- Dec 7, 2023
Blockchain- Rewriting The Rules of Wholesale Roaming Agreement Processes
Key pain points for the Telco Industry
Roaming and applications for wholesale roaming services are vital for operators in the telecommunication industry. Roaming is a wireless telecommunication concept that lets a mobile device connect to another available network when it operates outside of its native provider's coverage area. Indeed, the mobile device enters the coverage area again via another provider's network with which the native provider has an agreement. We can continue using our mobile phones abroad for communication thanks to roaming. Although a simple concept at a glance, current roaming practices pose considerable challenges to operators. The bilateral roaming agreement process between two operators is often conducted using manual and paper-based methods, leading to inefficiencies ranging from delays in contractual agreements to an increased dispute rate due to billing errors and discrepancies. Moreover, the lack of synchronization between the two parties and the information they exchange leads to data duplication across multiple centralized systems, potential misinterpretation of data, and an increased risk of fraud. This presents a significant roadblock to revenue recognition.[3]
Blockchain as a plausible solution for addressing the key pain points
First of all, a blockchain-based bilateral agreement process severely decreases the risk of fraud. In Latin America, fraud diminishes operators' revenue by between 5 and 25 percent.[1] Blockchain prevents this with a shared digital ledger and increased transaction transparency. The decentralized nature of the blockchain enables fast, resilient, and secured data sharing without any centralized authority (e.g., an operator or a vendor roaming hub) tasked with safeguarding the data.[2] Specifically for roaming use, blockchain technology implements roaming agreements as smart contracts which act as a bridge between VPMN and HPMN. Each transaction is then verified and secured by independent nodes. Smart contracts introduce organizational efficiency with faster verification and identification. When the roaming agreement process is initiated in the blockchain, the visited network delivers CRDs to the host network in an automated manner, allowing the host network to calculate billing conveniently and directly pay the VPMN for the service. Consequently, blockchain and smart contracts reduce costs by eliminating third parties and accurately detecting and avoiding fraud.[4]
Secondly, blockchain technology shows potential for increased integration with the 5G and IoT devices of today which demand more complicated business process automation needs to which manual and paper-based methods can’t scale. The increased complexity stems from the need for operators to sustain an ever-increasing number of roaming agreements for integration with IoT devices. There simply isn’t enough workforce capacity and resources for operators to manage their roaming operations with the current methods. Network operators build LPWANs to accommodate high demand stemming from increased connectivity with IoT devices. However, current practices to establish privacy and security are costly yet essential in LPWANs as they transact highly sensitive customer and company data. Furthermore, the massive sizes of these networks often yield complex routing processes alongside considerable management complexity resulting from the need to govern multiple system landscapes without a common platform. Blockchain can address most of these problems for IoT connectivity via its peer-to-peer networks taking over regional routing, providing higher security levels for IoT devices, and presenting a low-cost solution for SMEs.[5]
Conclusion and key business outcomes for a blockchain-based roaming process
Blockchain technology and blockchain-based processes are quickly becoming the new norm in the digital age we live in. In the telecommunication industry alone, blockchain is projected to grow to a $1B market by 2026. [6] A very prominent use case for blockchain is roaming and the bilateral roaming agreement. With the help of blockchain technology, roaming agreement processes can be digitized to deliver increased organizational efficiency alongside enhanced security and privacy, and deploy low-cost and reliable solutions to the end users. Moreover, blockchain technology enables reliability for DLT principles to provide further applications beyond roaming. It is possible to synchronize and align the network services. For instance, DLT can be used to ensure the security and quality for SLA ( Service Level Agreement) which is highly essential for crossing borders with autonomous cars. [7]
In conclusion, blockchain technology offers excellent solutions to many problems in telco industry and it also creates a new revenue stream, therefore, it is inevitable to be concentrated and monitored by international operators. therefore it is inevitable to be concentrated and monitored by international operators.
References
7. Mafakheri, Babak, et al. “Smart Contracts in the 5G Roaming Architecture: The Fusion of Blockchain With 5G Networks.” IEEE Communications Magazine, vol. 59, no. 3, Institute of Electrical and Electronics Engineers (IEEE), Mar. 2021, pp. 77–83. Crossref, https://doi.org/10.1109/mcom.001.2000857.
