Intelligence — Connectiva's BI capabilities are built on an open standards-based next-generation analytics platform. They include:

High-performance ETL server and real-time event manager that can process tens of billions of events a day.



Telecom-specific data model with prepackaged RA and FM story boards.

Interactive data visualization tools that enable business users to interact with data at both summary and detailed levels in real time.

Business Rules — A common rule engine with a user-friendly interface that can be deployed across RA and FM applications and in both batch and real-time modes.

Data Integration — Built on a "Configure and Not Code" philosophy, all Connectiva applications (including RA, FM and CEM) are built on a common schema and metadata layer and leverage a common set of analytic services and business process infrastructure. The solution can integrate to both unstructured and structured data sources and offers native ETL capabilities optimized for a telecom environment.

EAI — All analytics engines are exposed as Web services and can respond to calling third-party applications. They are also built on a virtual data model abstraction and can consume information from both third-party data sources and applications.

Interconnect Auditing — The solution is designed to analyze both revenue and cost

elements of interconnect events and calculate margins for every customer event by correlating data across retail and wholesale.

Network Auditing — The solution delivers end-to-end audit and assurance across all network elements in varied telecom environments, ranging from wireline, prepaid and postpaid mobile to cable quad-play and satellite. Assurance is comprehensive and includes audits across all network-recorded activity, configurations and errors.

Others — Smart Discovery Engine: The solution can auto-detect anomalies, patterns and outliers, and raise alerts and insights. Based on a patented Darwinian statistical model, this capability allows for investigating the unknown unknowns and constantly finding new sources of leakage, fraud and customer experience disconnects. Connectiva also offers fingerprinting and profiling services that enable proactive detection and identification of fraud and leakage.

Solution Architecture

Figure 1 shows the architecture of Connectiva's RA and FM solution.



Figure 1. Connectiva's Revenue Assurance and Fraud Management Solution Architecture

ETL = extraction, transformation and loading

Source: Connectiva Systems



Other

Major clients: Over 40 in total. Examples include Wataniya (Kuwait), Bharti Africa, STC

(Bahrain), Idea Cellular (India), YTL (Malaysia), Videotron (Canada), Bharat Sanchar Nigam (India), Tunisiana (Tunisia), Bharti (India), T-Mobile (USA), T-Mobile International (Europe), Telefónica (Spain) and Bell Canada (Canada).

Pricing strategy: Connectiva offers four pricing models:

Enterprise application license with per-subscriber license fees.

Enterprise application license with per xDR license fees.

Subscription usage model over fixed term with per-month standard pricing (based on subscribers and/or xDRs); includes a license buy-out option at the end of the term.

SaaS (on-site or hosted) where Connectiva owns the infrastructure, performs the implementation and offers the entire solution stack as a service. The pricing is on a monthly basis and is blended across hardware, database, operating system, application software, implementation and deployment support.

Additional models offered:

Outcome-based pricing models that charge for the solution based on outcomes delivered, such as leakage found, fraud identified, specific increase in ARPU because of campaigns delivered, and so on.

Managed service options that enable providers to outsource their operational revenue management functions to Connectiva.

Acquisitions since 2000 that support the RA and FM solution are as follows:

Olista (2010):

The solution's capabilities include smart discovery engine, social network analysis, action engine and funnel analytics.

All elements of Olista's technology have been integrated into RA and FM applications.

The assimilation of Olista capabilities into Connectiva's core platform provides CSPs with an integrated subscriber data monetization platform that can help optimize revenue holistically across multiple domains (revenue assurance, cost management, fraud, retention and upsell/cross-sell).

cVidya Networks


cVidya's RA and FM portfolio includes the following product: Integrated Revenue Intelligence Solutions (IRIS).

In 2009, cVidya's revenue from RA and FM amounted to nearly $28 million, according to Gartner estimates. Western Europe was its largest market with $13 million, followed by Latin America with $6 million, and North America, Western Europe, Eastern Europe and Asia/Pacific with around $3 million each.



Following the acquisition of ECtel in early 2010, and after adding FM and margin analytics products to the portfolio, the combined revenue for 2010 is estimated at $60 million, with the following regional breakdown: Western Europe $17 million, Latin America $11 million, North America $12 million, Eastern Europe $9 million, Asia/Pacific $4 million and Africa $7 million.


Strategy

cVidya targets the leading telecom, media and entertainment service providers. For the upper tiers, the company's go-to-market strategy is based on conducting proof-of-concepts and a direct sale engagement by cVidya and SI partners. For the midrange and small tiers, cVidya is offering a cVidya-Cloud, using a SaaS model, with an optional managed services offering.

cVidya offers the full gamut of consulting services, starting with risk and maturity assessments, thorough project rollout. The company has a "kick start" consulting package for CSPs that are looking to build an internal business plan for RA and FM.


Technology partners: IBM, Oracle, SAP and Informatica.

SI partners: IBM, Huawei, Atos Origin and Ericsson.

Channel partners: Amdocs and Deloitte.

Vision

cVidya's vision for RA and FM includes the following elements:

The convergence trend of RA and FM will continue. cVidya's road map consists of sharing a common infrastructure and functional elements between these two products.

BI and data mining technologies, as well as new data sources such as social networks, will become integral parts of RA and FM.

RA and FM will become a significant part of every business process in the organization, allowing customers to be more proactive.



