Policy Control and Charging – An Evolving Architecture Helping Disruptive Business Models

This is a short article on a relative “old” architecture, from the standardization point of view, but not yet fully used on top of its capabilities by the established MNOs (Mobile Network Operators).

Architecture Standards

3GPP Policy Control and Charging (PCC) architecture is an evolutionary not a revolutionary one. When it was proposed, their functions split off existing mobile IN (Intelligent Network, aka CAMEL) functions, translated from switch (voice) to packet domain.

The main architectural control elements specified are PCRF (Policy and Charging Rules Function) – for police control (a lot more than only QoS)  – and OCS (Online Charging System) – for charging control. Since its first release, it is ones core network architecture with more updates over the last decade, and still work in progress.

Driving New Services

Over the past years most vendors describe bunch of possible business cases to validate the heavy investment on network capabilities to support all newly policy functions. However, the evolving part of the architecture plays its role and most of new products launched were focused on online charging services, with pre-paid data plans potentials and variations being a must.

Abstracting the architecture and thinking about policy user cases, we realize that a lot of business cases didn’t come to light due to enough support on legacy packet network elements and even on standards (one reason for too many spec upgrades) and regulatory issues.

Speed Bumps

On the network side, the capability to detect and inform the correct user traffic and application were main bottleneck that 3GPP specification try to address, e.g. with the TDF (Traffic Detection Function). A great number of business models can be explored at this configuration, but it’ll require a new network element (or new capabilities on existing ones), and new interface to PCRF. Virtualization (SDN and NFV) can play a role here, easing new capabilities adoption and deployment.

On the northbound side, the 3GPP standards are less restrictive, and the MNOs should decide how easy would be integration of new services , by defining a good APIs set to expose those policy control and charging capabilities (see my previous article on online charging future here). Vendors support in providing an open and fully configurable application interface is mandatory for MNOs willing to explore those capabilities.

On the regulatory side, the policy control services face a great pressure from net neutrality rules on some markets. Less net neutrality should drive new services models, but its still unclear how deep political changes as seen with Trump’s election and Brexit will affect the current regulatory direction.

Evolution

As policy and online charging services are a cornerstone on MNOs market, the 5G ongoing discussion on core network architecture will certain drive another evolution round on PCC architecture, after VNF introduction as well.

Also IoT mass deployment will demand a strong policy control and differentiate charging from MVOs, something hard to achieve without a standard architecture.

Mindset Changing and Next Steps

As conclusion, the Policy and Charging Control architecture are a powerful technology for service differentiation. Though, a key paradigm on MNOs business systems must change.

Policy and Charging architecture should be understood as the lower end of the Operator’s service creation chain and not as core network elements. PCRF and OCS are better described as service platforms and service enablers’ functions, but they’ll add value only when tied on Operator’s service layer business process.

Operators’ online policy and charging capabilities must also be securely exposed to internal and external service partners to be able to fulfill the business models predicted by the industry.

 

Online Charging Future – Evolve or Die?

Technology and service evolution are affecting Billing and Charging process inside each mobile network operator (MNO), and contributing for IT and Telecom convergence. Progress in virtualization (NFV) and new services technologies (IoT, VoLTE, 5G) based on service API ecosystems will promote new revenue streams and distinguish business models.

Those advances are developing new opportunities for online charging and marketing offering flexibility. Both are key differentiators to unveil new services revenues for MNOs’ environment.

Industry Standards

But are the technology standards and architecture ready for these new scenarios? Two main standardizations bodies are applicable for online charging, one mainly focused on network and another on business process, 3GPP and TM Forum.

The 3GPP groups define all interfaces and protocols allowing the online charging system realization on top of mobile and convergent core infrastructure. Its specifications define also the functional elements to allow session based and event based charging functions. They are main reference for the traditional platforms used for pre-paid charging control in a network based service environment.

The TM Forum Business Process Framework (eTOM) defines the processes for Manage Balances and Charging of products and events inside the Customer Domain. These processes are part of Billing and Revenue Management and covers online and offline charging. They are main reference for business systems inside the MNOs’ IT domains.

Both standards set are perfectly complementary in theory, but in the real world we are watching a technological evolution that will permit the merge of these under a freshly online charging systems (OCS) concept.

Evolution Scenario

The future convergence is not only on platforms, but also on process and operations. We can foreseeing a future were all MNOs’ charging system will be online (OCS based), fully integrated into network authentication, policy decision resources and including all business processes ranging from subscription, advice of charging and reaching the billing invoice management.

On the vendors side this should represent a new solution development collapsing IT billing systems and Telecom platforms, open up opportunities and challenges in a new front between traditional IT and Telecommunications Equipment suppliers.

Challenges

But, Are the actual MNOs willing to embrace these technologies and process evolution? This is a question with no simple and straight answer. This is a strategic decision based on where each MNO believe will be their role in the future.

We can imagine a future complex scenario where the MNOs will deal with full convergent service bundle, including voice, data, TV, IoT and OTT partners in a 5G environment. This could require a rich and flexible charging plans, able to be customized to each subscriber and robust enough to handle residential and corporate segments.

On the other far side are the MNOs that will be forced (or chosen) to offer only the data connectivity to its subscribers, with flat rate charging style “one size fits all”.

The two scenarios above are extreme ones and probably none (or quite a few) will evolve to them. The first one will demand a powerful OCS fully integrated into the business systems, plentiful of network protocols, configurable and flexible product definition interface. The second will demand a simple traditional (legacy) charging platform.

Conclusion

The real world will lay anywhere in the space under the extremes described above.

The OCS evolution for the MNOs will be strongly tied to their evolution strategy and their place in the future of connected people, devices and things. This could lead to a deep process redesign and paradigm shift, together with the adoption of all new technological standards needed to offer all services foreseen.

For the vendors, the real risk is not to be able to design a flexible solution qualified to adapt and grow to any MNO scale and requirements. The future service differentiation should be provided by the MNO product portfolio, not by the vendor solution boundaries.

error: Copyright Sebastiao Ribeiro