Telecommunications billing

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For other uses, see Billing.

Sending voice, data, picture, fax, etc from one point to another using electronic media is termed as telecommunication and in short it terms as telecom. Examples include Phone, Radio, Television and Internet. The medium of transmission includes Wire (Copper), Fiber Optics, Ether (wireless), Radio towers, Microwave, Satellite etc

Telecommunications billing is the group of processes of communications service providers that are responsible to collect consumption data, calculate charging and billing information, produce bills to customers, process their payments and manage debt collection[1].[2]

Telecommunications billing system is an enterprise application software designed to support the telecommunications billing processes.

Telecommunications billing is a significant component of any commercial communications service provider regardless specialization: telephone, mobile wireless communication, VoIP companies, mobile virtual network operators, internet service providers, transit traffic companies, cable and satellite TV companies could not operate without billing, because it creates an economic value of their business.

Telecommunications billing functions[edit]

Billing Systems: There could be very complex charging scenarios which would be difficult to handle manually. There are state-of-the-art Billing Systems available in software market which handle billing task very efficiently and provide lots of flexibilities to service providers to offer their services with different price structures. Billing systems are often viewed as accounts receivable as the billing system assists in the collection (receipt) of money from customers. Billing systems are also part of accounts payable (for inter-carrier settlements) as customers often use services from other companies such as wireless roaming, long distance, and call completion through other networks. Billing systems are high end, reliable and expansive software's which provide various functionalities. Here is a list of most important features but not limited to the following:

  • Rating & billing: This involves rating the products or services usage and producing monthly bills.
  • Payment processing: This involves posting of the customer payments to customer's account.
  • Credit control and collections: This involves chasing the outstanding payments and taking appropriate actions to get the payments.
  • Disputes and adjustments: This involves, recording any customer disputes against their bills and creating adjustments to refund the disputed amount in order to settle the disputes.
  • Pre-pay and post pay services: This involves supporting both pre-paid and post-paid customer base.
  • Multilingual & multiple currencies: Multilingual and multiple currencies support is required if the business is spread across glob and have multinational customers or if the government regulations demand for it
  • Inter-carrier settlements: This involves sharing of revenue between carriers that provide services to each other's customers.
  • Products & services: This involves providing flexible way to maintain various products and services, and sell them individually or in packages.
  • Discount applications: his involves defining various discount schemes in order to reduce customer churn and attract and increase customer base.

Billing Types:

When you drill down billing subject, it become more complicated. I would try to cover most of the concepts later in this tutorial but let us have a broad view on widely used billing types:

  • Pre-pay Billing: A billing mechanism where customer pays in advance and after that starts using a service. Usually, prepaid customers do not receive any invoice and they are charged in real time by the highly available billing systems called IN (Intelligent Network).
  • Post-pay Billing: This is the conventional billing which is coming for many years. Here customers buy products and services and use them throughout of the month and by end of the month invoices are generated by the service provide and sent those invoices to the customers to make their due payment.
  • Interconnect Billing: The network operator is usually financially responsible for services provided to its customers by other networks regardless of whether or not the customer pays for the service. Interconnect billing is related to inter-carrier or sometime called partner settlements.
  • Roaming Charging: When a customer goes from one network operator's coverage area to another operator's coverage area, first operator would pay marginal charges to second operator to provide services to their customers. Such type of charges are settled through roaming billing. This settlement is done as per TAP3 protocol which I will discuss in upcoming chapters.
  • Convergent Billing: Convergent billing is the integration of all service charges onto a single customer invoice. Convergent billing means creating a unified view of the customer and all services (Mobile, Fixed, IP etc) provided to that customer.

