ROI: 71%

Payback: 1.41 years

THE COMPANY

With almost 35 years of experience and approximately 1.4 million subscribers, Casema is one of the Netherlands’ leading cable operators. Via its modern fiber-optic network, Casema offers a wide range of electronic services and products including radio, television, digital TV, Internet, Internet television, voice over IP (VoIP), and data communication. Casema’s network is located mainly in the central and southwestern parts of the Netherlands. Casema is active in such cities as The Hague, Utrecht, Amersfoort, Delft, Leiden, and Breda.

THE CHALLENGE

During the last several years, the Dutch telecommunications market has been deregulated and a monopolistic environment has been replaced by one with approximately six competitors including Casema. In mid-2004, Casema wanted to expand its product offering and improve its customer retention by introducing a bundled offering that would include not only cable television and Internet, but also VOIP telephony. Bundling several telecommunications services together in one
offering is an important way for providers to improve their profitability and strategic position. Customers who buy bundled products are more loyal and less likely to change providers.


Casema had been using the Comverse Kenan billing solution since 1997 and recently upgraded the software in preparation of introducing the bundled offering of video, Internet and VoIP services. In selecting a solution that would enable this introduction, Casema was leaning towards Comverse for several reasons:

• The solutions required minimal customization.
• Deployments had been trouble-free.
• Upgrades had been simple.

Additionally, because the Comverse product suite is modular, Casema had been able to avoid buying functionality it did not require. In fact, Comverse offered a solution suitable to enable VoIP, which is far more usage driven than other communication products.

Because of its prior success with Comverse solutions, Casema was leaning toward using Comverse’s Kenan Data Mediation solution, which was designed for usage billing, and therefore appropriate for VoIP.

THE STRATEGY

In mid-2004, Casema sought out solutions that could enable billing for VoIP and found that only Comverse and Oracle were in the market. Casema decided to purchase Kenan Data Mediation because it is pre-integrated with the Kenan billing solution Casema was using, and because the Oracle solution did not have strong usage billing capabilities.

Casema began deploying Comverse Data Mediation in August 2004. For several weeks, managers from the accounts receivable and billing departments worked with developers to determine the functional requirements of the solution. Three developers then configured the solution. The system was deployed in January 2005 after two months of testing by four members of the IT team.

After deploying the solution, Casema began offering VoIP services to its customers, and now bundles it in with its basic consumer offering. Casema has 30,000 customers who buy VoIP alone, and 30,000 who purchase Casema’s “triple play” offering which bundles Internet, VoIP, and cable television together. The billing department relies on the Comverse solution to bill all services, including the growing base of VoIP customers.

KEY BENEFIT AREAS

Adopting Data Mediation has enabled Casema to both increase its product offering and reduce customer turnover. Key benefits from the solution include:

• Reduced customer turnover. Casema has added VoIP to its product offering both as part of a bundled offering and as a stand-alone product. Approximately 20 percent of the customer base purchases the company’s “triple play” product bundle that includes cable television, Internet, and VoIP. As a result of this bundling, these customers are less likely to switch to rivals offering VoIP, and turnover for this type of customer has reduced. With this reduction in customer churn, profits have increased.
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• Improved product offering. The company now has a new initiative to increase revenues by expanding the product offering. Billing for video on demand, variable bandwidth Internet, and mobile VoIP is as complex as billing for voice over IP, and Casema can now consider offering these products because it is running both the Comverse billing solution along with Data Mediation.
  

KEY COST AREAS

Key cost areas for the deployment included personnel, hardware, software and consulting. Personnel consisted primarily of deployment efforts and ongoing support of the solution. Consulting and software costs consisted of the purchase of Kenan software licenses and maintenance, as well as assistance provided by Comverse during the deployment. Hardware consisted of servers for storage of billing data. The total cost of a deployment of this type can vary widely, and will depend on the size of the deployment, its complexity, and the degree of integration involved.

LESSONS LEARNED

Casema’s deployment of Kenan Data Mediation was both rapid and relatively problem-free. Casema indicated that the following success factors played a role:

• Simplicity. From the outset, everyone involved in the deployment strived to deploy and integrate Data Mediation with minimal customizations. This both minimized costs and accelerated deployment.
• Sponsorship. Because the deployment was part of a major strategic initiative, it was supported by a strong steering committee that included members of Casema’s board of directors. This board had regular input on the project and had as one of its priorities simplicity of deployment.
• Collaboration. The deployment team included professionals from Casema with expertise in CRM and billing, as well as Comverse professionals with extensive knowledge of the Comverse solutions. The team collaborated well and communicated directly on a regular basis.

CALCULATING THE ROI

Nucleus calculated the costs of personnel, hardware, software, and consulting over a 3-year period to quantify Casema’s total investment in Comverse’s Data Mediation solution.

Benefits were all direct and consisted of increased profits arising from Casema’s introduction of its “triple play” product — a bundled consumer offering including cable television, Internet access, and VoIP for one monthly fee — which enabled the company to reduce churn in its customer base.