life,
the universe
and revenue assurance
I do not usually blog about what I do - it has something to do with respecting client confidentiality and all that. But at last I can publicize some really good news about the revenue assurance maturity model. It has been approved by the TM Forum, and what is more there is a new training course to support it. To find out more, look at the full entry on my community pages.
Every week I monitor posts to the so-called Global Revenue Assurance Professionals Association (GRAPA). I find it to be a good way to switch off from real work for 5 minutes, so long as I can find a way to fill the 4 minutes and 30 seconds remaining after I have read all the posts... twice. So you might say that Papa Rob and GRAPA has failed to make lightning-fast progress. But even I found it hard to believe what they were still debating last week.
Topic: Definition Discussion
Posted: 13\May\08 at 09:40
....Revenue Assurance is the function / process of Identifying the Risk to revenue, Quantifying the Risk to Revenue and responding according to Management's appetite for risk. (the reponse includes reporting and containing the risk)
Geez. They are still debating the definition of revenue assurance. Come could in pretty handy, I suppose, if you just got a new job doing revenue assurance and opened your new Certified Revenue Assurance Professional's coursebook to lesson number one: what revenue assurance is. Not that handy for anyone already working in the field. There was a time when you could not go to a conference without at least five different speakers offering five different personal definitions. You do not get that any more - it was getting mighty boring for anyone in the audience. It looks like the people on the GRAPA forum are still chugging through them; perhaps they will end up compiling an authoritative list of the several thousand definitions people have proposed over the years. They have so far forgotten the half dozen different definitions that Papa Rob included in his own book, which is a bad start given that GRAPA was planning to use his book as the de facto textbook for its qualification. Thankfully, the TM Forum defined revenue assurance back in 2004, and has not changed its definition since. GRAPA has been going for a year now, and is still debating what revenue assurance is. Methinks one organization is getting bogged down in the trivial stuff and failing to deliver the useful guidance it originally promised.
Definitions are trivial. They only help people who do not know what the words mean, and want a 5-second answer. They may be useful to many, but only to those who have no interest or involvement with the detail. They help with promotion to new markets, and not much else. No definition will be universally popular, as everybody will have different aspects of revenue assurance that they would want to emphasize or exclude. If GRAPA has any serious pretensions to issue guidance and standards, it needs to move on from the definition debate and deliver something of substance.
Do you want an example of an organization that defines things? The Oxford English Dictionary. Those employed to write dictionaries spend their time exhaustively searching for sources that reflect how words are used. They then write an objective definition that reflects how people actually use the words. In that spirit, here a few more definitions:
GRAPA (grä-pə) n. Organization that exists for the primary purpose of making consultant and author Rob Mattison the Global President of something.
CRAP (krap) n. Certification from GRAPA attained by buying books written by, and attending training seminars hosted by consultant and author Rob Mattison. a. Unintentionally funny but accurate description [example: that jobseeker has CRAP qualifications].
Mattison (klaun) n. (1) Someone who works as a consultant and author. (2) Founder, father, inspiration and lifetime global President of GRAPA. (3) A kind of hot air balloon that repeatedly inflates itself.
Well, those are the definitions you get if you read my dictionary... ;)
Razorsight, the revenue and cost optimization vendor headquartered in Fairfax, Virginia, USA, has been ordered by a court to pay US$4.5m in settlement for stealing intellectual property. The property was stolen from TEOCO, another revenue assurance and cost management vendor based in Fairfax. The story is that former TEOCO employees, including Razorshite founder and Chairman Sundeep Sanghavi, had long been using TEOCO's intellectual property as part of their rival offerings. The court has also judged that Razorshite must immediately stop using TEOCO's intellectual property, must remove, destroy or return the intellectual property in its possession and its deployed systems by September 1, and should be subject to an audit thereafter. The court's decision was made somewhat easier by the admission of liability by the defendants. TEOCO discovered the theft in mid-2007, though the subsequent lawsuit's discovery process revealed the extent of the theft was greater than they had first thought. You can read TEOCO's press release here. Look here for the official court order of the US District Court for Eastern Virginia.