Complete revenue intelligence solution across all types of networks, line of business and operator size.

Large number of deployments (over 140) allows it to leverage best practices, methodologies and fast deployment of three months, on average.

Scalable product (handles 10 billion call detail records [CDRs] per day in a single project), with rapid configurability.

Solution Components

Business Intelligence — Margin Analytics and Best Plan Advisor are using BI

technologies, which can help provide the right price plan to the customers, while ensuring the required profitability and margin.



Business Rules — Advanced graphical user interface (GUI) where end users can define business rules and/or apply roles form a large library of predefined roles.

Data Integration — Utilizing ETL capabilities, including OEM capabilities from vendors like Informatica, to provide an ETL and data integration layer.

EAI — Using advanced EAI tools, including a set of predefined APIs, enables fast integration of all the data sources needed to support the revenue intelligence functionality.

Interconnect Auditing — Portfolio includes a dedicated solution for interconnect auditing, as well as a settlement- and portal-based dispute mechanism to reconcile with external telecom vendors, content partners, and more.

Network Auditing — MoneyMap switch-to-bill reconciliation helps indentify faults and errors on the network level, and generates the relevant trouble ticket to the network team.

Others:

Unified Revenue Assurance and Fraud Management — The integrated solution shares common infrastructure elements such as data acquisition, case management, reporting, and so on.

Dealers commission management; margin/pricing analytics; and EZTrust, which is a set of cost assurance tools that assists the invoice reconciliation process between carriers and includes a dispute settlement mechanism.


Figure 2 shows the architecture of cVidya's RA and FM solution.



Figure 2. cVidya's Revenue Assurance and Fraud Management Solution Architecture

IRIS = Integrated Revenue Intelligence Solutions; ETL = extraction, transformation and loading; RHEL = Red Hat

Enterprise Linux; JDBC = Java Database Connectivity; OLE DB = Object Linking and Embedding Database; OLAP = online analytical processing; MS SSAS = Microsoft SQL Server Analysis Services

Source: cVidya

Other

Major clients: Over 140, including AT&T (U.S.), BT (U.K.), Telefónica Group, O2, Vodafone, MTN (South Africa), Orange and Bell Canada.

Pricing strategy: cVidya's pricing strategy is as follows:



A setup fee is charged for the IRIS infrastructure, and a license fee for each application based on the number of subscribers or transactions. Consulting, professional services, maintenance and support are charged in addition.

A cloud/SaaS model with a managed services option, in which the customers pay an initial setup fee, and a monthly fee for a certain period of time based on the number of users or processing volume.


ECtel (2009):

ECtel previously acquired Compwise (2008), Elron Telesoft (2005) and Telrad's Hawk NET-I product (2001).

HP


HP's RA and FM portfolio currently includes the following products: CentralView Fraud Risk Management and CentralView Revenue Leakage Control, CentralView Roaming Fraud Control, CentralView Subscription Fraud Prevention, and CentralView Dealer Performance Audit.

In 2009, HP's revenue from RA and FM amounted to around $40 million, according to Gartner estimates. Western and Eastern Europe were its largest markets with around $27 million together, followed by the Americas with around $9 million and Japan with around $1 million.


Strategy

HP's RA and FM solutions are part of a larger revenue intelligence portfolio aimed at protecting CSPs' revenues, while supporting their goals to reduce capital and operating expenses.

HP offers a full range of consulting and integration services for RA and FM, including regular "health checks," a collaborative service, typically performed on-site over three to five days, to review and tune the existing FM system and revenue leakage control systems, organization and performance. HP also offers a broad range of consultancy services mainly focused on the business management, which may help in optimization of processes and risk assessment.


OEM partners: SAP/Business Objects, IBM/SPSS and Oracle.

Other partners: Microsoft and i2.

Vision

HP's vision for RA and FM includes the following elements:

Convergence between RA, FM, credit control, audit security and network operations will increase, as will convergence between lines of business, such as prepaid/postpaid, and quad-play providers.

ROI considerations will drive CSPs' investments in RA and FM:

Emphasis on BI to detect more subtle cases of fraud and leakage, mainly coming from content and mobile payments.



FM will be coupled with policy control and deep packet inspection (DPI) probes.

Risk documentation and demonstration will become increasingly important.

Decreased total cost of ownership (TCO) will drive CSP investments in RA and FM:

Cost reductions and the need for a holistic view of security will drive a consolidation of CSP departments. The IT department will manage risk and revenue assurance applications jointly, but the control will be assigned to different teams belonging to the same risk management department. Increased adoption of Internet Protocol (IP) networks will create synergies with security and operations, when flat-rate plans are phased out and customers begin to be charged by tiers.

Tools will be increasingly integrated, sharing the same platform and supporting multiple concurrent products for information sharing across applications and economies of scale. Scalable Linux on Blades system will dominate the scene.

SaaS support for RA and FM will be more affordable for customers with limited budgets.



Product continuity — Mostly internally developed tools as opposed to competitors that acquired multiple assets.

Leverage best in class partners for non-core competencies (presentation and data mining).

Locally-based expertise backed by global resources and comprehensive consultancy services.

True platform sharing to reduce operational costs across applications.

The collection layer is based on embedded components from HP's own mediation product.

Open architecture and scalability.

BI and workflow capabilities are integrated across all solutions, easing investigation, analysis, resolution and productivity.

