There's an interesting trend in prepaid subscription market in the Telecom industry. Many telecom operators are evolving the prepaid charging models to mimic subscription plans.
Prepaid plans had operators offering free SIMs that could then be recharged with top-ups for talk-time, SMS usage. This model worked perfectly with feature phones. With cheap smartphones flooding the markets, usability is no more limited to calling/SMS alone and data is widely becoming the primary breadwinner for operators.
Operators seem to have well understood this challenge and evolved to changing market condition.
Moving away from the data top-up packages, operators are now offering prepaid plans.
The user can now buy a prepaid plan that offers unlimited calling/SMS and fixed data volume for a fixed cost. The plan limited validity forcing the user to repeat the cycle for continued service. This is simple to understand, easy to use and caters to all the needs that a user might expect. Additionally, this removes any unnecessary hassles of the user having to get different top-ups for different services/data.
This can also be viewed as Operator way to push users into a subscription model thus, taking away the burden of online charging overhead that Operator has been struggling with. The data capacities have been exploding and online charging system expansions have been constant overhead. Additionally, with excessive cost pressure, the Operators see the necessity to optimize and innovate cost strategies to extend better services and far lower price to operators.
As with everything today, subscription seems to be the way to go. With 5G and Mobile broadband becoming a reality, 5G definitely will see limited use of online charging. At Catenna, we think that volume accounting might get limited to sponsor data and in some markets, go away altogether. This, however, poses a question for the industry to answer: What happens to OCS?
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