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The early results are in: Blockchain is a game-changer for the telecom industry. Early adopters are already realizing positive impacts to their bottom line by leveraging blockchain solutions to streamline operations amongst disparate teams, processes, and systems. Blockchain solutions have the ability to simplify complex and antiquated business operations to align intercarrier business models more closely to their true purpose—that is, the interoperability of networks to facilitate the global economy and power the 4th Industrial Revolution.
The telecom industry has been at the forefront of technological and economic advances since inception; however, by today’s standards, it is a laggard to modern business in day-to-day operations. Blockchain solutions have proven a viable solution to simplify the complex and changing environment in a way that allows for accuracy, trust, and transparency in each business exchange. Carriers have the opportunity to modernize with blockchain solutions and recapture their forward-looking persona.
Current Inefficiencies: Contract, Billing, and Dispute
The current telecom contract, billing, and dispute environment is rife with inefficiencies. These inefficiencies can largely be resolved by instituting smart bilaterals and omnilaterals. The legacy billing systems being utilized by the carriers today were built to bill a Time Division Multiplexing (TDM) network. Newer technologies do not fit into the same mold of the legacy networks as designed. The industry standard regulatory groups that built out the billing practices and procedures for the TDM network were focused on data elements that correlated to the technology at that time, i.e., switched access, special access, and private line services. Carriers were left trying to fit new technologies into billing and ordering systems that were not created for those technologies. Additionally, the pricing for the legacy TDM network was largely regulated. For example, in the United States, the Federal Communications Commission (FCC) and the various Public Utility Commissions (PUCs) regulated much of the domestic TDM pricing. Services like Ethernet and Voice over Internet Protocol (VoIP) products, have contractual pricing that is largely unregulated. The lack of regulation has created a considerable disparity across carriers and their products, both from a pricing and billing practices perspective. The combination of antiquated billing systems and unregulated pricing has contributed to perpetual billing issues.
Telecom carriers have operated for too long with outdated back-office systems and costly revenue assurance and dispute processes extending beyond normal course disputes, accrual mishaps and revenue blockage to complex legal, regulatory, and compliance issues. The reactive patchwork method of approaching change by layering swivel-chair fixes to processes and systems has created a whole new set of problems at every turn. The financial, operational, and emotional impacts on all parties dealing with issues stemming from this environment constrict growth and innovation.
The Solution is Blockchain
The future of our business is in blockchain solutions that are comprehensive and incorporate the functional layers of the blockchain architecture. The telecom industry needs to prepare now for the future. Growth and innovation within the telecom industry extends beyond having the best marketing team to compete for subscribers. First movers will capture early synergies. Moreover, first movers will be able to strategically position from a reactive mode to a proactive mode to change and complexity—two constants in the industry.
Industry thought leaders, led by MEF, are formulating standards to pave the way for mass adoption. MEF and its members Sparkle and GoldConnect are operating nodes on the W3C DID standards-based Integrated Trust Network (ITN). MEF has also published the industry’s first standard for the telecom industry’s use of blockchain that defines smart bilaterals and smart omnilaterals—DLT-Based Commercial and Operational Services Framework – Billing (MEF 114). The member-driven organization will continue to be on the forefront of the industry transition to smart bilaterals and omnilaterals on blockchain. Sage Management has joined MEF to be a part of this exciting future.Tags: DLT, Smart Bilaterals, blockchain, distributed ledger technology