A user community that embraces best practices sharing and actively contributes to the portfolio's road map.

Solution Components

Business Intelligence — All CentralView applications are delivered with a dedicated BI database containing data models specifically designed to support the business analysis of the application (fraud, dealer, credit, churn, subscription, roaming fraud, and so on). The data models share common data to avoid redundancies. Each application comes with a prebuilt ETL component to automatically fill the data models and compute high-level aggregations. No, or minimal, integration work is required. Data is presented via prebuilt reports and dashboards based on SAP/Business Objects XI, which is embedded via an OEM agreement. Reports and dashboards are specific to the business area of



each product, while extensions are supported. Most of the CentralView applications come with a scoring engine based on IBM/SPSS Modeler.

Business Rules — A set of parallelized processes provide maximum flexibility to configure and implement in a timely manner the business rules required for the task.

Data Integration — Applications are supported by a data collection and cleaning layer based on an embedded mediation product. The layer provides a robust user interface to add new data streams and monitor the runtime performances of the collection layer. A configurable rating engine allows users to enrich un-rated network events with charging information.

EAI — Northbound EAI via Common Object Request Broker Architecture (CORBA) and Web services to other back-office systems (credit checks, provisioning, and so on) and southbound integration via network protocols like Diameter (for example, DPI integration).

Interconnect Auditing — Interconnect Invoices Verification gives CSPs a complete workflow, covering the entire validation process end to end, including management of disputes. This applies to traditional voice interconnection and any kind of partnership, including contents and merchants (e-commerce or m-commerce).

Network Auditing — Policy is supported by the HP Subscriber, Network and Application Policy (SNAP) portfolio. CentralView will expand into network auditing using the same platform, with the goal of detecting and blocking in real-time suspicious activities using DPI probes. The acquisitions of Fortify and Arcsight will be leveraged to provide timely alarms to the FM application.

Others — CentralView replaces traditional service/traffic monitoring through a revenue-generation, or cost-generation, chains monitoring schema based on entities/events. This allows the use of the framework in many distinct manners such as network auditing, billing auditing, roaming and interconnect auditing, partnership controlling, credit management such as monitoring of a non-telco assets, retail chains, dealers networks, usage of credit cards, and so on.

KPI engine and online analytical processing (OLAP) cubes — KPI engine provides maximum flexibility to configure and implement KPIs defined on data sources (OLAP cubes or summary relational tables), to provide control points and alarms for abnormal situations.

Case management — Investigation and analysis tools support case management and incident management workflow and help review supporting data, resolve cases and take counteractions.

Audit and security — Audit and security features of the solution have been implemented according to European Union regulations and guidelines for confidential data retention.


Figure 3 shows the architecture of HP's RA and FM solution.



Figure 3. HP's Revenue Assurance and Fraud Management Solution Architecture

BO = Business Objects; MSQL = Microsoft SQL; OLAP = online analytical processing; IIS = Internet Information Services; DB = database; KPI = key performance indicator; ETL = extraction, transformation and loading; BODS = BusinessObjects

Data Services; GUI = graphical user interface

Source: HP

Other

Major clients: Over 100 in total, including Bouygues Telecom (France), Vodacom (South Africa) and Vodafone (Netherlands).

Pricing strategy: HP CentralView applications offers four pricing models:

Per-subscriber license model, where the cost of the license is proportional to the number of customers protected. The license cost is divided into tiers, and has a decreasing cost per tier in line with the increase in the number of subscribers.



Per-transaction license model, where the cost of the license is proportional to the volume of transactions monitored. The license cost is divided into tiers, and has a decreasing cost per tier in line with the increase in the number of transactions.

Pay per usage, where the customer pays a license rental fee proportional to usage during a period of time.

SaaS, where the customer pays only a fee, for hardware, software, services and support.

Acquisitions since 2000 that support the RA and FM solutions are as follows:

The applications have been originally developed in Digital Equipment Corporation/Compaq, subsequently acquired by HP (2001). HP performed all development in-house.

Martin Dawes Analytics (MDA)


MDA provides both RA and FM solutions, often delivered through a single converged platform. MDA's AdaptiveRA and AdaptiveFMS solutions are underpinned by the Lavastorm Analytic Platform, composed of the Lavastorm Analytic Engine (LAE), Lavastorm Transaction Warehouse (LTW), Lavastorm Data Reader (LDR) and Lavastorm Resolution Center (LRC). AdaptiveRA includes billing, usage, delivery and revenue management components; AdaptiveFMS includes identity fraud, usage fraud and payment fraud components.

In 2009, AdaptiveRA and AdaptiveFMS revenues combines were around $13.5 million, according to Gartner estimates. Revenues spread equally over these geographies: North America, Western Europe, the Middle East and Africa, and Asia/Pacific.


Strategy

MDA's AdaptiveRA and AdaptiveFMS strategies center on giving customers the greatest analytic rigor and flexibility to detect and address revenue and fraud risk, and delivering that value through a new-generation case management and reporting engine. The rigor and flexibility enable customers to maximize results today, and adapt to new and changing revenue streams, such as mobile content, and evolving fraud risk, and extend value beyond revenue to include delivery, dealer commission and customer analytics. Beyond communications and media, MDA addresses the utility market to provide RA, compliance and customer analytic capabilities.

