The case for single bills: Rather than convenience, loyalty drives push for one bill

Debated among carriers, vendors and analysts, the question of whether users want a single bill boils down to this: Carriers will offer it because they believe it reduces churn-not just because users prefer to write one check a month instead of five.

In addition to convenience, the more significant reason users will want one operator for multiple services is for deals on bundled services. "A convergent market has a buyer who buys multiple services, has a preference to deal with one provider and has a propensity to take advantage of discounts," said John Hart, vice president of marketing for Saville Systems.

Some of the first customers for single bills will be the "technology-advanced family," said Bob Hritsko, market manager for Cincinnati Bell Information Services. These people are professionals with dual and high incomes who value convenience, understand the worth of their communications services and know what their bills usually total. "To them, the single bill is a matter of convenience and common sense," he said.

Many carriers believe that penny pinchers are least likely to want a single bill because they prefer to closely examine each bill and may suffer from sticker shock when receiving one large bill. These subscribers, however, may be swayed to use the same carrier for multiple services and possibly opt for a single bill.

Hart used his grandmother as an example. She closely reviews each bill and oftenfinds them too expensive. "If someone explained to her that now her three bills that total $60 will only be $55," she might consider using multiple services from one company and receive a single bill, he said.

Some carriers offer bundles on a limited basis now. AT&T offers 30 minutes of residential long-distance free per month for 12 months to customers who sign up for wireless service.

Regarding business customers, a recent Strategis Group study shows that they are interested in bundled services for the convenience of dealing with one source for customer service and that discounts encourage users to choose multiple services. In companies with more than 50 employees, 58% said they wanted bundles. That number increased to 69% if customers could receive a 10% discount on services.

Operators believe that offering these bundles will reduce churn.

"The subscriber that has leveraged a provider for multiple services is a more loyal user," said Harold Zeitz, vice president of consumer marketing for AT&T Wireless Services. "By the time you get your whole communications needs involved with a company, you're more tightly linked."

Carriers that offer single bills do so on a varying degree. Some offer one bill without converging their billing system on the back end, which means that customer service representatives waste time learning and using multiple interfaces.

In addition to making CSRs more efficient, a converged billing system such as Saville's allows CSRs to access information about customers' account activities on multiple services, not just the service the customer has called about. This can be valuable for CSRs to determine special deals.

Billing systems converged on the back end also can be adapted faster. Saville's system is table-driven, allowing operators to respond quickly to market changes, Hart said.

Single bills can be tricky when credit risks use them, however. Therefore, Ameritech checks customers' credit history before allowing them to receive a single bill. "If someone is an inconsistent payer, it can be difficult to do receivables," said Michael Battisto, market manager for Ameritech.

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