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A Flexible Charging & Billing Approach for the Emerging UMTS Network Operator Role Vangelis Gazis1

Maria Koutsopoulou1

Charalampos Farmakis

Alexandros Kaloxylos1

Communication Networks Laboratory Department of Informatics University of Athens 15784 Athens, Greece [email protected]


Hypermedia and Digital Libraries Laboratory Department of Informatics University of Athens 15784 Athens, Greece [email protected]


Keywords: Mobile, 3G networks, charging, billing, UMTS. Abstract Future mobile telecommunication systems heralded as 3G and 4G are expected to trigger significant changes in the market for telecommunication services, by facilitating the participation of various market players in the overall service provision process. Consequently, such systems will have to satisfy the diverse technical requirements that result from the increased dynamics in the business relationship domain. In the present paper, we introduce a business model for the emerging mobile telecommunication market and propose a novel charging and billing approach, which can exploit preferential membership relationships, and satisfies the requirements of the respective market players. Moreover, we illustrate the application of our approach over a typical UMTS network infrastructure.

INTRODUCTION In traditional mobile telecommunication environments, service access and service provision has been statically bundled together in various subscription-based offerings by incumbent telecommunications operators. Voice telephony and SMS are well known examples of such services in 2nd generation (2G) mobile telecommunication systems. The major cause underlying these inflexible service offerings has been the vertical design of these systems, which were engineered and implemented in a highly optimized manner for the provision of a single service: voice telephony. Consequently, 2G systems possess limited expandability potential and present significant obstacles in introducing new services, unless these are directly related to voice telephony, e.g. supplementary services. Introducing radically different services incurs high costs, because the vertical design of the system and all respective intelligent components renders modifications and upgrades complex as 11

This work was partially supported by the IST project MOBIVAS (WWW page: http://mobivas.cnl.di.uoa.gr/). The content of this paper expresses solely the opinions of the authors.

well as expensive. Given the high initial investments required in deploying 2G systems, it is no surprise that the respective service offerings have focused on preventing subscriber churn in an attempt to maximize revenue streams. As a result, services offered by 2G operators are inherently limited to the sphere of voice telephony and related services for which a flat rate pricing model, i.e. monthly subscription fees, combined with time dependent charging, i.e. duration of call, was sufficient to address the respective business requirements. The introduction of 3rd generation systems such as UMTS departs from 2G practices by adopting a number of significant design principles. First and foremost, UMTS provides for complete independence between the network domain (access and transport) and the service domain (application/service and content) that has fostered the tremendous Internet growth over the last decade [1]. To this end, UMTS specifications do not define services, but service capabilities [2]. In recognition of the importance of the Internet domain and the inherent limitations of 2G systems, UMTS follows a horizontal architecture that focuses greatly on the specification of a flexible and efficient transport mechanism for the IP protocol [3] [4] [5]. Last but not least, it provides for a complete separation of the radio access and core network domains, by specifying a clear and precise demarcation for the respective communication protocols, thus ensuring the independent evolution of each [6] [7]. Market projections suggest that in a mature 3G market, the major revenue source for telecommunications operators will originate from packet-based value-added services provided by independent value-added service providers, rather than traditional voice telephony. In the new market era, incumbent telecommunication operators, who typically maintain monolithic billing systems, are faced with the challenge of upgrading their systems to support complex

market strategies for both their business to consumer and business to business activities. The rest of this paper is organized as follows: First we outline the fundamental business issues in future 3G markets. Then we present a business model for the provision of value-added services to 3G mobile users. We proceed to elaborate on the principal charging issues in the 3G marketplace and to propose a novel charging approach that meets the respective business requirements. Further on, we demonstrate the application of the proposed schemes over an enhanced UMTS network architecture. Finally, we conclude with an illustration of the developed simulation model and related message sequence charts.

