Why CSG Is Betting on Blockchain
Blockchain technologies have reached into several sectors, including advanced advertising, during this technology hype-cycle. Now CSG Systems is diving into the mix to test how blockchain techniques can streamline complicated multi-year roaming contracts and inter-carrier agreements.
That work is being centered at a new CSG-run lab, based in Cape Town, South Africa, that will also kick the tires on other ways that blockchain and its distributed approach can be applied across the company's entire wholesale product line.
But the biggest opportunity for now appears to be in the inter-carrier settlement arena, according to Chad Dunavant, CSG's head of global management. Another potentially key area could be international roaming, which involves hundreds of operators.
Carriers, he points out, set up contracts with each other that span multiple years and with terms that can shift and change during that time as traffic is carried over their networks. Usually there's a big team of people to ensure that this information is not only relevant, but accurate to finalize settlements and issue invoices.
The blockchain, he said, could be a great way to maintain the accuracy of that info by managing ratings and settlements, as well as accelerate the general financial process of revenue collection.
For the lab, CSG is trying out a handful of blockchains, including the agreement blockchain (transactions between the marketplace and the customer); the event blockchain (managing and recording all events and traffic and usage that passes between two partners); and the financial blockchain (managing ratings and the processing of contracts once the rates are defined).
At this stage, CSG's blockchain work will focus on its wholesale product line, which centers on carrier-to-carrier settlements, rather than the BSS products used by major service providers such as Comcast, Dish Network, AT&T, Telefónica, Verizon and Bharti Airtel.
However, Dunavant predicts this blockchain-focused activity could also grow in importance in the pay-TV and OTT video worlds as service providers continue to integrate Netflix and other streaming services onto their set-top platforms and tie them into their billing systems. That settlement process will only become more and more complex, he said.
Blockchain tech, Dunavant said, could also help to reduce fraud, because the distributed ledger is traceable back to all parties involved and covers every action taken.
"The lab [will] kick the concept around enough to know it could be applied to real use-cases and add value," Dunavant predicted.
But he acknowledges that a tall barrier is getting enough carriers on board and having them agree to a common ledger. In the meantime, CSG is attempting to collaborate with the ITW Global Leaders Forum standards body for the wholesale market, on its blockchain activities.
"At the very least, we need two willing participants to work with us on this," he said.
Dunavant said CSG, which is using the open source Hyperledger for its blockchain work, has talks underway for next steps -- in the form of initial proofs-of-concept -- that could be presented to the standards bodies.
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— Jeff Baumgartner, Senior Editor, Light Reading