CSPs Revenue Sharing Model for Digital Partner Settlement

CSPs Revenue Sharing Model for Digital Partner Settlement

       To stay relevant and competitive, Communications Service Providers are embracing the digital journey to evolve into Digital Service Providers. And their digital transformation journey is incomplete without their partners too joining in. Rise of inclusive technologies, business expansion dynamics and subscribers’ acceptance of new life style has created an ecosystem of network providers, content creators, smart devices and delivery partners. The partner enabled services requires Telcos to invest in next-gen partner settlement system as it involves various types of partnerships, such as:

Telco Interconnect, Roaming, SMS: Vodafone, Airtel, Uninor
OTT: Whatsapp, Facebook, Skype
Gateway / Portals: ENETS, PayPal, Pay Mate
MVNO / E: Virgin Mobile ROK Mobile, Lyca Mobile
Content Providers: On Mobile, Com Viva, IMI Mobile
ISP / MSO: Tikona, You, Sify
Channel Provider: Tata Sky, Airtel Digital TV, Dish TV

The role of partners is undeniable in terms of their reach and support and the critical role they continue to play in the business success of Telcos; however lack of capable settlement processes and systems may lead to loss of valuable partnerships – affecting service levels, revenues and margins. Thankfully, digital business support systems are not only solving the issues effectively but have made settlement almost real time or have drastically reduced it. Digital Multi-partner settlement systems are the norm today that can support most complex web of partnerships and the revenue sharing models that the service provider enters into. Let us explore different types of revenue models that the Telcos can enter into to maximize their investment from their network infrastructure, which is often utilized by such partners without them having to pay for Telco Services.

Partnership Models for a Win-Win Situation
Partnership models can vary – from number of parties involved (bi-party, multi-party), payee and receiver profiling (Customer, Operator, Partner) to sharing settlement (Percentage sharing), but one point is clear, ultimately it is the customers who are the beneficiaries through receipt of better services and they must continue to patronize such models to make it sustainable.

Legacy to digital, below are broad types under which various partnership settlements are systemised:

  1. Fixed Rate: the operator pays the Partner player a fixed rate
  2. Revenue Sharing: the Partner pays the operator a share of revenue as agreed
  3. Hybrid: the Partner pays fixed rate + shares revenue with the operator. Moreover, there are few agreements, where no one pays.

We can explore these further the next time. The second part of the blog will be published in couple of days to understand various services and their types … Stay Tuned!

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