BUSINESS ASPECTS OF 3G MARKETS The aforementioned architectural principles sketch a 3G telecommunication market that differs significantly from its 2G predecessor in the following areas: Business roles In 2G systems, the incumbent mobile network operator acted as an access network (e.g. GSM) provider and the – exclusive – service (e.g. voice telephony) provider. Participation of other players in the market was virtually non existent. However, in 3G systems, the mobile network operator will inherently bear only the access network (e.g. UMTS) operator role – the service provider role may be readily undertaken by market players other than the mobile network operator [8] [9]. Market competition Unobtrusive and competition neutral regulation, as well as the horizontal architecture of 3G systems, lowers market entry barriers for a number of players other than the mobile network operator [10]. These players will typically come in the form of value-added service providers, application providers, content providers and content aggregators, to name but a few. Each of these players will contribute additional value to the overall service provision in 3G systems and will compete with the rest for a portion of the user revenue. Changes in the value chain 2G systems focused on voice-related communication service offerings to the mass consumer market segment for person-to-person communication, e.g. conversation, where the exchanged content, e.g. voice, was of little or no value to anyone but the talking parties. However, the participation of application providers and content providers in the 3G service provision process implies the attribution of a portion of revenue to applications and content and the need to provide efficient and flexible billing and accounting mechanisms. In fact, application and content will both form determinant factors in building diversified 3G service offerings and will,

therefore, constitute a significant portion of the overall revenue [10] [11]. This situation, when combined with the user preference for flat rate access and the declining trend in the price of bandwidth, underlines a paradigm shift in the value chain from 2G to 3G (Figure 1): 2G

Terminal Terminal

Access Access

Transport Transport

Service Service

Content Content

Service Service

Content Content

3G

Terminal Terminal

Access Access

Transport Transport

Figure 1. Value chain changes between 2G and 3G. In such a highly competitive marketplace, the ability to take up new business opportunities via value-adding partnerships will constitute an important strategic advantage for 3G mobile network operators. Consequently, the viability of such partnerships will greatly depend on the availability and efficiency of flexible charging, billing and accounting approaches [11]. In the following, we present an attractive business model for the future 3G market and elaborate on the roles undertaken by the participating players.

BUSINESS MODEL The typical mobile network operator possesses significant strategic advantages in the emerging 3G market. In addition to a large subscriber base, it maintains the customer relationship and thus presents a form of “gatekeeper” for application and content providers seeking to position themselves in the 3G market. Furthermore, the 3G network infrastructure provides integrated robust authentication mechanisms and rigid security features that establish an important level of trust between the 3G mobile network operator and its subscribers. On the other hand, application and content providers control the resources that can contribute greatly to increased revenues and business profitability. To elevate the overall level of trust between the involved parties and to facilitate the integration of applicable charging schemes with the typical credit benefits of modern mass consumer markets, we introduce a third trust entity in the business model. The third trusted entity is responsible of communicating whatever economic consumer privileges the subscriber enjoys to the 3G charging process [12]. Furthermore, the third trusted party can contribute its authentication and authorization mechanisms during the endto-end service consumption phase. Therefore, we propose a 3-tier business model that capitalizes on the unique value-adding features of each player (Figure 2):

Third Third Trusted Trusted Party Party

1..*

1..* Subscription and portal access rights

1..*

1..*

Business level relationship for VAS provision

1..*

User

1..*

UMTS network operator

Value added service provider Content Content Provider Provider

User User

1

1..*

1

1..*

Subscriber Subscriber

1..* 1..*

Access Access Provider Provider

1..* 1..*

Service Service Provider Provider

0..* 1..* Transport Transport Provider Provider

0..*

The “composite” roles as defined in the proposed business model The “fundamental” roles as defined in the UMTS framework

