NCR fights churn, Internet-style: System borrows from telephony world to help build ISP profitability

A new decision support solution from NCR will leverage the company's expertise in data warehousing and retail support to give Internet service providers a tool to fight churn.

The system, SmartEC Decisions, is designed to help ISPs, on-line content providers and application hosting providers increase customer retention, market share and profits.

"While voice carriers are struggling to prevent customer attrition, the problem is much worse for ISPs," said Paul O'Brien, vice president for the communications industry business unit of Dayton, Ohio-based NCR. "People are shopping around, going from one service provider to the next, trying on different service providers, and every switch by a customer means lost revenue. At the same time, the ISPs are struggling to change the pricing paradigm. Obviously, something has to change."

To address the problem, SmartEC Decisions correlates Internet activity data with business operational information and external reference material.

This allows ISPs to view the critical aspects of their businesses and focus on service portfolio revenue trends, contributions and preferences by customer segment, and performance of hosted content and applications.

This knowledge can then be used to manage service portfolios, targeted marketing campaigns and tiered pricing.

"The Internet is a wonderful customer care mechanism, but it's very difficult for service providers to get a good feel for how individual customers are using their services," O'Brien said. "The SmartEC system allows providers to figure out which customers are the most profitable and thus most important to retain."

With Internet-based telephony and faxing, electronic commerce and other services emerging as attractive services that help boost ISPs' revenues, ensuring that the right customers are retained and included in marketing efforts will become even more critical, O'Brien said.

The system allows ISPs with specific and quantifiable business problems to analyze, filter and apply data to help address those issues. The solution uses the NCR Data Mart data warehousing system as a foundation, allowing ISPs to store, organize and manage information such as Internet access logs and Web server activity logs.

A set of business solution models provides 40 report templates to give a quick look at frequently studied data. The modular design of these models also allows ISPs with unique problems to easily develop their own report formats.

"The system pulls data from Internet transactions [similar to the data that] operations support systems provide voice carriers in the traditional telecom world," O'Brien said. "As in the systems we build for telcos, the SmartEC Decisions system does data extraction, data transformation and data cleansing."

In many cases, ISPs can generate this data far more quickly because "most ISPs don't have a spider web of confused legacy systems to deal with yet," O'Brien said.

SmartEC Decisions also includes professional services and hardware additions to provide the plumbing between systems, he said.

Although the solution is fully customizable, NCR offers a starter package that lets customers begin implementation rapidly and expand the solution over time.

"This is a very logical step for the ISP market," said Brian Murphy, a director at The Yankee Group. "NCR is taking a lot of the ideas that they've been selling in the telephony market and giving them an Internet-based spin. The two markets have more similarities than differences when it comes to customer care and retention, so that approach makes sense."

Segments the most valuable customers based on cost of acquisition, spending patterns, interests and preferences, and susceptibility to churn

Identifies the most profitable services and profiles the subscribers who use them

Discovers traffic patterns to help ISPs understand which users use which resources

Assesses effectiveness of on-line content

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