MDA goes to market through direct and indirect channels. It has salespeople and partners in North America, EMEA and Asia/Pacific. The company uses a three-pronged go-to-market strategy:

MDA's Lavastorm Desktop (LD) product provides a low capital beachhead, which lets clients progress to the server-based platform. In some cases, MDA has established a LD pilot program to provide free trials so that companies can gain early results without capital outlay and use results to fund an ongoing program. In support of this approach, MDA has established a Lavastorm Forum (both public and private forums) with a blog, to enable and promote sharing and peering among users.

MDA encourages prospects and customers to execute proof-of-concepts (POCs), particularly in new areas where the customer benefits from understanding technical



feasibility can develop indicative results to frame the business case, and can get a sense on how to structure the program post-POC. Most MDA POCs can be accomplished in about three days.

MDA works with its partners to provide the tools and systems to create partner- and customer-defined solutions. These solutions are, today, deployed in the communications, media, utility, financial services and transportation industries.

MDA offers a set of professional services including design, coaching and training, peering, and implementation services. MDA also provides managed services.


Technology partners: MicroStrategy, Oracle, Red Hat, Netezza and SAS.

Solution partners: PwC, Ernst & Young and PRTM.

SI partners: Accenture, IBM, Capgemini, Ericsson, Synaptitude and Cognizant.

Vision

MDA's vision for revenue assurance and fraud management includes the following elements:

Continue to advance the discovery, analytics, control and case management capabilities of AdaptiveRA and AdaptiveFMS to improve detection and resolution of errors and threats, and maximize the financial value of the solutions.

To support demand for more collaborative process discovery and analytic capabilities, especially in new areas of interest where process behavior and the nature and extent of risk are less known, MDA is investing in visualization and collaboration capabilities to enhance process discovery, modeling, pattern recognition and process analytics.

RA and FM will move more toward real-time with a greater level of automated resolution. This is to respond to more organized, sophisticated fraudsters and to address risk as it occurs, and before it affects customers or revenue performance. MDA is investing in performance enhancements, including in-memory processing, as well as a new case management capability to enable customers to maximize financial productivity, and increase the extent to which resolution is automated.

Enterprises will require greater flexibility and expect that systems can be rapidly changed, added to, and tuned to address changing threats, risks and priorities. MDA is expanding both its technology platform and solutions to enable customers to rapidly, and if desired autonomously, adapt to changing risks and priorities.

Enterprises will require greater data and analytic leverage from RA and FM to provide an analytic environment that addresses different business needs (customer experience, service delivery, process optimization, and so on) and deliver a superior business case. To achieve leverage, MDA is investing in analytic IP, to include reader formats, analytic nodes, and RA and FM controls to help providers accelerate and maximize financial value.

RA and FM systems will continue to scale to meet growing CDR levels; for example, MDA processes more than 1.5 billion records a day for customers, and it expects to see a fivefold increase in CDR volumes over the next five years. MDA is investing in order to scale all products to keep up with growing volumes, yet maintain the analytic rigor needed to identify data and logic issues that impact revenue and detect fraud.





Adaptive modeling that simplifies and strengthens the analytic development approach and includes visualization, prebuilt and configurable analytic IP, process discovery, intelligence, methodology, and data acquisition and federation.

Open system approach for RA, FM and the other solutions that give providers a virtually unlimited ability to design, adapt, tune and extend the technology to changing risks and priorities.

Analytic rigor that includes deep inspection in terms of process discovery, analytics and controls that maximizes accuracy, hit rate and overall productivity.

Solution Components

Business Intelligence — MDA interprets the BI layer as business analytics, reporting and dashboarding, and case and alarm management. MDA provides multiple statistical, financial, and trending/pattern and other business nodes both tied directly to the related controls and generally for any analytic.

Business Rules — MDA provides two level of business rules analysis: process discovery, which allows providers to discover the actual data and logic at the atomic level where this data was previously unknown, opaque or assumed to be correct (non-defective in terms of integrity and in compliance with the designed rules); and process analysis, which deconstructs logic to the lowest possible level (a customer, a rate, an order, a CSR transaction, and so on) to enable providers to identify the atomic-level issues that aggregate to process risk.

Data Integration — MDA's platform includes a full ETL and data integration layer. The capability includes the LDR, which is a metadata management reader that MDA ships with prepackaged ASN.1 and COBOL Copybooks nodes. The LDR simplifies and streamlines the acquisition of highly complex, nested structures that are common in switch and mainframe environments. The LDR is integrated into the LAE, which provides the "TL" functionality with the LDR, and the ETL functionality on its own through a set of prepackaged acquisition, transformation, profiling and other nodes (120 in all). These provide ETL and data quality, profiling, correlation, deep-inspection, statistical analytics and other higher-order analytics to ensure all data is loaded, homogenized, correlated, profiled and fully prepared for downstream analytics.

EAI — MDA provides correlation among systems and applications such that the process analytic can take advantage of all relevant data, independent of data source and data format. In this regard, MDA is not providing integration but rather creates a federated analytic foundation that includes the data and the business rules that exist within an application (or function) and among applications (or functions).

