Tier 2 Cable Billing Platform Plays Key Role in M2M Arena

Jim Dunlap, president, Cycle30

Jim Dunlap, president, Cycle30

July 18, 2012 – In an intriguing sign that second as well as top tier cable operators have a shot at the machine-to-machine services market a leading M2M systems aggregator has tapped a cable company’s back-office platform to serve clients’ billing requirements.
Denver-based Arrow Electronics, one of the world’s largest distributors of chips and other components, is touting Alaska MSO GCI’s Cycle30 billing service subsidiary as the sole back-office system supplier for its customers in the M2M space. It happens that the comprehensive suite of out-sourced capabilities Cyber30 has devised for its Tier 2 cable customers positions Cycle30 to support the complex requirements of the M2M marketplace as well, says David West, vice president of supplier marketing and asset management at Arrow..

“With the Cycle30 platform, Arrow can enhance our M2M and cloud services market business with new products and flexible service models by providing billing solutions for our clients,” West says. Arrow’s customers in the Americas have access to Cycle30’s hosted order-to-cash platform for ordering, mediation, rating and billing services, he notes.

Cycle30 is well prepared for the M2M billing space, having moved into the outsourced cable billing business in response to demand from Tier 2 operators for a cloud-based solution that could accommodate the full scope of quadruple play consumer and commercial services as well as wholesale opportunities. “When I was at GCI as CIO we were at between 40,000 and 50,000 wireless subscribers, and we needed to move to a hosted billing model,” says Jim Dunlap, president of Cycle30. “When we couldn’t find what we wanted we decided to create it ourselves.”

As experts with cable backgrounds, Dunlap and his team were able to create a platform tuned to the needs of cable companies at the two million subscriber level and below, down to about 50,000 subs, that were too small for the Tier 1 billing providers but whose needs were too complex for billing systems traditionally molded to smaller operators’ needs. “We understand SOC (Service Organization Control) compliance, lifeline audits, PCI (Payment Card Industry) payments, CPNI (Customer Proprietary Network Information), all the regulatory issue – all the things you have to do as an operator,” Dunlap says. “We bring that perspective to the table.”

The Tier 2 market is hot for a billing services supplier who can address the service complexities these operators are dealing with, he notes. “We see companies aggressively repositioning themselves with the ability to get services to market fast,” he says. “They’re offering complex service packages bundled with the Internet, including commercial services, which have become the growth engine.”

GCI, which Cycle30 now supports, is a case in point with big corporate customers in its territories including Wells Fargo and British Petroleum. The infrastructure Cycle30 has built to support these kinds of operations is ideal for the M2M market, Dunlap notes.

“Our customers don’t have to grind capital building data centers,” he says. “We source all our systems in the SunGard data center outside Denver and in Arizona, and we also use data centers around the world to support testing and training. If a cable company wants to launch a test we bring it up in the cloud, where they can work on development and training prior to launch. We’re a full outsource IT shop.”

Recently Cycle30 launched billing support for iPhone service bundled with GCI’s Internet and cable TV, he notes. “It’s fully integrated with Apple’s back end, which was no small feat. GCI is one of the first Tier 2s to launch iPhone service.”

Cycle30 has invested over $1 million to expand its platform to accommodate all of Arrow’s needs, Dunlap says. “Arrow is an amazing company,” he says. “They’re the second largest distributor of chips in the world but they’re not very well known.

“A couple of years ago they started working with a supplier of electronic parking meters. They watched the whole life cycle and recognized their chip was just a tiny piece of what was required with all the functions that go into transactions with coins and credit cards, storage of data, etc. Arrow looked at this and realized that with 150,000 commercial customers all over the world they could really help people speed the development cycle by bringing everything together for M2M applications.”

Cycle30 executives have been traveling with Arrow’s people as they present M2M seminars across the country. “It’s been an eye opener to see all the kinds of applications emerging in this space,” Dunlap says. “Just in energy along there are all sorts of solutions in play – the smart grid stuff, security monitoring on the industrial side of energy, managing drilling rigs and pump stations.

“You have all the well-known things like home health care, home security, etc. and a bunch of crazy new ideas as well – facial recognition technology, lighting security for the skiing industry where they’ve been losing lights to theft, devices for vehicles with 17 year-old-drivers to signal when they’re misbehaving behind the wheel.”

With M2M headed to saturation levels of traffic volume, the backhaul opportunity for cable and wireline carriers is enormous, he adds. Eventually there may be a play over Wi-Fi on the access side as well, although the industry has a long way to go with infrastructure deployments and network integration to become a significant player in M2M access.

Alluding to how partnerships are the new story in M2M, Dunlap says Cycle30 is set up to support whatever Arrow brings to the table. “Arrow has the heft to bring integrated solutions involving a wide range of partners, where the settlements can get pretty complex,” he says. “We’re seeing partnerships emerge that bring in small rural cell carriers to serve the needs of energy suppliers. We’re seeing router arrangements with multiple carriers. No matter which model they pick, we’re able to support it.”

As enterprises come to grips with what they need to exploit the power of intelligent device connectivity, there’s an obvious opportunity for network service providers who can offer a back-office framework that is sufficiently all-encompassing and flexible to satisfy virtually any business model. Judging by Cycle30’s ability to bridge the back-office needs of Tier 2 NSPs and users of M2M technology, it doesn’t look like the opportunity is limited to the Tier 1 NSPs.