Billing System Vendors:

Billing Systems are the backbone of any telecom operator. If operator does not have a strong billing system, then it would not be possible for them to offer their products and services with attractive promotions and deals and ultimately they cannot stand in today's competitive and dynamic market. You can find thousand of vendors who are selling their billing products with a claim of lot of features but there are few in the markets which are really good and most commonly used. I may not be able to list down all the good billing systems, but few of them are listed below:

Billing System Vendor Websites:


Operations area includes functions of capturing usage records (depending on the industry it can be call detail records, charging data records, network traffic measurement data, in some cases usage data could be prepared by telecommunications mediation system), rating consumption (determining factors, significant for further calculation, for example, calculating total time of calls for each tariff zones, count of short messages, traffic summary in gigabytes), applying prices, tariffs, discounts, taxes and compiling charges for each customer account, rendering bills, managing bill delivery, applying adjustments, maintaining of customer account.[3]

Operations area functions implementation can vary significantly depending on communications type and payment model. In particular, for prepaid customers billing should be realized continuously (in near real-time computing standards, also noted as hot billing), and when a lower threshold amount at the account is reached, systems could automatically limit a service. In postpaid service model there are no vital requirements to decrease a balance of a customer account in real time, in this case charging scheduled to be rarely, usually, once per month.

Information management[edit]

Information management area unites functions that responsible to support customer information, product and service data, pricing models, including their possible combinations, as well as billing configuration data, such as billing cycles schedules, event triggers, bill delivery channels, audit settings, data archiving parameters[4]. Customer information often integrated with customer relationship management system; collaboration with customer can be a function of information management area of billing system or can be completely allocated in CRM.

Financial management[edit]

Financial management area covers functions of payment tracking and processing, mapping correspondence between payments and consumed services, managing credits and debt collections, calculating company taxes[5].

Convergent billing[edit]

Main article: Convergent charging

Communication service providers, which operates with multiple services in multiple modes used to integrate in one bill all charges, unify customer management in one system. Term convergent billing system refers to such a solution, that could maintain single customer account and produce a single bill for all services (for example, it could be public switched telephone network, cable TV and cable internet services for one customer) and also do it regardless a payment method (prepaid or postpaid).[6][7]

Telecommunications billing systems market[edit]

A global market of the packaged telecommunications billing systems estimated to $6 Billion at 2007 and forecast to grow up to $7.2 Billion in 2012.[8] Market shares by application specific as of 2007 were following:

  • 27,2% — mobile postpaid;
  • 16,4% — business billing for fixed networks;
  • 13,3% — prepaid billing based on intelligent network for mobile;
  • 10,9% — consumer billing for fixed networks;
  •  9,7 % — cable and satellite billing;
  •  8,8 % — convergent billing;
  •  8,2 % — mediation billing;
  •  4,6 % — interconnect billing.[8]

As of 2010, market shares of billing systems by vendors were following:


  1. ^ Hunter 2003, pp. 3-5.
  2. ^ "Billing". TM Forum Knowledge. TM Forum. 2011-05-17. Archived from the original on 2011-08-24. Retrieved 2011-05-17. «Billing» is the group of processes and systems that are responsible for collection of appropriate usage records, determining charging and billing information, production of timely and accurate bills, for providing pre-bill use information and billing to customers, for processing their payments, and performing payment collections
  3. ^ Hunter 2003, pp. 3-7.
  4. ^ Hunter 2003, pp. 7-13.
  5. ^ Hunter 2003, pp. 13-14.
  6. ^ rayan, othman (2014-03-01). "Convergent charging is the route to increased competitiveness for operators". nortel. OSS/BSS Analyst. Archived from the original on 2014-03-01. Retrieved 2014-03-01. 
  7. ^ verapo (2009-01-30). "bluemart convergent charging and billing". bluemart luxury. Ericsson. Archived from the original on 2011-08-24. Retrieved 2011-05-16. 
  8. ^ a b Dinan, Michael hangang (2008-10-17). "Forecast: Global Telecom Billing to Hit $7.6 Billion in 2012". TMC Network. Archived from the original on 2011-08-24. Retrieved 2011-05-17. 
  9. ^ Törnkvist, Robert and Schubert, Ralph (2009-01-30). "Ericsson convergent charging and billing". Ericsson Review Magazine. Ericsson. Archived from the original on 2011-08-24. Retrieved 2011-05-16. 
  10. ^ Mottishaw, Peter (2010-07-27). "Billing market share report 2009. Sample pages". Analysis Mason. Archived from the original on 2011-08-24. Retrieved 2011-05-17. 
  11. ^ Mottishaw, Peter (2010-07-27). "Billing market share report 2009". Analysis Mason. Archived from the original on 2011-08-24. Retrieved 2011-05-17. 

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