Direct-to-bill charging- the key to transparency and reduced customer churn by Mark Denton, Valista


Continuing bad press around the premium mobile content and services industry will continue to dampen customers’ enthusiasm for paid content at a time when many other options are becoming practical for customers to obtain content or services for free. TV voting services in the UK have been particularly badly hit recently and in the US the lawsuits over unauthorised charges for content continue to emerge. Whilst the fault for many of the recent scandals does not lie directly with the network operators, there is a lot they can do to help control the industry and restore confidence.

What are the real issues here? One which everyone involved in the value chain should be concerned about is transparency – which means the customer knows exactly what they are purchasing and are assured they will get what they paid for. Regulators in particular have been paying close attention to this recently. However, accepting that we do not live in a perfect world and that even the best systems will fail, working out the steps that need to be taken to ensure mistakes are corrected is a necessity. This involves making post purchase support and customer care readily available which is another very important issue.

Ensuring customers get what they paid for starts with knowing what a customer should get and the customer being informed of what they will receive. In the UK market, the operators have tackled the issue of customer transparency by working together to produce, and implement, the ‘PayForIt’ code of practice. PayForIt aims to provide a trusted brand which customers can recognise and as a result ensures all content providers work in the same way. It has received mixed reviews with some content and service providers claiming PayForIt has helped their business and others claiming the opposite.

It is definitely an improvement over the previous technology which relied on Premium SMS (PSMS) as the billing mechanism because it helps reduce a number of common errors such as failure to bill and billing without delivery both of which cause customer frustration and dissatisfaction. Relating this to the payment card industry, PayForIt provides equivalent semantics of authorisation before delivery and confirmation post delivery and ensures the customer can pay, and only pays once they have received the item they purchased.

PayForIt does not help in all types of content and services because it is too much of an overhead. Voting applications, chat, dating, etc. are all great examples of applications which are not ideally suited to this environment. Other locations around the world are following their own paths with similar initiatives to PayForIt.

In the US market, the operators’ approach to knowing what a customer is purchasing involves approving what is being sold by partners / content providers in advance of any sales occurring. Many operators have direct-to-bill systems in place, which once the items have been approved, enforce price points, spending limits, subscription limits and age restrictions.

Without this, operators rely on their partners knowing what is being sold and enforcing things like price points and age verification and whilst they may not be the ones getting fined by Regulators and Governments, it is their business which is also suffering as a direct result. Much of the reason these management facilities are not possible in the European market, is because of the lack of payment systems which control access to the operato’s payment systems and a reliance on Premium SMS-based billing. Without direct-to-bill systems which monitor and control payments, then only rudimentary controls are available to police access to custome’s bills enabling people to find ways to use the lack of control to their advantage.

Even with the best systems things can go wrong. It is important to customers to know if things do happen to go wrong that their operator can make things right. To do this the operator must have visibility t