Billing System on 1oT Terminal: A Step-By-Step Guide

During the years of licensing out our Connectivity Management Platform 1oT Terminal, we have established that a good billing system is a key component of a successful IoT business line – it allows MNOs to charge their IoT clients for services and products, and helps to keep track of how much money their clients are spending on these services. This information can be used to optimize the way in which MNOs deliver their services and products, thereby increasing revenue and reducing costs.

We have seen that billing is often one of the daily challenges the MNOs are facing. The problem lies in the fact that MNOs are required to use different platforms depending on the type of client they are serving. For example, if an MNO uses a third-party analytics tool, they need to use an external platform rather than using their own. This can be very time-consuming and costly; so much so that MNOs may end up making errors in their invoice reporting.

This is why it's so important for MNOs to have a solution in place that can help them streamline their billing process for IoT/M2M customers.

In this blog post, we’ll walk you through the billing process of 1oT Terminal, and how it works on the licensed platform.

The logic behind the system

In order to understand the inner mechanisms of the 1oT Terminal’s billing system, it is important to know where the data that it’s based on, comes from. 

The information for 1oT Terminal’s billing system comes from two main sources: Data packages (also known as product or rate plans) and Call Detail Records (CDRs).

Data Packages

Data packages are the core element of a billing cycle. There, the pricing for all SIMs is defined, helping the billing system to differentiate between customers and their expenses. According to that logic, each SIM card is attached to a data package and monthly final invoices are generated based on the data usage of these individual SIMs.

1oT Terminal’s billing system allows to create of a variety of different data packages, depending on the preference and use case of the end-user. The package’s pricing, data commitments, and the number of SIMs included in the package can always be changed by the company administrators on the go, depending on your customers’ needs.

You will be able to specify:

• Amount of data (MBs) that can be used per SIM;
• SMS limit per SIM;
• Which countries SIM can roam in;
• Which networks does SIM have access to.

1oT Terminal offers two different options for data package billing: a pay-as-you-go model and “pooled” packages.

Pay-as-you-go model: 

Besides the base fee, the client pays for the consumed data (MB) and SMS’, as specified in the pricing list in the country of deployment.

This is a good solution for users whose:

• devices are moving between countries within one month;
• data consumption varies a lot from month to month;
• devices don’t yet have the country of deployment decided.

Included (“pooled”) package:

In this package, the client commits to consuming a certain amount of data in a selected number of countries. The important part of it is that the data commitment can be pooled over multiple SIMs.

To understand the logic behind it, let’s imagine a client with two SIMs, 1 using an average of 40MB per month, and the other one 50MB. Now in case these SIMs were to consume more or less than predicted, these SIMs could be pooled into one 100MB package, so the customer wouldn’t have to pay for any extra data for these SIMs.

With both billing options, it is possible to give discounts for base fees, data, and SMS commitments, also on a country level.

Call Detail Records (CDRs)

However, the data usage history of SIMs comes from a different source – this data is fetched from CDRs. The CDRs display every session that has taken place with each SIM. Then, that information is used to calculate the cost of SIM cards in data packages at the end of each billing cycle.

The information collected about each SIM:

Invoices

Invoice generation is the final and often considered the most important component of any billing system. At 1oT, all invoices are automatically generated once a month based on all billable actions and data usage of the customers’ SIM cards.

In order to simplify managing and analyzing the customers’ invoices for MNOs, 1oT has built a dedicated Revenue Assurance system into the Terminal.

It essentially comes down to two sections:

• Invoice management - Allows MNOs to see and edit the invoice amounts and keep track of the rendered services used, and adjust and discount line items.
• Invoice analysis - Helps to identify and pinpoint the anomalies in the customers’ invoices, such as unusually small/large total amounts, and unexpected data usage.

The invoices can have two statuses:

• “Prepared” - All fields have been prepared and filled out on the 1oT side, and the invoice is ready to be reviewed.
• “Sent” - Invoices have been compiled, confirmed, and forwarded to the MNO’s accounting department. The report will be sent to the MNO’s accounting software in a machine-readable format.

We understand that sometimes certain corrections are needed in the invoices, thus our billing system supports the most common adjustments. 

As so, you can either debit or credit an invoice line item, depending if there are additional charges or deductions, such as one-off discounts, needed.

Additionally, you can add a custom field in the invoice, usually used for showcasing Purchase Order data in the invoice.

Customer-facing side

Currently, making sure that the correct invoice reaches the customer is managed by the MNOs themselves in order to keep the operations running smoothly internally and in sync with their operational software.

Nevertheless, the flow follows a simple pattern: once a month, 1oT generates a billing invoice report and forwards it to the MNO in a format of their choice. Then, the final invoice is compiled, reviewed, and sent to the MNO’s customer.

The MNO's end-customers have an option to choose between two different payment methods: the traditional post-payment model, or paying in advance.

The prepayment feature allows the customers to simply transfer money to their Terminal account beforehand, and the correct amount is automatically deducted from the account's credit balance whenever there is a billable event.

Furthermore, leveraging prepayment gives the customer a better overview of their monthly expenses because the customer is responsible for setting the credit cap. This acts as a great protection against additional charges that might occur if an IoT device malfunctions and consumes a large amount of data, or sends thousands of SMS messages in a short period of time.

All in all, 1oT has made the billing process as simple as possible for the MNOs that have licensed our Connectivity Management Platform to implement for their own IoT business line.