Blockchain for Telecom | Pipeline Magazine

By: April Taylor

Telecom operators have operated with antiquated back-office systems for too long while struggling to automate cost reconciliation and financial assurance. The result is overlooked claims, time-consuming disputes, accrual accidents and income blocking. The reactive patchwork method of approaching change by layering turntable fixes to processes and systems creates new problems. The financial, operational and emotional impacts on all parties dealing with issues stemming from this environment limit growth.

That’s not a shock to anyone in the telecom industry; the current telecom ordering, billing and dispute environments are outdated and inefficient. Some of the inefficiencies are a byproduct of today’s legacy telecom systems that were built to bill and operate Time Division Multiplexing (TDM)-based services. In addition, the software community that built out billing practices and procedures for the TDM network was focused on data elements that correlated with the technology at the time, such as switch access, special access, and private line services. Finally, federal and state legislative groups regulated TDM products, streamlined prices, and administered subsidy tariffs.

Simply put, new 4G carrier technologies do not fit into the same old telecom network design. However, carriers are trying to incorporate these new technologies into billing and ordering systems that are not designed to accommodate them. Ethernet and Voice over Internet Protocol (VoIP) products, which have contract prices, are largely unregulated, adding further complexity.

The lack of regulation has created a significant difference between carriers and their products, both from a pricing and invoicing practice perspective. Product naming conventions no longer adhere to tariffed requirements, services are ordered from individual contracts (which are subject to frequent changes), and everything is left to a human to figure out. These inefficiencies can be largely resolved by establishing smart bilateral and omnilateral.

The telecom industry needs to get rid of the inefficiencies of today’s legacy OSS/BSS systems. To alleviate today’s operational problems, the successful future of the telecom business must include the functional layers of a blockchain architecture. Those operators who embrace blockchain technology will have a first-mover advantage and can strategically move from a reactive mode to a proactive approach to addressing change and complexity – two constants in the industry.

At its core, blockchain is an electronic system for managing distributed databases or ledgers, which are then shared across participant-approved network nodes. For example, carriers can leverage a blockchain solution to issue, rank, and validate real-time orders while sending ranked orders to the Diode-Transistor Logic (DLT) blockchain ledger for mutual approval or approval. In addition, a blockchain approach can systematically identify and correct order errors to eliminate costly chargebacks, future disputes, claims and improve mean time to revenue.

Not only does blockchain have a transformative impact on order and invoice validation, but it also provides similar efficiencies when applied to problem resolution management and service agreement enforcement. Standard performance calculations are recorded, obligations are monitored and corresponding claims are issued in an automated manner. This service level analysis results in tens of millions of dollars in annual savings for some of the largest operators in the world today.

In addition to the benefits of blockchain mentioned above, legacy systems such as graphical user interfaces (GUIs) and electronic data interchanges (EDI) can be eliminated as orders are transacted via blockchain. The demands on the staff from commission and customer handling to accounting are reduced as the systems are eliminated. Finally, immutable data ensures that no human intervention is required to support order and payment processing. Security concerns are greatly reduced with blockchain. Gone are the days when orders were processed online through a portal with shared passwords. Billing data is no longer accessible through a shared web environment and bypasses potential error handling.

Finally, carriers can now quickly scale their ordering capabilities because the technology allows for a distributed and decentralized architecture.

Blockchain benefits for the telecom industry are clear; it brings a deployment model and node scalability as well as:

• Immutability. Once data is stored, it cannot be altered or changed.

• Transparency. Participants in the blockchain have access to all data points.