Figure 2. The proposed business model for 3G value-added service provision. In the aforementioned business model, the 3G mobile network operator undertakes the following roles: A business entity that controls the Access provider: access network infrastructure and engages in procedures pertaining to access authorization and transparent exchange of IP packets over the wireless transmission medium and up to a fixed network access point. Within the scope of UMTS, the access provider administers the access and core network domains of a UMTS network infrastructure. We note that, due to the clear separation between the access network and core network domains prescribed in the UMTS specifications [6] [7], the access provider role may be further decomposed in a UMTS radio access provider role and a UMTS core provider role. However, such business combinations are not examined in the present paper. The access provider negotiates business level agreements with transport providers as well as other access providers, e.g. to accommodate roaming users. Transport provider: A business entity that controls a network infrastructure that provides transparent forwarding of IP packets between fixed network access points to the adjacent infrastructure of other transport or access providers. Examples of such roles are AT&T, MCI, etc. Transport providers regularly form business level agreements with access providers and other transport providers. The entity termed value-added service provider may undertake any combination of the following roles: A business entity that controls the Service provider: computational infrastructure directly employed in the process of realizing applications and services. Examples of such services include VoIP and electronic wallet services. Service providers may form business level agreements with content providers and other service providers. Content provider: A business entity that owns and controls the generation and distribution of content, e.g. text, audio, video. Examples include media and news distribution

agencies. Content providers typically negotiate business level agreements with service providers. In the proposed business model, several roles have been aggregated on the same market player, in an attempt to depict the most probable business combinations of early 3G markets. Two relationships dominate the aforementioned business model: a) The business-to-business relationship between the 3G mobile network operator and the value-added service provider, through which the latter negotiates the provision details for its applications and services. b) The business-to-consumer relationship between the 3G mobile network operator and its subscribers that deals primarily with authentication, authorization and roaming issues. We note that a direct relationship between the user and the value-added service provider is not precluded – just beyond the scope of the present paper. Therefore, the detailed interactions between the user and the service are not analyzed here. We note, however, that the presence of the security association relationship with the third trusted party facilitates the reuse of the public key authentication and authorization mechanisms in the direct interaction between the user and the value-added service. These features could simplify the verification of the user’s membership privileges – in case that is required by the functionality of a specific value-added service. The high deployment costs of 3G systems impose an exigent need to accelerate system take up in order to minimize payback periods. Therefore, 3G systems should provide the ambient intelligence and the respective mechanisms that will facilitate seamless and ubiquitous discovery of value-added services by the users. Service discovery To support the realization of these mechanisms within the scope of the aforementioned business relationships, we supplement the standard UMTS infrastructure with an intelligent broker component, termed Service Manager (SM) that provides a registrar for value-added services [13] [14]. The SM lies within the administrative domain of the 3G mobile network operator, which announces its existence to its subscribers, possibly as a parameter of the subscription details. The SM exports operational interfaces toward the involved players: a) The value-added service provider: For the dynamic registration, update and de-registration of value-added services with the SM registrar. b) The subscriber/user: To support the submission of queries as well as browsing for value-added services in the SM registrar.

CHARGING FOR VALUE-ADDED SERVICES

Resource Resource usage usage records records for for the the access access layer layer

Resource Resource usage usage records records for for the the transport transport layer layer

Resource Resource usage usage records records for for the the service service layer layer

Resource Resource usage usage records records for for the the content content layer layer

Access Access layer layer metering metering model model

Transport Transport layer layer metering metering model model

Service Service layer layer metering metering model model

Content Content layer layer metering metering model model

Inter Inter layer layer communication communication to to support support model model choice choice decisions decisions (business (business logic logic and and criteria) criteria) Pricing Pricing Tariffing Tariffing

Access Access layer layer pricing pricing and and tariffing tariffing model model

Transport Transport layer layer pricing pricing and and tariffing tariffing model model

Service Service layer layer pricing pricing and and tariffing tariffing model model

Content Content layer layer pricing pricing and and tariffing tariffing model model

Inter Inter layer layer communication communication to to support support model model choice choice decisions decisions (business (business logic logic and and criteria) criteria) Accounting Accounting Billing Billing

A flexible charging and billing approach Within the context of charging for telecommunication services, the following definitions apply: a) Metering is the process of recording resource usage levels and formatting of the respective values into finite record sets [15] [16]. b) Tariffing is the process that provides the tariffs for a given finite set of resource usage records, e.g. price per MB, price per QoS level, etc. c) Pricing is the process that determines the appropriate combination of tariffing models for a given finite set of resource usage records, e.g. volume-based or flat rate. d) Billing is the process that operates on the output of the pricing and tariffing to produce subscriber bills. e) Accounting is the process that apportions charges and revenue between the roles in the corresponding business model. Overall charges for services provided – in the context of the proposed business model – will be aggregate charges, comprising the following constituents: • Access charges • Transport charges • Service charges • Content charges The proposed architecture follows a layered approach (Figure 3) that preserves the underlying value chain

