Cellular operators 'leaking' revenues

According to Philip Sharpe, CEO with mobile billing experts - Cape Technologies, "Operators are undercharging their subscribers are lot more than they're overcharging."

Sharpe's colleague, general manager for EMEA, Emmanuel Doubinsky, estimated that as much as one to two per cent of traffic fails to get billed for. That sounds small but it could have a major impact on profits if recovered.

Naturally Cape is willing to sell its services to help operators recover that lost revenue. But Cape is also beginning to help out the content providers too.

Sharpe claims that some operators simply don't have the mechanisms in place to prove they're paying content providers the right money.

So content providers have to take their word for it that the network has sold X amount of ring tones. Unless they exercise their options for an audit. Which is where Cape comes in, of course.

It might well be worthwhile for some content providers to demand an audit. That's because operators are suffering from what is termed 'revenue' leakage, according to mobile payment specialist, Valista.

Evanna Kearins from Valista told the INQ that some mobile users - particularly those in France - are getting very savvy as to how mobile operators' billing systems work.

So, for example, they're downloading content - such as a ring tone - and then immediately turning their phones off. After about 12 hours the network stops trying to send the premium rate message which acts as payment for the ring tone.

Consequently then the handset is powered up again - hey presto - there's no premium SMS so the user has effectively downloaded the ring tone for free.

Each ring tone doesn't amount too much but over time it can add up to substantial amounts over time.

Crucially, as Kearins pointed out, in this case it is the content who effectively is missing out, not the mobile operator.

If more subscribers get wise to such tricks, then the content industry will be forced to sit up and take notice. And guess who will benefit? Valista and Cape, naturally. µ