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IoT Billing Presents Complex Puzzle

It wasn’t difficult to identify 12 billing vendors to talk about Internet of Things (IoT) billing. And, in general, they all agreed that IoT presents certain common requirements that need to be addressed for billing, including:

  • Complex value chains
  • Innovative services
  • Rapid partner on-boarding
  • Multiple business models
  • High volumes of micro transactions
  • White labeling and embedded products
  • Multiple types of customer interactions

But billing for IoT is hardly static. For instance, some of the areas that likely will be developed in the coming two years for IoT include:

  • Industrial services, such as preventive maintenance, cost savings and Industry 4.0 initiatives
  • Services around connected cars, including usage-based insurance, and entertainment services pushed by the automotive industry
  • Smart Energy and Smart Home services, including home security

While there are many IoT-based startups, more companies coming into the IoT marketplace are interested in adding recurring-revenue services to their previous, more traditional transaction-based offerings. Communications service providers must be prepared to accommodate these customers with billing needs that are likely more complex and multifaceted, as a result of the need to support legacy products and services.

These are just some of the findings of the new Heavy Reading report "Billing Vendors Vary in Reactions, Solutions to IoT." This report examines the IoT billing market, utilizing data collected from 12 IoT billing providers. The report analyzes how IoT is impacting billing and billing solution trends, discusses drivers and challenges in the industry, and offers a comparative analysis of available IoT billing solutions. Looking forward, the report also details trends that are likely to occur in the industry over the next 18-24 months.

IoT is an exciting but still nascent industry, and despite significant investment from a range of heavy hitters, it remains to be seen just how warmly consumers will receive the first generation of IoT offerings. Billing providers that aggressively pursue the market at the expense of other verticals may suffer if these pioneering products fail to find large-scale adoption among customers. But providers that play the wait-and-see game risk losing ground to more daring competitors.

The successful rollout of IoT products requires quality billing support, but billing is only part of the puzzle. Once the product is on sale, the vendor must also be able to recognize revenue from it. This may be more complex than companies anticipate. In the U.S. in particular, accounting is in the midst of a genuinely seismic shift, as a combination of new revenue standards and more aggressive regulatory enforcement drives many businesses to reexamine their accounting systems and controls.

As IoT gathers steam, it is highly likely that there will be further regulations aimed specifically at this industry. How billing products integrate with revenue-recognition solutions, and how they support security and regulatory requirements, will likely be prime concerns for customers.

— Denise Culver, Contributing Analyst, Heavy Reading

kq4ym 1/10/2016 | 2:02:15 PM
Re: No less complex Just taking a look at a typical customer utiliy bill will show how complex the process is. Now expand the devices to billions more and we've got a really big puzzle to resolve to keep customers fairly informed whiile managing all the data for the providers.
nasimson 12/30/2015 | 9:13:28 PM
No less complex Just like IoT, IoT Billing is no less complex. Different taxation regimes, and the separation between beneficiary, user, biller, deployer, integrator, seller makes it more challenging.
kq4ym 10/26/2015 | 9:51:38 PM
Re: Billing Questions Will Linger And keeping the accounting rules in mind will bring lots of modifications and creative thinking as "regulatory enforcement drives many businesses to reexamine their accounting systems and controls."
Phil_Britt 10/19/2015 | 10:28:02 AM
Billing Questions Will Linger The billing questions will continue for many years, just as they have in "basic" wireless as all of the players try to ensure that they are receiving their fare share. 
MordyK 10/15/2015 | 3:55:58 PM
Re: IoT If I were a carrier I would head the department with a community manager from a tech company and eschew internal candidates, or at the very least use internal cadidtaes from the API side like AT&T's foundry or Telefonica Digital/Bluevia. Obviously at the integration level you can bring in the experts from around he carrier businesses.
Ariella 10/15/2015 | 3:35:36 PM
Re: IoT @MordyK That makes sense, though it is certainly a challenge for people to wrap their heads around new models.
MordyK 10/15/2015 | 3:30:37 PM
Re: IoT Ariella, I don't think there are any right or wrong answers in IoT, as every use case will be different and precoceived notions will only be an unnecessary hinderenace. The entire tought process of user ownership needs to be abandoned, with the euqestion being what can my assets enable.
Ariella 10/15/2015 | 12:01:32 PM
IoT Much to consider going forward, particularly the customer interaction question when various services are involved. Is each vendor to be serving the customer directly or to be a layered service for one particular brand?
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