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European iPhone Deals Raise Fresh Questions over Billing Clarity

As European deals for Apple’s iPhone are announced, the chosen operators will be well advised to learn from the experiences of AT&T Wireless in the US when it comes to billing users, says Analysys the global advisers on telecoms, IT and media. The kick to mobile data usage given by the iPhone in the US market resulted in some subscribers receiving bills that were very large physically – in extreme cases running to hundreds of pages – detailing every mobile data event. AT&T quickly changed the way bills were provided – issuing summaries rather than full details by default – but the issue highlights the mismatch that often exists between users’ requirements of bills and operators’ perceptions of what users want.

According to research carried out for the Analysys Research report ‘s The Next-Generation Bill: Commercial and Technical Strategies, customers are often baffled by unclear bills and – as a result – telecoms companies risk lower revenues and increased churn. The report argues that service providers put huge amounts of effort into developing new services and competing with each other on price, but much less into ensuring that bills are clear.

“What we are hearing repeatedly is that residential and business customers are increasingly frustrated by bills that make no sense,” says the report’s author Teresa Cottam.

“Marketing strategies are falling at the first hurdle: people are so worried about the cost of new services that they don’t even try them. They dread receiving their bills because they are unpredictable, and become frustrated because they don’t know how to change matters.”

The report argues that the bill is a unique opportunity for telecoms companies to communicate with customers and offers several commercial opportunities. “To deliver the optimal next-generation bill, service providers need to shake off outdated assumptions about their customers and gain a clearer understanding of their needs. If they do not change, powerful competitors from outside the telecoms industry are waiting in the wings to show them how,” says Cottam.

Key findings from the report include:

  • Not enough effort has been put into bill presentment (the way that bills actually look). Making bills more useful to customers will increase customer loyalty and cut the cost of queries
  • Business customers often fear the cost of new services, yet providing bill analysis to demonstrate benefits of service plan changes can be good for both customers and suppliers
  • In the wholesale market, bill cycles must shorten to improve revenue management for all parties.

In addition to its expertise in billing, Analysys undertakes consulting work with telecoms companies to review and modify tariff structures and price levels in order to maximise profitability and maintain competitive advantage. Analysys PriceManager (http://www.analysys.com/pricemanager) is a proven price-comparison and -impact tool for analysis that provides clients with a powerful means of comparing and analysing a wide variety of alternative tariff schemes.

The report is available online http://research.analysys.com/store, priced at GBP1700 (approximately EUR2450) plus VAT.

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