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Parcel Clouded in Dublin

  • It's not Madrid nor Lisbon ... it's First Capital Connect to London Kings Cross and I am using Swipe on my N8 to get this Blog out. So perhaps the subject of today’s rant should be less grandiose (or paranoid) than usual. Given that I will be in Dublin next week at the TMForum ( to discuss Billing and the Cloud... maybe I should stick my knitting for once.

    Billing Cool?

    In my defense, billing can be cool. Even the standard Telco-run-of-the-mill-post-and-pre-paid kind.

    While writing about billing in CEP (courier, express and parcel), discussing issues in interchange in Merchant Banking and working on a TMF survey on Cloud billing - I came across a few articles and statements from the Customer (buying) side on the importance of understanding the Providers (sellers) economics, business models and ultimately their billing capability. Overall – only with this understanding in hand can the buyers negotiate the best deal.

    What I really liked were statements on "identifying the provider’s selling cycle" ... When and how they want to sell?

    CEP and logistics discussions were ruthless.... “Use the weaknesses in their billing ...their inability to comply with how you want be charged and use these to extract concessions on rates”. In other words the lack of ability to adapt billing to the commercial needs of buyer plays right into their hands.


    You need to understand that the world of parcels is very different from Telco. Typically an eCommerce company of any size will have multiple delivery networks working for them at the same time. The delivery carriers not only compete to win the business but more importantly to make sure they get the most volume of the highest margin deliveries on daily basis. The sales battle only begins with signing the agreement


    The capability of the carrier’s billing system to incorporate the terms and conditions of how the customer wants to get billed critically determines how much business they get day by day.

    It is important to note that the eCommerce retailers that use the parcel delivery carriers are not really the end customer. The end customer is the philatelist that bought that rare Kiribati WATERMARK BUTTERFLY postal stamp on bidStart that insists that it be delivered into his to his home before 8am and absolutely not left in the wood shed.

    In Telecommunications – competition is really concentrated on winning the business. There is certain level of stickiness that front load the competitive process - as changing providers is more akin to rewiring than just letting a new van back into the loading bays. The push to have infrastructure in place to pick and choose who carries a call – on a call by call basis – never took off in the retail market. Only in conferencing has this level of choice existed – ergo the need for billing to be integral in the contract negotiation process and in driving continuing business there way.

    Well – as I will be at the TMForum – and I am there really to speak to friends and foes alike about billing in the Cloud – you might guess where this Blog is going. I have argued (outside of this Blog) that the Cloud business model is more akin to Airlines than to Telco’s – where the key objective is to sell so as to maximize yields (fill all available seats on Southwest at the best price, utililize the full capacity of available CPU on Azure). Billing’s role is to make enable new contracts to incorporate dynamic charging strategies to win “on demand” business.

    The logistics industry analogy takes this one step further – billing’s role is to help win contracts with the large companies and incentivize them to “buy on demand – on a regular basis – as much as possible” … to chose one provider over another that also has a contract… and ideally to use those services that yield the highest margin.

    The fact that the Telco business model – including voice and network services – is evolving rapidly towards Cloud (and conferencing) type business models where the sale begins with winning the contract but continues as we compete to grab a share of high margin utilization – every day of every week of every year – makes the need to see billing as a keystone in contractual negotiations yet more imperative.

    For those interested in billing in the CEP business take a look at (very much like Telcoprofessionals). You will also see some amazing figures about the explosion and diversity of the industry at the Universal Postal Union

    Now for something completely different

    As for those interested in privacy (which I hope the TMForum will take a leadership position as I still believe the communication service providers are our last great hope) I did have an interesting conversation with Richard Harris a few days ago. His company Swivel has an elegant scheme where I can have a PIN but never have to tell anybody what it is, nor type it – I just have to remember it.

    Now if we can have scheme that could let me do that with all my personal information I would be happy. Though I think my back up drive is beginning to fail…

    Douglas Zone
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