Interconnect Auditing — MDA provides interconnect billing and interconnect analytics, included in the trade and settlement solutions. MDA provides interconnect analytics for wholesale, consumer-to-consumer and content. MDA also provides trade and settlement as it relates to utility (wholesale/retail) and energy trading (intra-day risk reporting). For telecom and media, MDA has expanded this solution to provide trade balance analytics (delivered into a BI environment), where it provides near-real-time views of margin performance of different products and partners so that the provider is net-positive across the portfolio.



Network Auditing — Provided as part of usage analytics, migration assurance and asset management. It reconciles physical and logical assets, identifies stranded or under-utilized assets, or identifies assets that may be causing issues. These efforts are tied to both post-merger, post consolidation, modernization and ongoing operations efforts.

Others — In addition to RA and FM, MDA focuses on the following solutions: customer experience management, dealer commission management, service delivery performance, migration assurance, trade and settlement, and risk and compliance.


Figure 4 shows the architecture of MDA's RA and FM solution.



Figure 4. MDA's Revenue Assurance and Fraud Management Solution Architecture

G/L = general ledger; SME = small or midsize enterprise

Source: MDA



Other

Major clients: 38 in total, including AT&T (U.S.), BT (U.K.), Comcast (U.S.), Cox (U.S.), KPN

(Netherlands), M1 (Singapore), Mobistar (Belgium), MTN (Nigeria), MTS Allstream (Canada), Play (Poland), RCN Metro, Telia (Denmark), TeliaSonera (Sweden), Telstra (Australia), Telus (Canada), Verizon Wireless (U.S.), Vodafone (Greece, Ghana), Windstream Communications (U.S.), Yes Optus (Australia), Yoigo (Spain) and Ziggo (Netherlands).

Pricing strategy: MDA's pricing strategy is as follows:

The platform bid price is an amalgamation of the different composing products and services.

The LD is priced on a per-user basis, putting no functional limitations on them.

The LAE is priced on a per-CPU basis, as this presents the best platform opportunity to apply the analytic to any data and process issue.

The LTW (which is most typically deployed in the context of the platform), is priced in terms of usage volumes, data sources (readers) and number of controls applied.

The LDR based on the base capability, plus format types as add-ons.

The LRC is priced on a per-user basis.

Additionally, MDA offers a managed services model that is priced in terms of set-up and ongoing management.


Visual Wireless (2006).

Visual Wireless had previously acquired Avesta (2000).

Lavastorm (2005).

Neural Technologies


Neural Technologies' RA and FM portfolio includes the following products: Minotaur, MinotaurCloud and MinotaurInsight.

In 2009, Neural Technologies' revenue from RA and FM amounted to nearly $15 million, according to Gartner estimates. North America was its largest market with $6 million, followed by the Middle East and Africa with $3 million, and Latin America, Western Europe, Eastern Europe and Asia/Pacific with around $2 million each.


Strategy

Neural Technologies has a global focus. The company's sales efforts are divided into three regions: the Americas, EMEA and Asia/Pacific.

Neural Technologies predominantly sells through a direct sales force, but does enlist partners in some circumstances.



Neural Technologies offers a range of consulting services including analytical modeling, fraud management consulting, revenue assurance consulting, configuration services and outsourced services.


Technology partners: DigitalRoute, Oracle and Microsoft.

SI and channel partners: Dimension Data, T-Systems, Sopra, Ellipz, Concillium, TCS and Alcatel-Lucent.

Others: TCL — Global (testing), TRMG — Global (consultancy) and APS (intelligence).

Vision

Neural Technologies' vision for RA and FM includes the following elements:

RA will evolve into business intelligence/analytics to provide revenue protection and enhancement. This will allow CSPs to understand their customers, network, channels, and so on in a multidimensional view of potential revenue maximization, revenue loss detection, financial exposure and risk, allowing for a real-time proactive approach (not reactive) to understanding their business at any time.

From an architectural point of view, transaction analysis and BI will be tightly integrated.

Co-operative data collection will allow more effective management of data volumes introduced by LTE and DPI.

Credit management and cost management will become an integral part of RA.



NT deploys solutions into CSPs with mature processes and sophisticated requirements, and in situations where CSPs experience limitations with other systems.

The company's analytical model building tools are 100% proprietary.

The system comes with full functionality to allow the end user to take full control of configuration and not be constricted by vendor change requests.

NT provides transparent licensing. Product upgrades are included in support and maintenance fees, to ensure no hidden costs and to avoid unexpected surprises.

Solution Components

Business Intelligence — In addition to rules, Minotaur uses (a) a behavioral model based on a proprietary neural network architecture to identify random variations that are unique to each subscriber or entity on a network; (b) neural predictive analytical modeling to detect an applicant's propensity to fraud or credit risk; (c) link analysis to uncover relationships between new subscriptions, fraudsters, suspects and active accounts. Link analysis uses exact and fuzzy matching techniques to present information and raise alarms based on suspicious matches; (d) Adaptive thresholds; (e) special lists that allow a list of related items, such as account address, to be entered into the system; and (e) data mining.



Business Rules — In Minotaur, rules are designed to detect certain events that present a risk. If one of these events occurs then an alarm is raised. The rules are generated using Boolean statements; for example, if there's high consumption of calls but minimal payment activity, then raise an alarm.

Data Integration — This forms part of the mediation and data preprocessing stage, using data from external sources, primarily event EDR streams and customer data streams. NT provides a mediation platform, the Conversion Interface Manager (CIM).

EAI — Via the CIM as described above.