Not surprisingly, there is no mention of the contravention or the court order on Razorshite's website. However, there is a press release dated May 19 that tries to give the impression that Razorshite is moving in the right direction. It states that Razorshite's VC backers have pumped another US$9m into the company, in order to “expand Razorsight’s innovative product set, accelerate the company’s international expansion... and to support strategic global alliances.” What a load of bull. Half of it will go straight to TEOCO. Presumably the other half will go on development to replace TEOCO's stolen intellectual property, the costs of ripping out the stolen property and on kissing customer butts. Some of those customers must now be wondering whether they picked the right vendor in the first place, given they were unwittingly using TEOCO's intellectual property. You can read Razorshite's humbug press release about new funding here.
Intellectual Property theft is more common in revenue assurance than most people care to admit. That is a damning statement, and so it should be. There is hypocrisy in selling the goal of integrity and compliance with legal and accounting expectations, whilst knowing the offerings were stolen from somebody else. At times revenue assurance is like the Wild West of telecoms. It has the right cast of characters: prospectors, sheriffs, pioneers, gold diggers, madams, company men, bandits, and engineers. We can now add outlaws to the list. I have written before about the tendency for people in revenue assurance to help themselves to other people's work. Part of the problem is that too many turn a blind eye when it happens, or worse still they are happy to indirectly benefit from the crime. Eventually the Wild West was tamed, and civilized. The honest folk won because they stood up to the troublemakers and lawbreakers. Next time you see, or suspect, the infringement of intellectual property rights, remember it is your duty to speak up. I am sure you feel the way I do: rewards and recognition should go to the people who deserve them, not to the people who will stop at nothing to get them. Honest people can win, if we stand together. We must stand up for honesty, or we all risk being branded as cowboys.
I remember that a few years back quite a few people started talking about how the retail telecoms sector and the retail banking sector would start merging into one. The theory was that telecoms had the devices in people's pockets and the systems to handle an awful lot of microtransactions, whilst the retail-oriented financial institutions had the big, and profitable, business of managing people's money and charging them to move it around. Mobile phones would not only support mobile banking, but would also replace cash and credit cards. Because you can communicate with a mobile phone, and because the phone has a display and can present information to the user, a phone should be the safest and most secure way to handle money. Once mobile operators had gone to the trouble to implement systems to manage prepay account balances in real-time, it seemed like a small step to allow those balances to be used to pay for anything and everything, not just for phone services. 3G would supply the necessary bandwidth, and mobile payments would generate some of the money to justify the investment in 3G. As a result some phone companies started talking about and getting banking licenses. However, progress has not been as rapid as some people expected. Many years on, and use of electronic money is nowhere near as ubiquitous as cellphones are. In fact, the growth of mobile payments has in some ways been most popular in the developing world. Take a look at this interesting blog for a discussion of reasons why.
One challenge to mobile electronic money is that not many people are confident about the know-how possessed by many telecoms firms. Concerns about security and data integrity in telecoms mean that online payment systems that treat electronic communications as a bitpipe have made far more ground than any attempt to integrate banking with the process of managing and settling phone bills and accounts. I suspect part of the reason for doubts over telcos is that, in the final reckoning, operators are just operators - the may just about know how to run things, but they rely on other, bigger, companies to do the R&D, development and even install of the technology they use. Cisco and Nortel are to operators what Boeing and Airbus are to airlines. In the end, the operators are all pretty undifferentiated - at least the airlines decide what selection of meals to serve during a flight. The pace of change is more likely to be set by the push from the big network and technology vendors, and less likely to be set according to the limited pull of most operators. Only the really big players like Vodafone set the pace with vendors. Another, but somewhat related difficulty is that customer interest is modest. Ambitious projects to get more and more products and services on one bill have received only lukewarm interest from customers, and is not helping to generate significant additional revenues. More importantly, customer distrust of the track record of telcos has guaranteed they will be suspicious and fearful of using telecommunications to manage money. Telcos are not going to push furiously and invest heavily in services which customers seem reluctant to use - they have done so plenty of times in the past, and been burned as a result. Customers are not just distrustful of telcos, but their reputations are no better than anyone else's, and increasing numbers of high-profile stories about lax data security will just encourage people to take a blanket negative attitude to any new technology for managing money that has not already been adopted by their friends and neighbors. However, I think these problems are surmountable, and more progress could have been. In the background, it would not surprise me if exec egos are another real obstacle. Until recently, the banking institutions were the ones with all the profits and the execs with the egos to boot. Recent events have laid the finance sector low, but you can still expect they would think of themselves as the senior partner in any hook-up with telecoms. In turn, I imagine the telco execs are less than keen to get themselves in deals where they risk being treated like backwoods cousins on every level from marketing to technology.
