by Shawn Price, President
Today communications service providers are increasingly under attack from a new breed of competitor. No, it’s not the broadband or 4G provider down the block. It’s the device manufacturers, the content owners, and the cloud service providers. Today companies flock to Apple, Google, Netflix, Skype, Zynga and Facebook, while carriers are turning into increasingly irrelevant commodity services.
And the stakes are large. The organization Telco 2.0 puts the market for a new breed of services at $375 billion over the next decade. We’re talking video, music, SaaS apps, gaming, and cloud services. Voice – the cash cow of the carrier – will become simply a feature supporting these other services. The question is: Can communications service providers act quickly enough to make a shift in the services they deliver, the pricing and packaging they roll out, and the ways in which they interact with their customers?
Carriers are accustomed to long-term contracts and regulated lock-in. But those barriers are going away. Just last month Ofcom in the U.K. announced an 80% reduction in termination fees. True customer loyalty will come through the right product and service strategy aligned with how customers want to buy. Free trials, pay-as-you-go options, flexible billing frequencies, and an edition upgrade path. But with systems and infrastructure designed for the old lock-in model, how will providers support this new fluid subscription lifecycle?
Carriers are used to 18 month billing rollouts. See the $100M Amdocs debacle at Clearwire last year for a typical example. In the mean time, providers using the cloud, like Open Range, are going live in less than 100 days and SaaS companies like Box.net are experimenting with different pricing models up to 50 times in a year.
Carriers aren’t unifying their customers’ interactions. Sure, you might be able to check your minutes used with their iPhone app…but what if you could also upgrade to the next tier if you were about to go over on your data plan? You might have a handle on your data usage at home, but when travelling abroad I know that I shut off my data plan, else risk coming home with a 4-figure bill. Why can’t the carriers make it easy for me to see this happening in real-time and make the adjustments to my plan to accommodate what I really need?
That’s why today Zuora is launching a brand new product and partnership with Salesforce.com for the communications industry. We’ll be delivering billing and customer care in a unified solution for managing the entire subscription commerce lifecycle…entirely in the cloud. Zuora for Communications will give communication service providers the speed and flexibility to launch new services, price, package, and bill for services in new ways, and connect with customers across the web, over the phone, and on mobile devices. In fact, Zuora and Salesforce are already doing that for hundreds of companies, including Open Range Communications and Barrett Xplore.
But we’re not stopping there. Zuora is delivering a whole library of helpful tools to understand how Zuora for Communications can help everyone from the largest carriers to the hottest upstart service providers. Check out the Zuora for Communications whitepaper.