Cutting up the profit cake the tricky part

By ADAM GIFFORD

You just have to get that new Britney Spears song. No problem - download it to your prepaid mobile phone, doubling as an MP3 player.

That scenario is not far away. Elements are with us already.

The tricky bit is resolving how the various parties in the transaction split the bill.

Liam Maxwell, product marketing director for Portal Software, a telco billing specialist based in Cupertino, California, says traditional billing systems were built to do voice and adapted to handle data.

"They get layers of customisation, but it's slow and debilitating to put any new services on," said Mr Maxwell, in New Zealand talking to customer Vodafone and other potential customers and partners.

"Just being able to handle phone calls is not sufficient.

"We're moving beyond dialled digits and duration of call to what was the IP address, or what network did they access, how many bytes were transferred, what was the quality of service, all the way to the other extreme of what was the content?

"Companies want to bill for value - for example, you could charge more for someone to download a new Britney Spears song than to download an old Liberace tune.

"One of the industry mantras today is, 'If you can't bill it, kill it'. We can pretty much bill anything out there."

Portal Software was established in 1985 to provide services to people wanting to access data networks. In 1996, it remodelled itself as a software provider around its Infranet system for managing next-generation services.

It now has more than 400 customers around the world, including three-quarters of the world's top 25 communications companies.

Revenues last year were $US268 million, a 130 per cent increase on the previous year.

Mr Maxwell said companies did not have a year or more to roll out new services.

"The two-and-a-half-G era is an age of experimentation.

"The life cycle of a service can be a week. If people like it and use it, it can continue."

He said telecommunications companies were increasingly aligning themselves with content companies as they looked for products and services that could hold customers and maximise the revenue they extracted.

"If operators just bill for weight - the number of bytes used - they lose the value.

"They can't distinguish what is happening on the network.

"When you go to a supermarket, you don't just take everything up to the checkout to weigh it and pay for it, so why should it be different on the internet?

"People are used to paying for the perceived value rather than the weight."

Mr Maxwell said operators wanted to maximise the number of transactions going across their network.

They also wanted to entice content providers to work with them, which required systems that could handle revenue sharing.

Systems also needed to handle real time as well as the traditional batch processing.

"If you are going to offer enhanced content based on location, real-time interactivity becomes important because privacy laws may require the operator to ask for permission to give location information to the content provider offering the service.

"People also want advice of charge - if you're downloading a Britney Spears MP3, you want to know how much it costs upfront rather than wait for a bill."