Digitising Telco Roaming

By Nish Kotecha, Chairman and Co-founder Finboot

For anyone who has been to Europe for their summer holiday this year, you will notice that you can no longer roam freely on your UK mobile phone tariff. In addition to long passport queues and increased credit card charges, this is another so-called Brexit dividend…

The EU set up Roaming Regulation in 2017 allowing all in Europe to roam-free across their borders, which damaged lucrative revenue lines for telecom operators (telcos) across Europe.

Roaming extends the coverage of the home operator’s voice, SMS and data services to another country. The seamless extension of coverage is enabled by a wholesale roaming agreement (technical and commercial) between a mobile user’s home operator and the visited mobile operator network.

Telcos of which there are thousands globally, have constantly been in reinvention mode as their traditional business has been hit with technological advances which has put power in the hand of the consumer supported by regulators to encourage competition. Despite huge investments, they remain in a challenging market as data usage overtakes telephony. Value continues to be captured by other stakeholders including handset manufactures (Apple, Samsung etc.), application developers including the stores (AppStore and Google Play), infrastructure (Eriksson, Cisco, etc.) and content providers (Netflix, Amazon, Meta and Apple).

Telcos are complex organisations that are in need of rationalisation. Operating spectrum bandwidth is a costly play. You pay upfront and hope to recoup the value over time before you need to reinvest in new upgraded infrastructure. The challenge is the time between the upgrades is narrowing while the cost of investment between cycles is ballooning. What can be done?

Accelerated digitalisation may offer a way to reduce costs and increase margins.

Telcos’ product is digital – providing a core advantage. No need to tag to a physical product. Even the handset is a connected device allowing real time data upgrades. However, one significant challenge is the management of customers. This is a high frequency business, a bit like trading stocks. Customers change their service providers frequently and the two operating models: pre-paid and post-paid make customer management a muddle.

What if each customer could be tracked in a connectivity passport?

Building products and services around a customer could boost margins. Making each customer feel connected across the networks by sharing information, consensually. This could be achieved using a blockchain powered connectivity passport. Personalised connectivity could transform the industry. Telcos currently price by looking at the market and creating a similar set of packages. However, the one size fits all paradigm is outdated. Why buy a package when you need a menu or personalised services? Your very own menu of personalised connectivity services powered by blockchain.

Blockchain is the technology behind a distributed network of computers that can be used to store data securely but which, uniquely, has a single memory – a single source of truth. That means data cannot be freely copied and edited to create an alternative version of the truth, which is why Blockchain technologists refer to it as the “trust platform”.

A connectivity passport can store what services the user is using across networks and geographies. It could record all transactions across minutes, SMS and data and automate the bill generation, by using smart contracts irrespective of the network the user was using at any point in time. In essence, smart contracts are lines of computer code that can be programmed to execute a task if certain parameters are met without human intervention. For example, if a customer of Vodafone roams in Turkey via Turkcel each transaction is recorded – accurately and in real time in the customers passport. The actual usage data can then be shared to each network, enabling the creation of an accurate bill.

Most telcos still struggle to accurately charge, bill and manage customer records particularly between operators for customer roaming fees. There are software solutions in the market but they lack the integrity of a blockchain foundation. Without a trusted database collecting and storing the data collected between the operators, the is no single source of truth and the lack of data integrity requires a comprise settlement between the operators rather than one evidenced by actual usage. Furthermore, network providers can exchange information between their own legacy systems using a blockchain ‘digital asset’ – a file that is a record on the blockchain of usage.

Technology gives us a new way of managing connectivity around the customer… the idea of a customer connectivity passport may seem futuristic, but the technology is here today. Customers are demanding more value for less from the telcos. Unlike country passports, which incorporate restricted travel rights, a blockchain connectivity passport could be global.