[Satellite TODAY Insider 08-15-12] The mobile network operator sector is set to lose nearly a quarter of revenues — approximately $300 billion — from a combination of fraud and billing error by 2016 if it does not resolve these issues, according to new report from Juniper Research published Aug. 14.
The report, titled “Mobile Revenue Assurance & Fraud Management: Business Strategies & Forecasts 2012-2016,” found that operator-billed revenues totaled more than $900 billion in 2011 as the level of billable events increased for the sector. While this data supports the concept of mobile networks as a healthy and growing market, Juniper analysts also said operators experienced an upsurge in leakage across revenue cycles ranging from sales to network configuration, rating and billing.
The report showed that mobile network revenue leakage levels were highest in the Africa and Middle East regions, where there are particularly high rates of interconnect bypass fraud, under which fraudsters avoid paying call termination fees. The report also identified SIM cloning as a trouble area.
“While such leakages ranging from incorrect billing to chargeable call records not being transmitted to the billing system for rating are often the result of system error, networks are also experiencing a sharp rise in fraudulent activity,” Juniper said in the report. “Lack of cross-departmental collaboration and information-sharing remains a hurdle to reducing leakage. Given that both revenue assurance and fraud management utilize the same data, operators can and should deploy a single technology platform that enables both sets of operations.”
Juniper Analyst and Report Co-author Windsor Holden argued that network operators would be able to substantially reduce the scale of potential global leakage by more than $250 billion by 2016 through the implementation of revenue assurance and fraud management solutions.
“Introduction of a more formalized risk management approach will significantly alleviate these issues,” Holden wrote in the study. “By consolidating and automating its operational processes, the mobile network operator can establish a 360 degree visibility of the complete revenue chain in order to detect hidden losses or fraudulent activity rapidly. What is required is a combination of real time analytics and proactive business intelligence.”