Along with editors from a technology telecommunications media outlet and a respected industry analyst, I recently participated in an online education roundtable on IP migration for prepaid service providers. This session was attended by approximately 100 services executives and professionals.

Many in attendance were from companies that have been in the prepaid business for five years or less; the majority were with established prepaid companies, wholesalers and Tier 1 North American carriers.  The presenters were, of course, gratified by the turnout and took the opportunity to conduct a brief poll among the attendees on their business and services goals, expansion plans and business growth projections.  Conducted by Technology Marketing Corporation, the results provide an interesting take on the prepaid industry’s direction, and can offer prepaid executives some interesting insights into their competition.

While the results of the impromptu poll should not be considered to be scientific, the answers given by those who are intimately involved in the planning, selection and administration of prepaid service systems, are, nonetheless, interesting.

The first area of focus was about the value of ongoing service tuning and control.  Attendees were asked whether the ability for a service provider to dynamically adapt and adjust services and rates themselves, in response to customer usage and market trends, would help to support higher revenues.  It should be no surprise to The Prepaid Press readers that the answer to this was 100%, yes.   Following up, we got specific about creating and inserting new call logic, specifically whether network administrators would rather use an object-oriented GUI or traditional programming language such as C++.  Over 80% of respondents said they would prefer the GUI, and it was interesting to note that the large carriers and wholesalers were among those in the GUI camp.

We then explored growth projections, asking attendees if their organizations were planning new service expansions and/or service additions over the next 24 to 36 months.  Just over 70% affirmed that such expansion was definitely in their plans. 

When asked if a possible proposed requirement for prepaid services executives to be able to readily produce proof of regulatory compliance is viewed as important to the long term stabilization of their business, approximately 57% of attendees said yes.  Predictably, the large carriers and wholesalers were most concerned about this emerging issue.  

Looking at IP migration, an overwhelming majority of the participants said they are planning to migrate their businesses:  Approximately half expect to do so in the next six months, and another 30% expect to do so within 12 months.  This majority response really isn’t all that surprising – and is probably a greater percentage than the overall population would be, because IP Migration was the subject of the forum in which the poll was conducted.

But a few surprising facts emerged in follow on questions.  Only 28% are planning migration for the primary reason of cost savings.  Other factors - including service differentiation and heightened service control – were cited by respondents as the primary reason for their IP migration plans.  Interestingly, the majority of respondents – 67% - are planning to do some or all of their own service development work, versus 33% who are planning to use customizable turnkey services, indicating that at least initially, the session’s attendees are clearly comfortable with a ‘hands on’ approach to IP service creation.  Confirming this, a slight majority said that they do not expect to ask their prepaid services vendor to provide full service integration. 

The poll was an interesting and fun exercise.  It strongly indicates that IP migration is well underway in the prepaid industry.  And although there wasn’t a poll question on this issue per se, through their attendance and participation alone, some of the larger carriers and established telecom service providers have given an early indication that they may be looking at adding additional prepaid services.  If so, new ‘front-end’ services layered onto their existing IP network and VoIP services would provide new revenues and new competition.  

We’ll conduct a similar, informal poll at the August Prepaid Press Expo in Las Vegas, and hope that you’ll stop by the Pactolus booth and participate.

Ken Osowski is the VP of Marketing & Product Management at Pactolus Communications Software. He can be reached at keno@pactolus.com.