Communications Service Providers (CSPs) have long been wanting to move past being a dumb pipe into a customer’s home. They’ve taken a hit from VoIP and mobile providers, who have cut into their voice revenues; over the top (OTT) players, who are trying to wrestle away their video and television revenue, and alternative internet providers, who have cut in on their broadband revenues.
Many are looking for new ways to generate new revenue, and finally overcome the dumb pipe mantra that has been bestowed upon them.
M2M communications—and more specifically smart metering—could help them bridge the gap. Smart metering, which allows utilities to remotely monitor electricity or gas usage and conditions at a residence or business in real time, has recently cleared significant territorial, regulatory and privacy hurdles to gain significant traction in regions such as the United States, Western Europe and China. CSPs already own the relationship with the customer, so it on paper at least make sense that they partner with utilities to take on the back-end support for smart metering and become the single-source vendor for residential services.
The scenario isn’t unprecedented: NTT DoCoMo latched onto an opportunity to move beyond offering telecom services and become the financial platform of choice for bill payment and outsourcing. The same—in theory—can be done for utilities, with CSPs offering billing as a service capabilities. In the past, utilities used to manage the entire supply chain, from power generation to distribution to selling to billing. Now they likely outsource the billing portion.
However, smart metering is going to put a whole new strain on legacy billing systems. If CSPs want a piece of the action from utilities, they need to embrace making changes in their billing systems and processes to effectively engage with customers at every stage. These include:
- Providing an omnichannel experience—including mobile apps—to interact with customers across any device. One of the goals of smart metering is reduce electricity use. Customer need a medium through which to view their usage in real time, and then take an action to perform a remote connect/disconnect, or adjust payment options/methods on demand or in a scheduled manner from any channel (smartphone, desktop, tablet, telephone call).
- Understanding the impact of convergence. The convergence of mobile, the cloud and the Internet of Things makes the integration between apps, customer relationship management (CRM), enterprise resource planning (ERP), billing and rating a huge challenge, especially since different capabilities like reside in different systems (including inventory, billing, provisioning, usage, etc.). Providers need to look at their business process management in an end-to-end manner and consider consolidating under a single master system of record. This ensures that the information is captured in the most consistent manner and made available to the right people at the right time across any channel to support improved productivity and increased customer satisfaction at the lowest possible total cost of ownership.
- Providing a secure framework that provides proper authentication and authorisation to protect sensitive customer data.
- Utilising accurate, scalable real-time rating capable of scaling to support millions of connected devices that are sending usage data in real time. Two-way connectivity helps inform the customer of specific usage thresholds and the actions to be taken in real time. Emerging prepaid energy models should also be supported.
- Understanding what analytics will be important to this market. Billions of records will be generated from smart meters. How can this data be used to make a real difference in the energy sector?
CSPs have a real opportunity to be the partner of choice for utilities as they embrace smart meters. Will they overcome the challenges and embrace the model that can help make this a reality?
The author is Flavio Gomes, CEO of LogiSense