Metering Metering

The engagement of value-added service providers in the service provision process mandates that service revenue should be apportioned between them and the 3G mobile network operator. However, typical accounting procedures pose significant restraints and fail to provide the flexibility required by the dynamic introduction of value-added services. Furthermore, the packet-based transport mechanism of 3G systems multiplies the amount of volume data that must be processed by the charging and billing system by at least an order of magnitude [10]. On the other hand, the potential of acquiring detailed per-packet charging information streamlines with the accrual basis of accounting mandated by modern business and management practices and facilitates the design of flexible architectures – a key advantage in the 3G market [11]. Therefore, we believe that 3G charging and billing architectures should be designed with a complete and precise separation of the constituent charges incurred by players of each domain that are engaged in the overall service provision. We further propose that these architectures should exploit to the full any potential for detailed charging information that the network infrastructure possesses. In the following section we elaborate on the proposed charging and billing approach.

demarcation throughout all the stages over which the charging process manifests itself:

Access Access layer layer accounting accounting and and billing billing model model

Transport Transport layer layer accounting accounting and and billing billing model model

Service Service layer layer accounting accounting and and billing billing model model

Content Content layer layer accounting accounting and and billing billing model model

Inter Inter layer layer communication communication to to support support model model choice choice decisions decisions (business (business logic logic and and criteria) criteria)

Figure 3. The layered charging approach and the stages of the overall charging process. a) Metering stage: The metering stage concerns the collection of resource usage sets for all the domains in the value chain. Table 1 illustrates typical resource usage parameter sets for each value chain domain: Table 1. Examples of resource usage metrics for each domain in the value chain. Domain

Resource usage parameters

Access

Location, terminal identity, user identity, etc.

Transport

QoS, volume, time, origination host, destination host, etc.

Service

Transport protocol, source port number, destination port number, etc.

Content

Session protocol, content type, coding scheme, etc.

b) Pricing and tariffing stage: Provides the selection of the appropriate pricing model and the population of the respective tariffing models with their values, while taking into account any membership-based economic privileges of the user – as communicated from the third trusted party and depicted in the respective pricing and tariffing models. c) Billing and accounting stage: Builds on the output of the pricing and tariffing stage to produce itemized user bills and to split revenue between the market players contributing to the service provision. The staged approach allows us to decouple the distinct aspects of the overall process. The glue that binds these stages together is the business logic and criteria that are embedded in a “vertical” back-plane layer, which connects

to all the “horizontal” stages. At each stage, the back-plane layer determines the appropriate model from a database with applicable models and triggers its instantiation along with the population its of values in the respective block. In the following section we present an enhanced UMTS architecture suitable for the provision of value-added service to mobile users that supports the application of our layered charging model.

standardized parameters that are included in the CDR format on a separate basis for uplink and downlink traffic: Table 2. Parameters recorded in the Call Detail Records generated by the UMTS network components. Parameter name Served IMSI 3

CHARGING, ACCOUNTING AND BILLING IN A 3G NETWORK ARCHITECTURE 3G billing approaches should take advantage of the established customer care relationship between the subscriber and the 3G mobile network operator. Ideally, the user should still receive a single itemized bill for all consumed services regardless of the providing party – a feature known as “one stop billing”. Therefore – and within the context of the aforementioned business model – we propose the realization of the charging, accounting and billing (CAB) system within the administrative domain of the 3G mobile network operator. The UMTS operator domain in the proposed business model

Service provider domain

Typical UMTS operator domain

Transport domain

Access domain

Service domain

SM

UTRAN

SGSN

L4+

GGSN

UMTS core network Hiperlan

SGSN

UMTS operator core network

GGSN

L4+ CDR

CAB

VASDR

Content layer charging Service layer charging Transport layer charging Access layer charging

Figure 4. The proposed enhanced UMTS network architecture. Figure 4 illustrates a possible enhanced UMTS network architecture that includes a centralized implementation of the CAB system. The latter performs the actual post-processing of the resource usage records generated by metering devices embedded in appropriate network components, thus facilitating the described charging process. The standard UMTS network components, i.e. SGSN and GGSN, record various resource usage parameters, which are formatted in Call Detail Records (CDRs) by means of the CGF2 [15] process are delivered to the billing system of the 3G mobile network operator. Table 2 presents the Charging Gateway Function.