Whatever the reasons for the relatively slow transition to electronic money, it is coming, and I recommend you keep aware of progress by reading this very good blog on electronic money from a firm specializing in that sector. Electronic retail payment poses a new challenge for telecoms revenue assurance, but not for the reasons that might first come to mind. I also remember that when the merger of banks and telecoms was taken more seriously, a few overeager souls were looking forward to a future where banks would be turning to people from telecoms revenue assurance to help them with integrity. Having seen a little of what big financial institutions are like from the inside, I always thought that was fanciful. The banks have processing integrity hard-wired into their mentality. The war stories and case studies of a few rinky-dink telecoms revenue assurance guys are hardly likely to impress businesses that live and breath reputations for handling money without mistakes. No, the challenge for revenue assurance in telecoms is going to be more subtle. In a world where error rates and integrity expectations are set by the big retail banks, telcos are going to have a tough time to persuade them they can meet those expectations. If they do not, the operators will end up being junior partners and maybe just the bitpipe providers. The trick will be to turn around the win most, lose a few attitude to data and revenue integrity found in most telcos into the failure is not an option culture that the banks demand. Either revenue assurance will be at the forefront of that transition, or the transition will brush current revenue assurance practices aside, turning them into a sideshow. I know which I would prefer, but I also know that many in revenue assurance are simply not ready or qualified to lead the fight for error-free transaction management. The slow transition to electronic money has bought telecoms revenue assurance some time to prepare for the onslaught, but it will come, and when it comes, given the current state of revenue assurance progress in most operators, there will be casualties. Now is the time to toughen up, before it is too late.
The telecoms software industry is consolidating. This is equally true of revenue assurance software vendors, as we have seen from buy-outs and mergers in the last few years. In the last two years, we have seen Cartesian bought by TMNG, Praesidium and Cape taken over by WeDo and just recently Compwise was bought by ECtel. The trend will continue, but it will take a long time before the revenue assurance industry is reduced to the three or four major players that it can profitably sustain in the long run. To understand some of the factors, take a look at this very well-written article about the drivers and obstacles to telco software consolidation.
Mobile roaming is a matter of fact all over the world, but many customers are denied the opportunity to roam networks within their home countries. The reason is straightforward. By denying roaming between national networks, there is added incentive, and profits, from rolling out new network capacity. The operators compete on coverage and customers win in the long run as a result of increased overall coverage, though they may suffer in the short run as they find their network has coverage gaps and they cannot simply flip over to another network when that happens.
In the UK, one legislator has tabled a proposal to permit in-country roaming. Greg Clark, Member of Parliament, has introduced a bill to encourage, though not mandate, in-country roaming. It is unlikely to be enacted in law, but it is an interesting case of an legislator trying to help telecoms customers without trying to grab headlines by bashing telcos. To read an overview of Greg Clark's arguments, take a look at his entry on the well-regarded ConservativeHome blog. To read Greg Clark's speech to the House of Commons take a look at the user-friendly entry at TheyWorkForYou or look through the record of business in Hansard, the official minutes of the UK Parliament. You can also see the video of his Commons speech here.
I can sympathize with Greg Clark's reasoning, and could go further. Greg Clark's arguments are simple in order to garner sympathy for an argument that has marginal interest to most. Customers in rural areas would greatly benefit from the freedom to roam on any network that provides them coverage where they are. It also seems strange that emergency services are acquiring foreign SIMs in order to work-around the risk that loss of one network will disable their communications. Given the burdens often imposed on telcos by UK law, especially with respect to responding to emergencies and managing disasters, I would have thought that mobile operators can do more to facilitate multi-network access to special users. In-country roaming also has parallels with other aspects of telecoms liberalization. From the perspective of economics, regulation and consumer choice, I see many parallels between in-country roaming and Wholesale Line Rental (WLR). Domestic landline customers have the right to pick from multiple providers that will sell them use of the exact same copper wire to their home. That copper wire is offered at a fair wholesale rate to the retail provider. Restricting network use to the operator's own customers gives them an effective monopoly right over the network assets. This may not always be a bad thing, but then again, opening up access to the asset need not penalize the owner either. What matters most is whether the wholesale rates charged give the wholesale provider a good enough return whilst being reasonable enough for service providers to be willing to pay them. Roaming is no different to WLR in this regard, except that consumer choice is less of an issue when there are multiple networks serving the same geographical area. The point here is that multiple networks may be the norm in towns and cities, but not necessarily in the countryside. The use of the Radio Access Network can be sold at a profitable and fair wholesale rate to the customer's service provider. They in turn pass that cost plus a margin to the customer in exchange for the right to roam on another network. So long as the customer knows that they are roaming, and knows the price they are expected to pay, I consider it to be in the consumer's interest to have the choice.
