Roaming – Its About Reconciliation/Settlement – Part 1

Implications: The telecom business operates in a series of rapid cycles. As an issue, roaming alternates between being an issue and not being an issue – and that is such a mistake.

Analysis: As long as we have had cellular, roaming has been an issue.  It will always be an issue.  Roaming is not just about access charges.  Roaming is about revenue reconciliation.

Roaming will need to include new wireless technology-based carriers.  The addition of Internet-based carriers has added a level of complexity that roaming service companies of the 1990s and early 2000s may not be able to deal with.  Despite the re-emergence of the super carrier, there are still dozens upon dozens of smaller carriers and service providers.  Today we see a plethora of wireless local area network providers and Internet service providers and all are interconnected with the larger carriers. 

Mobile Virtual Network Operators (MVNOs) will require roaming services as well.  Despite the fact that MVNOs operate on particular individual carrier networks, the MVNOs need to be accessible from other networks.  The MVNO will need to be accessible everywhere for the paying consumer.

Femtocell deployment will usher in a new era of wireless providers.  These providers could be landlords or corporations serving their own employees’ needs.

There are the old timers like Syniverse (the old GTE TSI) and Verisign but then again there are newbies like Mach.  Investors need to take a very close look at Mach.  Mach has not been burdened with legacy systems or legacy customer needs.  Mach is the result of a merger between IBM/TDC created Dan.net and the old Mach.  Impressive lineage.

Now here is the kicker.  In 2007, Cibernet merged with Mach.  Now that is an impressive lineage.  Remember Cibernet?  These are the guys who helped (along with dozens of industry professionals and telecom companies) write the roaming reconciliation rules.

The protocol developed was called CIBER and the function known as CIBER Roaming Settlement System (also known as financial clearing and settlement) was developed and provided as a service to the members of CTIA by the CTIA.  Cibernet was CTIA’s roaming settlement arm.  Cibernet was used by CTIA members who could not afford their own reconciliation systems or vendors. Twenty years ago there were many, many more small cellular carriers than there are today.

People like to credit GTE and Cibernet (which was a part of the Cellular Telecommunications Industry Association) alone but a large number of professionals were involved.

Bottom line, Cibernet (and its allies) created the CIBER protocol.  CIBER stands for Cellular Intercarrier Billing Exchange Roamer.  We used to call it the CIBER record.  CIBER is a roaming message exchange record.  At divestiture in 1984, wireless carriers owned by Regional Bell Operating Companies (RBOCs) were enjoined from using any of the landline standards, so the wireless industry created its own standards.  Now Mach owns Cibernet.

Put two and two together.

The point I am making; Mach may be able to go toe-to-toe with Syniverse and Verisign in its own backyard.

The technology component of seamless roaming was solved over a decade and a half ago.  The issue is not technology but financial.  Roaming is about money.  The proliferation of wireless service providers and hot spot providers will require a powerful settlement system.

Roaming, reconciliation, and settlement – its all about making money.