A long way from self-service mode

Large carriers advance slowly with e-offerings Make a list of the brick-and-mortar industries at the forefront of e-business, and telecom service providers would be down at the bottom. The dream of providing voice and data customers with online purchasing, account management and support services via the Internet, it seems, still is far from reality.

"There are pockets of people in the carrier organizations that get the Internet," said Charles Gerlach, director of e-strategy in the technology, media and communications practice for Mainspring. "The challenge is once you get it, you have to deal with the legacy system integration."

The costs and labor pains in transforming operations support systems to be customer-facing are daunting and represent a major undertaking that has to occur over years, not months, Gerlach said. So while more evolved industries such as financial services move into the second and third generation of their Web efforts, telecom is just getting off the ground.

Early efforts by major carriers to put Web-based resources in the hands of customers mostly centered on small and medium-sized businesses, largely because they represent a mass market that requires cost-effective strategies for sales and customer relationship management and is therefore a good prospect for online self-service tools. But much work still needs to be done.

AT&T, for example, recently relaunched its AT&T Small Business Center site (www.att.com/smallbusiness) after studying customer usage via focus groups and tracking visitors, said Bob Sloan, marketing director for AT&T Small Business Markets.

The site's navigation and format were made simpler, as were the products and services offered, and AT&T conducted a grass roots marketing campaign to draw visitors. A "click to chat" function was added that enables telemarketing reps to query online customers in real time if they appear to have trouble finding information or making a purchase.

The changes helped AT&T double the number of unique visitors and triple the number of sales that the site generated six months ago, Sloan said, although he declined to provide specific numbers.

Via the site, small business customers can order voice and data services, view and print account payment histories, add new service lines or locations, and generate service requests. Long-distance is the most popular item purchased, and based on customer feedback, AT&T recently added a one-page "express sign-up" for buying long-distance services.

But the carrier also hopes to get online customers to bite on its All In One service bundle of local, long-distance and dial-up Internet access. On Dec. 11, AT&T launched a promotion whereby All In One customers that buy, pay their bills and are otherwise serviced entirely online receive a 1› per minute discount on service.

Increasing traffic to the site without spending millions on banner ads also is critical, so AT&T plans to introduce information services such as an 800-number lookup tool for businesses that want to check the availability of specific toll-free numbers.

WorldCom, on the other hand, is coming at e-business from the opposite direction. While its Web efforts for small businesses are still being constructed, the company offers WorldCom Interact, a high-end, subscription-based tool that enables large customers to manage their networks online. Voice and data traffic can be monitored in near real time to determine usage patterns and detect faults, and the network can be reconfigured on the fly, said Michael Tusa, executive manager of product marketing for WorldCom Interact. For example, a company with multiple call centers can dynamically reconfigure where a toll-free number terminates, allowing it to optimize call center staffing.

The system has more than 10,000 active user IDs, and 25% come in on a daily basis, Tusa said. At least half the users come into the site once a week. From this network management base, WorldCom plans to expand Interact to offer ordering, inventory management and payment capabilities, some of which are available now but are less than a year old. "We want people to get their invoices electronically and we want them to pay electronically," Tusa said.

Telecom portals also will help advance online resources for business customers, Gerlach said. That's because portals such as Simplexity.com and QuantumShift.com offer online service purchasing functions that individual carriers wouldn't be inclined to provide. For example, Simplexity's pricing engine lets users make an apples-to-apples comparison of carriers' calling plans and calculate the savings from switching service providers.

These portals don't see themselves as competing against large carriers as much as being a low-cost distribution channel for them to reach Web-savvy business customers. "Carriers see our service as an opportunity to cost-effectively trial new pricing plans and promotions without doing a large direct mail campaign," said Susan Venner, chief financial officer of Simplexity.

A carrier can provide Simplexity with real-time plan changes tailored to geography, industry, customer spending levels and service bundles to test customer response, Venner said. Simplexity charges less than the typical sales agent - about 10% of the monthly bill for the lifetime of the customer vs. the 15% to 23% charged by the typical agent. In addition, it shares general demographic information with carriers on customer buying patterns and what percentage of deals they are winning.

As the wholesale and retail models of carriers bifurcate due to the different economies required in each business, strong partners that can strengthen customer relationships via the Web will be critical, Gerlach said. "We tend to believe that intermediary players will play a more important role as an interface to services," he added.