The subscriber’s unique identity

APN

The external network identifier

IP Address

The IP address of the mobile terminal

Location

Location area, routing area or cell identity.

Data volumes

List of user traffic data volumes, categorized per QoS negotiated and received, tariff change and the corresponding timestamps

Apparently, UMTS specifications [15] define protocols that deal primarily with access and transport domain charges – charging for services or content has not been addressed yet. To provide the resource usage records for these domains, we supplement the typical UMTS network infrastructure with layer 4+ routers (L4+) appropriately positioned at the interconnection points to other adjacent networks (Figure 4). The term “layer 4+” stems from the router’s ability to examine the TCP/UDP payload of transit IP packets [17]. As a result, besides typical network and transport layer information, e.g. source/destination IP addresses, port and protocol numbers, the layer 4+ routers are capable of identifying HTTP or RTP payloads and extrapolating the content type on the basis of MIME information. In addition, the layer 4+ routers are DiffServ [18] capable, thus recording the DiffServ code point [19] values and the respective service classes of transit IP packets. The availability of QoS information for both the transport and access domains facilitates the application of pricing and tariffing models that take into consideration the QoS requested, negotiated and received. Table 3 presents the parameters that are included in the Value-added Service Detail Records (VASDRs) generated by the layer 4+ routers on a separate basis for each direction of transit traffic: Table 3. Parameters recorded in the Value-added Service Detail Records by the layer 4+ routers. Parameter name Src IP address 3

2

Description

Description The source IP address

The Access Point Name is a reference to the external network with which the mobile terminal exchanges IP packets.

Dst IP address

The destination IP address

Protocol number

The transport protocol number

Src port number

The source port number

Dst port number

The destination port number

DS code point

The DiffServ Code Point value

Data volumes

List of traffic data volumes and corresponding timestamps

The CAB system correlates these two kinds of resource usage records during the billing stage process. The configuration of the layer 4+ routers with regard to the monitored IP traffic flows is controlled by the SM component, as part of the value-added service registration, update and de-registration procedures. Likewise, it is during these procedures that the SM coordinates the activation of the appropriate pricing and tariffing models for the valueadded services in the CAB system.

SIMULATION MODEL The CAB system, which has been fully developed in an SDL model and contains the charging, billing and accounting processes, realizes the last two stages of the overall charging process. The first stage, i.e. the metering stage, is realized in a distributed fashion by metering processes [15] that run in appropriate network nodes, i.e. SGSN, GGSN and layer 4+ routers. The charging process receives the resource usage records, i.e. CDRs and VASDRs, from the aforementioned network components. After processing these records, the charging process triggers: a) The billing process, which selects and instantiates the appropriate pricing and tariffing models from the CAB internal database. b) The accounting process, which activates the appropriate accounting model in order to apportion revenue between the contributing players. Figure 5 illustrates the calculation of charges attributable to the consumption of 3G network operator resources, i.e. access and transport domain charges, while Figure 6 illustrates the CAB internal process logic for charges attributable to the consumption of value-added service provider resources, i.e. service and content domain charges. In order to produce an itemized bill for all consumed services, the charging process must correlate the various resource usage records and determine the IMSI key – the mobile subscriber’s unique identifier. Currently, correlation of the resource usage records for the access and transport domains (CDRs) with the ones for the service and content domains (VASDRs) takes places on the basis of the mobile

terminal’s IP address, while other alternatives remain under investigation.