There are counter-arguments to all of the above, not least that allowing roaming may discourage new build or that 3G network sharing is already delivering a similar result to in-country roaming. For an overview of counter-arguments, take a look at The Register's pretty negative response to Greg Clark's proposed legislation, and also read through some of the reader comments. However, it was interesting to note that there were well-informed comments on both sides of the debate.
As stated, Greg Clark's bill is unlikely to become law, but If you can track its progress through Parliament here. However, I think most of the arguments for and against are now irrelevant. The problem is that it would be very difficult to provide national operators with a decent enough return to encourage them to open up their networks to all rivals. The reason is the European regulation imposing retail price controls on roaming within Europe. The aim of this was to lower retail costs for European travelers, but the legislation specifically states that it also applies to retail prices for in-country roaming as well. If retail prices are low, then wholesale prices would have to be lower still, and if those are too low, then network providers have minimal reason to sell spare capacity to competitor networks. The competitors would benefit too much from having their outages and coverage gaps addressed at a low price. In reality, the network operator will opt to compete on network quality rather than gain a small income whilst eliminating a key differentiator with rivals. Even if Greg Clark's exhortation to permit more in-country roaming does become law, the network operators will most likely ignore it. However, the comparison with the EU's attitude to retail price regulation makes for a nice contrast. Instead of controlling the telcos, it is nice to see a legislator trying to help customers with a bit of creative thinking and by suggesting a potential win-win with telcos, even if telcos are unlikely to take it up. I think we would all like to see more of that.
In case you were wondering, the words in the title are in the order that I intended. A Google search on the string “extract load transform” returned 1,560 hits. Searching for “extract transform load” generated 88,400 hits, so I am not going to argue about which is the more common sequence for processing data. For the uninitiated, Extract-Transform-Load (ETL) means getting data from the source systems, transforming the data at a way-station then moving it to its final destination, whilst Extract-Load-Transform (ELT) means doing the transform at the end point. Why, then, am I talking about this? The technology to get lots of data from source systems to somewhere people can query it happens to be one of the enabling pillars of modern revenue assurance. If somebody else in the business can do this more efficiently, like the people working on data warehousing in the IT function, then revenue assurance will be able to reap the rewards.
I am not in the business of selling other people's products, but I recently attended yet another glowing vendor presentation about Netezza, the makers of software to manage data warehouses. This time the presentation was from Carphone Warehouse, the UK multiplay provider. In their presentation, they explained the difference Netezza had made to their revenue assurance. As I have said previously, I am no natural fan of theory that revenue assurance is just a matter of implementing an ‘RAdb’ - a big database used to query lots of data relevant to revenue and cost integrity. There is a lot more to revenue assurance than pouring as much data as you can into a big bucket, stirring it around and then sticking your head in to see what you find. That model is fundamentally reactive. Vendors like to play games with language and pretend that spending gazillions of dollars to reduce processing timelags from last week to yesterday to an hour ago to a minute ago somehow makes you proactive. Reacting rapidly is not the same as being proactive. Reacting rapidly still involves allowing something to happen and then reacting to it. Processing speed just reduces the potential delays in reaction. Processing power gives you potential, not a guarantee of results. No matter how much data you have and how quick you can process it, finding leaks will still take longer than your lifetime if you do not know what to look for, or if there is no data of the type you need to highlight a genuine problem. You can spend all you like on Business Intelligence but the results will be worthless if you cannot apply some human intelligence. That said, the dynamic of how to address revenue assurance using systems has changed a lot in the ten years I have been working in the field. Raw processing power is threatening to turn the principles of how to best exploit data on their head. Models for how to work that once seemed obvious may be set aside. I am not a spokesperson for Netezza. I have not seen enough to tell if others are delivering similar results; it could be that Netezza are just much more focused at targeting the revenue assurance market for sales. If vendors of data warehouse appliances see revenue assurance as a market worth targeting, that is no bad thing. What I do know is that Carphone Warehouse says they have gone through a paradigm shift by engaging Netezza and by changing to ELT instead of ETL. If what they say is true, the long-run implications for the future of revenue assurance may be very significant. It may ultimately mean the end of dedicated revenue assurance tools as we know them.