Interconnect Auditing — Minotaur can reconcile interconnect traffic with partner invoices to identify discrepancies with the help of the Minotaur reconciliation component (MRC). Further reconciliation can be performed during the settlement process with detailed CDRs and partner CDRs.

Network Auditing — Not relevant to NT.

Others — CSPs can use NT's analytical models to improve operations, including

marketing (by identifying only the relevant people to receive a specific offer or product), cross-sell and upsell (by exploring linkages between the products and services customers presently buy and the ones they might be persuaded to buy), customer retention (by offering special products, discounts, increasing credit limits, advising different products and plans), identifying customer lifetime value, and expediting the collections process.


Figure 5 shows the architecture of Neural Technologies' RA and FM solution.



Figure 5. Neural Technologies' Revenue Assurance and Fraud Management Solution Architecture

CIM = conversion interface manager; CSV = comma-separated values; ASCII = American Standard Code for Information Interchange; BER = basic encoding rules; (S)FTP =

(secure) file transfer protocol; DB = database; IP = Internet Protocol; SNMP = Simple Network Management Protocol; GTP = GPRS Tunnelling Protocol; CDR = call detail record

Source: Neural Technologies



Other

Major clients: 45 in total, including Kingston Communications (U.K.), O2 (U.K.), Orange

(Switzerland, Poland, U.K.), Telstra (U.K.), SFR (France), TDC (Denmark), Turkcell (Turkey), VimpelCom (Russia), GCI Communication (U.S.), DirecTV (U.S.), GE Money (U.S.), Sprint (U.S.), T-Mobile USA, Axtel (Mexico), Oi (Brazil), Digi (Malaysia), Digitel (Philippines), HDFC Bank (India), M1 (Singapore), Maxis (Malaysia), Telecom New Zealand, Meditel (Morocco), MTN (South Africa), Sunrise, (Switzerland) Telkom SA (South Africa) and Zain (Bahrain, Iraq, Kuwait).

Pricing strategy: Neural Technologies typically prices license implementations based on either subscriber numbers or data throughput, with additional costs for deployment activities and ongoing annual maintenance. The company also offers other pricing models, such as performance-based revenue share, rental options and monthly/annual service fees for hosted environments.


FICO, previously Fair Isaac (LiquidCredit for Telecom, 2009).

Fair Isaac had previously acquired HNC Software (2002).

HNC had previously acquired Systems/Link (2000) and Bedford Associates' ATAC product line (1998).

Prime Creation Technology (PCT) Hong Kong (2009).

Cerebrus Solutions (2004).

Subex


Subex's RA and FM portfolio includes the following products: ROC Revenue Assurance and ROC Fraud Management.

In 2009, Subex's revenue from RA and FM amounted to nearly $41 million, according to Gartner estimates. EMEA and the Americas were its largest markets with over $16 million each, followed by Asia/Pacific with $8 million.


Strategy

The main element in Subex's go-to-market strategy is the Revenue Operations Center (ROC), which is a centralized approach that brings together disparate assurance, audit and governance functions. The other key element in its go-to-market strategy is its delivery model. Apart from conventional license-based and service bureau models, Subex focuses on managed services. Finally, Subex aims at increasing its footprint among smaller CSPs through a Web-based SaaS offering, called ROCcloud. This is offered as a subscription for a fixed monthly fee.


Technology partners: i2, Dataupia, DigitalRoute, Juniper, IBM, Oracle, Pitney Bowes, Polystar, Revector, Nokia Siemens Networks, GE, BroadSoft, ConceptWave and Qliktech.



SI and channel partners: Accenture, IBM, Alcatel-Lucent, Nokia Siemens Networks, Infosys, Wipro, Tech Mahindra and BT Global Services.

Regional partners: Gantek, Comverse, TCS, Ericsson, ITS, Soin International and TIS.

Vision

Subex's vision for RA and FM includes the following elements:

RA and FM will become subsets of ROC, which most CSPs will build to manage the end-to-end revenue and risks associated with revenue.

Revenue operations applications will move to the cloud as CSPs want the benefits from ease of deployment, lower costs, the flexibility in the ability to assess ROI, and discontinue use if perceived value falls.



Helps CSPs build an ROC through ROCware, Subex's business response platform, which gives them an end-to-end operational and financial visibility into their business.

ROC Revenue Assurance provides ease of use, brings the right information to right people, increases productivity, lowers TCO, and can be implemented and configured quickly.

ROC Fraud Management enables proactive profiling, easy and flexible configuration, reduced revenue leakage and increased customer satisfaction, a bird eye's view of a variety of frauds, accurate monitoring and protection, increased workflow efficiency and productivity, and real-time detection.

Solution Components

Business Intelligence — Derived from the data the solutions receive and the tools and techniques available in the solutions themselves. These tools and techniques include: standard and configurable reporting, data correlation and trending, scenario analysis, forecasting, what-if analysis, and on-demand slice-and-dice capability.

Business Rules:

ROC Revenue Assurance provides GUI-based business rules configuration for data processing and data analysis. It supports enrichment, data transformation and normalization during data collection. It provides different types of business rules called "measures" that can be used for creating regular audits on the RA control points.

ROC Fraud Management also offers GUI-based rule configuration. The solution allows the user to create "rule templates" that broadly define the group of entities being monitored and the specific identifier being monitored, such as Mobile Subscriber ISDN (MSISDN), International Mobile Subscriber Identity (IMSI), Cell Site ID and Visited Public Mobile Network (VPMN), but do not provide any threshold information.

