How the broadband of the future will be billed

Two concepts hold the key to this new charging and billing environment, Bartram said. The first is convergence, which focuses on the consolidation of pre- and post-paid billing. These formerly siloed processes are becoming more integrated, allowing greater flexibility in how customers consume and pay for bandwidth and content. The other key concept is real time, which moves billing from a batched process to something that is much more focused on what a customer is doing over time.

The end result is that customers will become more active in choosing — and understanding — how they consume and are charged for bandwidth. “There will be some customers that feel nickel-and-dimed,” Bartram said, especially those who were used to consuming huge amounts of bandwidth with no consequence. “But the question is: Are those high-value customers you really want and need to do something about?”

In the end, the key for operators is to understand that the future of broadband billing is less about billing at all — and more about pricing and new service creation and merchandising.

“What we're talking about instead is using pricing as an alternative to throttling, using it as a way to try to influence and control customer behavior,” said David McNierney, vice president of business development for pricing and rating vendor HighDeal. “[Service providers] need to empower front-office people — product managers and marketing teams — to price and package services to meet not one but two objectives: to maximize revenue, yes, but also to minimize the impact on the network. Typically carriers have learned to put blinders on because their billing systems were so inflexible.”

Greater billing flexibility undoubtedly will result in a variety of approaches to how service providers charge for bandwidth. And examples don't need to just come from telecom. Hollywood, for example, is big on using promotions and loyalty programs to drive sampling and manage demand. Power utilities, meanwhile, have been leaders in managing consumption, in some regions even experimenting with in-home “orbs” that let customers know when the power grid is overtaxed — via red, green and yellow glows. “If it's red, then maybe it's not the best time to do the laundry,” said McNierney.