The days of code monkeys creating reports based on what they know how to do, rather than what the business needs to do, are still with us, but those days are numbered. RA vendors are much slicker at giving customers what they really want these days, and there is much less room for those one-off in-house developers that you would find creating reconciliations that fell apart the moment they left the company. The species of code monkey that tried to pretend they knew RA when talking to technologists and tried to pretend they knew technology when talking to RA people is reaching its evolutionary dead end. However slick the RA-specific vendors get, they now face a serious competitor in the form of leveraging general-purpose data warehouses for RA. For a variety of reasons, dedicated RA tools have always been more popular with RA practitioners than trying to run relevant queries on an enterprise data warehouse. But this may change. If the data in your enterprise warehouse was accurate, robust, detailed, comprehensive, and up to date, why would you want a separate revenue assurance system with separate feeds querying its own version of the data? And if the tools around the warehouse allowed the revenue assurance users to perform queries alongside all the other users of the warehouse, without any impediment or obstructions, what is the advantage in having in a dedicated RA system? I admit I can think of a hundred reasons why life may not be as simple as that, but all I am saying is that if it were that simple, it would be hard to argue for the need for systems dedicated to RA that in essence are there to crunch data that could be crunched elsewhere. This brings me back to the title of this blog. Extract-Transform-Load is intended to handle the processing of data most efficiently, but it can encourage a mindset that sees revenue assurance as making unreasonable demands for the volume, quality and speed of processing data. Pressure to make ETL more efficient can lead to decisions that undermine the goals of BI and of revenue assurance in particular. For example, if extraction is a problem, extract less - but without detail then the power of analysis is lost or at least reduced. If revenue assurance is competing for scarce resources with other parts of the business that find it easier to justify their data processing requirements, then stop trying to support the RA team, or give them their own very own half-baked solution. The latter will probably shut them up - it guarantees a few jobs and if it does not work properly then chances at least some of the blame can be shifted from IT to RA when individuals in the RA team foolishly make the mistake of overestimating their own IT skills. The code monkeys employed by RA functions are not going to change their ways and announce their own limitations, after all. The attention-grabber in the Carphone Warehouse story was the benefits gained by changing to Extract-Load-Transform, and performing transformation on Netezza's CPUs, whilst cutting out some of the extract and load that had been taking place on their ETL servers. For revenue assurance in Carphone Warehouse this resulted in daily extracts that completed 5.5 hours earlier each day, and a 3.5 hour improvement in availability to the end user.
Getting a report to an RA analyst three and a half hours earlier is unlikely to make a whole lot of difference to the bottom line, but it does mean that Carphone Warehouse is having success with an approach that levers common information for multiple stakeholders, including revenue assurance. If that cuts out the cost of needing a dedicated revenue assurance system, that will be where the real saving is.
Billing & OSS World magazine, like seemingly everyone else, hands out awards for excellence. Like everyone else, they get judged by a lot of experts and the competition is supposed to be really tough and there are lots and lots of very good entrants. Ho-hum. I hope no telco is stupid enough to pick their supplier based on an award handed out this way. Reading the list of winners at the magazine's site, and the press release from Oracle, I am no wiser as to what Oracle did, why they won or how the decision was made. That tells me everything I need to know about this award and why Oracle won it. If a supplier cannot describe in plain language what their product does, any why you should buy it, then sensible customers should look elsewhere. Presumably Oracle did a better job when explaining their product and its merits to the panel. That or they paid the biggest bribes.
Indian revenue assurance software business Subex has announced a net loss of US$17m for the financial year ending 31st March 2008. Subex's boss, Subash Menon, described it as a "disastrous year". Whilst revenues have grown rapidly as a result of acquisitions, costs have also grown sharply. Subex registered operating losses in the first, second and fourth quarter of FY08, and registered only a modest operating profit in Q3. The business gave the following reasons for its poor performance over the year:
The business announced it had realized by Q4 the cost savings it had anticipated following the acquisition of Syndesis, the service activation outfit. Subex anticipated this would translate into annualized savings of US$12m. This in part was used to justify a forecast for FY09 of revenues up slightly at US$125m, and profits after tax of US$12m. Subex also expected to be cashflow positive in FY09. You can see the headline announcement here and the results presentation here.