Data Integration — Data acquisition and integration for ROC Revenue Assurance and ROC Fraud Management is provided by Diamond, Subex's ETL tool. It collects data from multiple data sources, translating it into the required output formats. Diamond can



process and load ASCII, ASN.1, XML, binary and comma-separated values (CSV) formats. It also support data integrity validations on various fields and file structure.

EAI — With the help of APIs, the ROC Revenue Assurance and ROC Fraud Management solutions can be integrated with EAI solutions to leverage organizational knowledge inside the existing IT infrastructure of telecom operators.

Interconnect Auditing — ROC Revenue Assurance ensures accurate accounting of inbound and outbound interconnect traffic. ROC Fraud Management provides capabilities to tackle SIMBox abuse, re-filing, international revenue share fraud (IRSF) and other bypass-related frauds through its "Bypass Fraud Module." Discrepancies within interconnect partners against agreements, unsupervised changes within the routing tables, and unauthorized modification to interconnect rating can be identified through volume-based monitoring and monitoring of system audit log files. The Internal Affairs module can identify scenarios where privileges are abused by network personnel.

Network Auditing — ROC Revenue Assurance can process usage and subscription data from network elements to detect revenue leakage. Usage data from switch and Signaling System 7 (SS7) probes can be reconciled to identify suppressed usage, missing usage data in the switch due to misconfiguration or outage. Subscriber and service reconciliation between the home location register (HLR) and intelligent network (IN)/billing system can detect fraudulent service activation in the network.


Figure 6 shows the architecture of Subex's RA and FM solution.



Figure 6. Subex's Revenue Assurance and Fraud Management Solution Architecture

MSC = mobile switching center; ETL = extraction, transformation and loading; GGSN = Gateway GPRS Support Node; IN = intelligent network; NRTRDE = Near Real-Time Roaming Data Exchange; TAP = Transferred Account Procedure; ROC

= Revenue Operations Center; GPRS = general packet radio service; IP = Internet Protocol; DICE = Dynamic Intuitive Cube Engine

Source: Subex

Other

Major clients: Over 180 in total, including Aircel (India), AT&T (U.S.), du (UAE), Bell Canada, BT Global Services (U.K.), Claro (Brazil, Dominican Republic, Puerto Rico), Embarq (U.S.), France Telecom, Level 3 (U.S.), PLDT (Philippines), Rogers (Canada), STC (Saudi Arabia), Swisscomm (Switzerland), Telecom Egypt, Telkom Indonesia and Vodafone (India, Ireland, Italy, New Zealand, Romania, Turkey).

Pricing strategy: Subex's pricing strategy is as follows:

License models based on:



Number of records or transactions processed.

Number of users.

Number of subscribers.

Value-based pricing models, such as a risk-reward share model.

Hosted/service bureau models.

SaaS/cloud-based models.

End-to-end managed services.


Azure Solutions (2006):

Azure had previously acquired Anite Calculus (2004), Connexn Technologies (previously known as The Hutton Company) (2004) and Monnet (2004):

Connexn had previously acquired Telecomms Consultancy & Solutions (2003).

Anite had previously acquired Calculus Solutions (2000), Delta Partners (2001) and Syzygy Solutions (2000).

Mantas (2006):

Mantas had previously acquired SOTAS (2003):

SOTAS had previously acquired S3net (2000).

Magardi (2001).

Teoco


Tecoc's RA and FM portfolio includes the following products: Sonar, BillTrak Pro and ViewLogic.

In 2010, the combined revenue from RA and FM of Teoco and the recently acquired TTI Telecom is expected to amount to around $80 million, according to Gartner estimates. North America was its largest market with around $60 million, followed by EMEA with around $15 million, and all other geographies with $5 million. These numbers include the TTI Telecom acquisition.


Strategy

Teoco targets Tier 1 and Tier 2 providers in North America and EMEA.

Teoco consults clients through the design and implementation process and provides ongoing support after the product has been implemented. Together with its SaaS solutions, the company also provides "one time audits," to get a better understanding of the CSP's current state, and to work with clients to implement and establish a set of best practices.

Teoco's main technology partners for its solutions are Netezza, Oracle and Business Objects.



Vision

Teoco's vision for RA and FM includes the following elements:

RA and FM will converge, with both capabilities moving onto a common platform, with the ability to incorporate and report on new technologies and record formats. With the ability to correlate costs, RA has evolved into margin management.

More real-time visibility from the network and deeper analytics on both voice and data will provide a more comprehensive and end-to-end view.



Teoco's solutions use a combination of online transaction processing (OLTP) and data warehouse appliances to handle large volumes of records. It preserves raw records and adds enrichments to them at the CDR/EDR level, which provides access to highly granular, detailed data. Users can report at any level of summary or detail they need to perform their analysis.

Teoco engages with its client to solve business issues from a top-down view rather than selling shrink-wrapped solutions into the IT department.

The company has a long history of engagement with North American Tier 1 CSPs in the area of RA, FM, invoice processing and cost management.

Solution Components

Business Intelligence — Teoco solutions utilize Business Objects and iDashboards for BI reporting.

Business Rules — Teoco provides a library of business rules that are then tailored for each customer's business needs.