CGF CGF

Charging Charging

Billing Billing

CDRs CDR processing Store the combination: (IMSI, user IP address) Produce transport billing record) TRANSPORT_BILLING_RECORD

Find tariffing and pricing models Calculate charge Store the record TRANSPORT _BILLING_RECORD_RESPONSE

Figure 5. Calculation of access and transport domain charges. Layer Layer 4+ 4+

Charging Charging

Accounting Accounting

Billing Billing

VASDRs Find IMSI Produce billing record for service/content SERVICE_BILLING_RECORD

Find service tariffing and pricing model Calculate the charge Store the record SERVICE_BILLING_RECORD_RESPONSE ACCOUNTING_RECORD

Find service tariffing and pricing model Calculate the charge Store the record ACCOUNTING_RECORD_RESPONSE

VASDRs_resp

Figure 6. Calculation of service and content domain charges.

CONCLUSIONS AND FUTURE WORK In the present paper, the fundamental characteristics of the future 3G market were identified and their significant effects on business roles if the 3G era were recognized and analyzed. Furthermore, we proposed an appropriate business model for the emerging 3G mobile network operator role, which we complemented with a flexible charging approach that fulfills the respective business requirements. The overall charging process has been specified in SDL and extensively simulated in Telelogic SDT. Possible extensions of the work presented here include the further decomposition and analysis of business models in order to comprehend the novel dynamics of the 3G value chain and to architect network infrastructures that provide efficient and viable solutions to these issues.

REFERENCES [1] 3G TS 22.101: "3rd Generation Partnership Project; Technical Specification Group Services and Systems Aspects; Services Principles (3G TS 22.101 version 3.12.0)". [2] 3G TS 22.105: "3rd Generation Partnership Project; Technical Specification Group Services and Systems Aspects; Services and Service Capabilities (3G TS 22.105 version 3.10.0)". [3] 3G TS 23.002: "3rd Generation Partnership Project; Technical Specification Group Services and Systems Aspects; Network architecture (3G TS 23.002 version 3.2.0)". [4] 3G TS 22.060: "3rd Generation Partnership Project; Technical Specification Group Services and System Aspects; General Packet Radio Service (GPRS); Service description; Stage 1 (3G TS 22.060 version 3.5.0)". [5] 3G TS 23.060: "3rd Generation Partnership Project; Technical Specification Group Services and System Aspects; General Packet Radio Service (GPRS); Service description; Stage 2 (3G TS 23.060 version 3.5.0)". [6] 3G TS 25.410: "3rd Generation Partnership Project; Technical Specification Group Radio Access Network; UTRAN Iu Interface: General Aspects and Principles (3G TS 25.410 version 3.3.0)". [7] 3G TR 23.930: "3rd Generation Partnership Project; Technical Specification Group Services and Systems Aspects; Iu Principles (3G TR 23.930 version 1.0.0)". [8] Report #8, UMTS Forum, http://www.umts-forum.org/. [9] Report #9, UMTS Forum, http://www.umts-forum.org/. [10] Report #10, UMTS Forum, http://www.umts-forum.org/. [11] Report #11, UMTS Forum, http://www.umts-forum.org/. [12] C. Farmakis et al., “A flexible membership/subscription handling system in an e-commerce environment”, 2000 Americas Conference on Information Systems, California, USA, August 2000. [13] N. Alonistioti et al., “An application platform for downloadable VASs provision to mobile users”, IST Mobile Communications Summit 2000, Galway, Ireland, October 2000, pp. 309-314. [14] N. Housos et al., “A VHE architecture for advanced valueadded service provision in 3rd generation mobile communication networks”, Globecom 2000, San Francisco, USA, November 2000. [15] 3G TS 22.115: "3rd Generation Partnership Project; Technical Specification Group Services and System Aspects; Service aspects; Charging and Billing (3G TS 22.115 version 3.2.0)". [16] Ipmeter White Paper, 2000, http://www.ipmeter.com/ [17] Layer 4 Switching: An overview, http://www.enterasys.com/technologies/smartswitch-router/ [18] RFC 2475, “An Architecture for Differentiated Services”, http://www.ietf.org/rfc/rfc2474.txt [19] RFC 2474, “Definition of the Differentiated Services Field (DS Field) in the IPv4 and IPv6 Headers”, http://www.ietf.org/rfc/rfc2474.txt