The results from Subex are a disappointment, and Subex had better be wary of giving investors the impression that their forecasts cannot be relied upon. Revenues for FY08 totaled US$121m, well short of the original forecast of US$150 and still short of the revised forecast of US$130m they gave half way through the year. Subex originally forecasted profits after tax of US$38m for the year, and was still forecasting a US$26m profit after tax in its reforecast. This means actual profits were a full $55m worse than forecast at the outset of the year, and US$43m lower than predicted just over six months ago. You can read my blog about the reasons why Subex cut their forecasts here. Obviously their reforecasting exercise was not pessimistic enough. Badly failing to meet revenue and profit guidance in FY08 will greatly increase the pressure on Subex to deliver on their FY09 forecasts.
Hot on the heels of the publication of these results comes more bad news for Subex. It has been reported that economic events have increased the foreign exchange risk for the US$180m Subex has raised from Foreign Currency Convertible Bonds (FCCBs) which are due for redemption in 2012. See the story here.
The news is bad from Subex, but their predictions remain bullish for growth and a return to profitability next year. Much of this must be premised on the idea that the dead wood has been removed from the business following the integration of acquisitions Azure and Syndesis, and that they will return their focus to gaining new orders and improving efficiency. The firm did not take the easy option of blaming its results on a downturn in the market. Subex instead insisted that there was underlying growth in the market, and that they expected this to continue next year. The failures in FY08 had reflected Subex's own problems and was not a sign of overall market weakness. Subex stated it believes the global telco software market is growing at between 10% to 12% annually. The plan from Subex hence remains the same: be big because telcos will increasingly want to focus on fewer, bigger, suppliers. Subash Menon explained his outlook:
Telcos will look for significant partners and would like to move away from smaller players
Subex are setting out their stall. The market for their products continues to grow, and Subex intends to stay big and to take a big slice of the market. To cover their cost base, they need to generate US$125 of revenues to give a good positive return. They have little room for failure. With investor confidence knocked they need to deliver next year. They also need a good positive run in following years if they intend to refinance their FCCBs in 2012. Subex is betting that their strategy is right. They plan to be a big player in the revenue assurance, fraud management and service activation software business, and expect smaller players to fall away as competitors over time. The strategy sounds right, the challenge will be in execution.
In The Hitch-Hiker's Guide to the Galaxy, Douglas Adams created a plethora of memorable minor characters. One of them was Rob McKenna, Rain God. This mysterious web page suggests I am not alone in remembering the character. McKenna hardly appears in the stories, but he is easy to remember because he is a truck driver who is constantly rained upon. As the story explains,
"And as he drove on, the rainclouds dragged down the sky after him, for, though he did not know it, Rob McKenna was a Rain God. All he knew was that his working days were miserable and he had a succession of lousy holidays. All the clouds knew was that they loved him and wanted to be near him, to cherish him, and to water him."
I think of Rob McKenna whenever bad luck seems like an inadequate explanation of events in my life. Though it is not true, I sometimes think of myself as a God of Billing Errors. It is not like I am looking for them. On the contrary, I wish they were not there. It just so happens they keep looking for me. Unlike McKenna's rain and truck driving, I guess being plagued by billing errors can be an advantage in my line of work. It certainly makes life easier, except when it comes to checking my own bills. I have to scrutinize them very carefully, which is annoying. Now, I had thought that we had a cataloged every kind of leakage in the TMF RA Guidebook. But I can proudly announce, after an investigation of my own landline bills which began in November 2006 (!) that I have identified a completely new genus of leakage. I have never seen this kind of leakage before, and never heard anyone else describe a leakage of this type. If I was a Victorian botanist, I would hope it became known as Priezkalns' Leakage Point. However, I am not so sure I want my name associated with somebody else's mistake, just because I happened to find it. Instead, let us call it indefinite ongoing carry-forward leakage.