Data Integration — Teoco's solutions are able to load any record format. Teoco typically handles the conversion process rather than requiring clients to fit their information into predefined file templates.

EAI — Teoco captures invoice information in any format from BillTrak Pro or ViewLogic. The solutions have adaptors for almost every switch type and interfaces to all major mediation platforms, accounts payable and billing systems.

Interconnect Auditing — Sonar incorporates interconnect billing information from Teoco's BillTrak Pro and ViewLogic systems and aligns usage from the invoice to support interconnect auditing.

Network Auditing — Teococ's solutions are used to reconcile network costs as well as optimize interconnect relationships.

Others — Sonar accepts revenue information from the billing system (metered and non-metered usage), correlates it with costing data, and provides gross margin information for business analytics. This data is also used by many functional areas such as: finance, cost management, marketing and network operations.




Figure 7 shows the architecture of Teoco's RA and FM solution.

Figure 7. Teoco's Revenue Assurance and Fraud Management Solution Architecture

IP = Internet Protocol; TG = trunk group; MOU = minutes of use; MB = megabyte; MSC = mobile switching center; EDR = event detail record

Source: Teoco

Other

Major clients: Qwest (U.S.) and Sprint (U.S.).

Pricing strategy: Teoco's solutions are offered as a fully-hosted SaaS solution or as a managed service. It can be hosted exclusively at one of Teoco's data centers, or on the CSP's site, usually



with Teoco hardware. The pricing model is a monthly recurring fee based on size and number of modules.


TTI Telecom (2010).

Vero Systems (2008):

Vero had previously acquired certain assets from ADC's Services Fulfillment Division.

Vibrant Solutions (previously known as InformationView Solutions) (2006):

Vibrant had previously acquired Longitude Systems (2001), Network Audit Control (2001) and TeleCon (2000).

WeDo Technologies


WeDo Technologies' RA and FM portfolio includes the following product: Business Assurance RAID 6.0.

By the end of 2010, WeDo Technologies' revenue from RA and FM will amount to $56 million, according to Gartner estimates. Western Europe will be the largest market with $23 million, followed by Latin America with $19.5 million, the Middle East and Africa and Eastern Europe with $5 million, Asia/Pacific with $4.5 million and Central and Eastern Europe with $4 million.


Strategy

WeDo targets CSPs that have in-house developed tools and those that still don't have RA or FM tools implemented. In addition, the company targets the retail, utilities and finance industries with its Business Assurance solutions.

WeDo provides all requisite consulting and implementation services. It also has an independent consulting division, named Praesidium, that it acquired in 2007. Praesidium specializes in fraud management, credit management, revenue and cost assurance, IT and network security, and business continuity.

In the past few years, WeDo had its products delivered by leading consultancy and system integration providers.

Vision

WeDo's vision for RA and FM includes the following elements:

RA and FM will expand into adjacent areas, such as operations assurance, enterprise risk management, customer experience, customer retention, and so on.

The increased integration of IT and engineering within the CSP and the new over-the-top providers will create increased assurance and fraud problems in the next few years.





Global presence with offices in 15 countries in five continents and customers in more than 70 countries.

Industry scope in telecom (mobile, fixed, cable and triple-play operators) and experience in other industries like retail, energy and finance.

Professional and consulting services delivered by the Praesidium business unit.

Solution Components

Business Intelligence — Web portal: includes dashboard, reporting, data browsing, case management, KPI management and access control.

Business Rules — RAID has a built-in drag and drop process designer to configure the rules used to detect leakage.

Data Integration — Built-in data collection readers (network, mediation, rating, billing, roaming, interconnect, prepaid, and so on).

EAI — Data collection readers (network, mediation, rating, billing, roaming, interconnect, prepaid, and so on).

Interconnect Auditing — RAID lets you set up the controls over the interconnect revenue and cost streams by defining the measure points and the applicable validation rules (comparison between different points, historic analysis, threshold validations, and so on).

Network Auditing — Built-in data collection readers (network, mediation, rating, billing, roaming, interconnect, prepaid, and so on).

Others — Platform integrity, business control, incentives assurance, collections assurance, invoice control and prepaid balance validation.


Figure 8 shows the architecture of WeDo's RA and FM solution.



Figure 8. WeDo's Revenue Assurance and Fraud Management Solution Architecture

KPI = key performance indicator; RA = revenue assurance

Source: WeDo Technologies



Other

Major clients: Over 60 in total, including VimpelCom (Russia), Optimus (Portugal), Mobinil

(Egypt), Orascom (Algeria, Bangladesh, Egypt, Pakistan), Wind (for example, Greece, Italy), Brisa (Portugal), Oi (Brazil), Advanced Info Service (Thailand), Meteor Mobile Communications (Ireland), Orange Group (for example, France, U.K., Spain), Vodafone (for example, U.K., Australia, Hungary, Spain, Portugal), Telefónica (for example, Brazil) and O2 (Germany).

Pricing strategy: WeDo's pricing software license model is based on the number of subscribers and product modules. The company also offers managed services in specific situations and it is preparing a SaaS for commercial launch in 2011 in a partnership model.


Praesidium (2007).

Cape Technologies (2007).

Tecnológica Telecomunicações (2007).

References and Methodology

The research for this document is based on vendors' responses to questionnaires, interviews and Gartner's market statistics.

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