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What is the level of money telecom operators are losing globally, and what is their attitude to the levels of the loss? A survey, conducted for the fifth consecutive year by Subex Azure, an OSS solutions company, that covered almost 100 operators around the world, has come up with some interesting results.

It is not just that the telecom industry is growing, and operators are making more money. In fact, they are also loosing more money. A recent global survey of telecom operators has revealed that the average revenue leakage among global telecom operators increased to 13.6% of revenue, from the 12.1% in 2006.

The reasons for operator losses are many including poor processes and procedures, poor systems integration, launching new products and pricing schemes, external fraud, internal fraud and fraud by other operators. According to the survey results, average fraud losses have grown from 2.9% of revenue last year to 4.5% this year. Interestingly, it has been observed that the mobile operators are losing more money than other types of operators. Mobile operators lost the most at nearly 14%, with mid-sized operators between 100,000 and 1 mn subscribers raking up the most loss at more than 18%. But very large mobile operators are losing only 6% of revenue per year.

Indian operators can draw their own lessons from the survey, which has also covered economies similar to that of India. For instance, operators in the Middle East/Africa region had more than 20% losses. Asia was not very far with just below 20% revenue leakage, and Central and Latin American operators were at a little more than 15%. Not surprising, but Western Europe ranked lowest in losses at about 7%, followed by Central and Eastern Europe at 8%. North America, where the pattern should not be very different from Europe, was way ahead with an average of 13% leakage.

This will surely sound like music to many ears in India, especially those who favor outsourcing. As per the survey, telecom operators who use third-party specialists for revenue assurance lose 30% less compared to those who use no external help. What was a little alarming in the survey was that the level of revenue loss that operators find 'acceptable' has risen this year to 1.8%, from 1.1% in 2006.

What was perhaps the most interesting discovery from the survey was about NGNs, otherwise touted as an approach that will reduce operators pain points. In fact, the survey reveals that revenue management challenges posed by NGN technology and applications was a key concern among almost all operators.

What does all this mean for the operators in India? Clearly all of them are in ultra-high growth mode, battling a range of simultaneous challenges. They have to add more subscribers, rollout networks in newer and far flung areas, keep announcing new services and schemes, struggle for spectrum, get in more alliances and partners, and fight dog-eat-dog competition.

Whether Indian operators go in for third party help on this or not will be their own decision, but the fact is that they will have to gear up to handle this menace. And, for Indian operators, revenue loss challenges will only increase for the next few years. For sure, new ways and means by which revenues leak, will continue to unfold. And, therefore, more senior level intervention will be required.

ibrahima@cybermedia.co.in