Back in December 2006 I blogged about how BT had made a mess of billing, crediting and taking direct debit payments from my bank account when I stopped using them as an ISP. The conclusion of that story was that BT had strangely decided to collect UK£1.65 too little in my November 2006 payment, and that the UK£1.65 reappeared on the following month's bill as a brought forward item. You will have to go back and read the original post to understand why there was a UK£1.65 anomaly in the first place, because the explanation is an epic in its own right. I thought that carrying forward UK£1.65 to my December 2006 was the end of the story. I was wrong. In December 2006 my direct debit payment was again UK£1.65 less than the amount on the bill, and the value was brought forward to my January 2007 bill. The same thing has happened in every month since, with £1.65 being carried forward every month, and never being paid. Before you ask, yes I did check my bank statements every month, and every month the payment was UK£1.65 less than the figure stated on the bill. In March 2008, the same thing happened again, with my bill total including UK£1.65 brought forward from the previous bill, but the payment taken from my bank account was once again UK£1.65 less than the bill total. However, in April 2008, something changed. There was no brought forward line in the bill summary. The UK£1.65 had disappeared completely. It was nowhere on the bill. When payment was taken from my bank, it was equal to the amount on my bill for the first time since this had all started in 2006. For sixteen months BT had repeatedly postponed collecting the UK£1.65 it was owed, shifting the amount from one bill to the next. In April 2008, seventeen months after the payment was due, it seems BT gave up and wrote the amount off. No doubt the data was chugging round some interminable processing loop all that time, and finally reached an age where the data automatically expired or when somebody decided to purge it. Presumably BT's age analysis lacks the sensitivity to identify such a small amount, or perhaps it does not occur to anyone to monitor aged debt for customers who pay automatically from their banks and where the payments are always successful. Hence, courtesy of BT, we all have a new kind of leakage to look out for: indefinite ongoing carry-forward.
BT's bills have been audited to prove they do not underbill, to an accuracy of 0.05%, as well as proving they do not overbill. Hmmm. On the basis of this error, the leakage rate for my own bill is more like 1%. The audit also checks that no items get billed more than 3 months late. Hmmm. At least by writing off the amount in error, BT have spared me the trouble of complaining about making a collection that was well over a year late. One excuse for BT is that their audit only covers some of the products on the bill. My error related to broadband, which is one of the products excluded from BT's audit, though it looks like this technical glitch could have occurred in relation to any product on the bill. Confused yet? Most people would be. The reason for auditing is to supposedly increase consumer confidence. Hmmm. Based on this performance, excuse me if I keep on checking my own bills. Checking my own bills is a nuisance, but I would rather not rely on the auditors of these bills, with their quirks, obscure rules and penchant for treating every mistake as a special case that can be ignored. It has taken me many man-hours just to review my own bill, and each year these auditors have about the same amount of time to review all of BT's systems, processes and bills. They would attempt to audit a mediation platform in no more time than it took me to write this post. Consumers are better off relying on themselves than on auditors that seem to be accountable to no-one. If forced to make a choice, I would rather take my chances on a driving holiday with Rob McKenna, Rain God. At least we could share stories about our bad luck.
Are some ISPs choking the supply of broadband? Yes, according to the people at Vuze. Depending on who you are, interrupting and slowing the flow of traffic might be described as either network management or traffic throttling. Vuze, suppliers of a peer-to-peer video delivery service using the internet, have a vested interest in ensuring traffic flows freely. Otherwise there will be degradation in the quality of their service. Late last year Vuze petitioned the FCC, the American regulator, to set rules for fair management of networks. Their concern is that arbitrary interventions may create an unfair market, with some services severely impeded whilst rivals are allowed to flow without obstruction. Vuze have followed this up with a network monitoring program, which they say highlights excessive throttling by some ISPs. They created a plug-in to monitor network interruptions suffered by their customers. The first batch of Vuze results on interrupted network communications, covering January 1 to April 13, is now available. The results are startling, with the median reset rates varying from 2.53% at best to 23.72% at worst. This would seem to support their conclusion that some ISPs are using false reset messages to throttle the internet.
What moral do I draw from this story? It is too early to reach a definitive conclusion on whether network throttling is happening and how much of this is primarily intended to slow internet traffic. What we can conclude with certainty is that telcos can no longer hope to hide the truth of their performance from their customers. As the world gets more wired, it gets easier to check the wiring. Time was telcos only worried about regulators, but with so many businesses and entrepreneurs now having a stake in the internet, an increasing number will emulate Vuze and gather data to protect their interests. Simple techniques like the one employed by Vuze can be used to highlight anomalies and objectively measure performance. The truth is out there. Telcos better beware, or they risk being caught in their own net.
Copyright © 2008 Revenue Protect Limited
