Convergys lands Leap, picks up VeriSign scraps

In an oddly announced and carefully worded deal, Convergys today won Leap Wireless’s next-generation billing business while also inking a “transition” services contract to help the wireless operator – as well as a handful of additional customers – phase out their current implementations of VeriSign’s BSS platform.

The press release was played mainly as a contract win for Convergys, which will provide its Active Mediation and Rating and Billing Manager products to Leap, which provides flat-rate, unlimited mobile services under the Cricket service name. Leap formally signed a multi-year management services deal with Convergys for the implementation and ongoing management of those new systems. Deal terms were not disclosed.

To facilitate that expected multi-year billing systems transition, Leap needed help maintaining and moving off of its old system, which was provided by VeriSign (which originally acquired the wireless billing system from HO Systems back in 2002). VeriSign has been backing out of the telecom business for some time, announcing plans to divest businesses outside of its core Internet domain and security markets back in late 2007. Along with HO Systems, VeriSign had made a handful of telecom-related deals, acquiring signaling vendor Illuminet plus other vendors such as M-Cube, LightSurf and Jamba. Last year, a number of VeriSign executives spun out the company’s telecom analytics products to form a new company called Globys.

“VeriSign has had trouble unloading its telecom assets,” said IDC analyst Elisabeth Rainge. “Taking care of its existing billing customers is an important step for VeriSign. But making this sort of arrangement suggests that the business was not even in a strong enough position to be sold in a formal way. Convergys is probably the only billing vendor who didn't walk away from the VeriSign customer base.”

Convergys has divestiture plans of its own. Back in September, the vendor announced it was considering spinning off its Information Management Group (which includes its billing assets) from its customer care/CRM business. It has not made any announcements since then, however.

The Leap/VeriSign deal was carefully worded and, according to the press release, comes in three parts. First, Leap purchased VeriSign’s billing system and software. Second, Leap entered a “transition services agreement” with Convergys for billing services using the VeriSign system until the new Convergys system is in place. Finally, Convergys acquired VeriSign’s relationships with other customers utilizing VeriSign’s billing system. A VeriSign spokesperson confirmed that the deal represents VeriSign’s exit from the carrier billing market but had no further comment.