Although mobile data traffic continues to grow at a very rapid pace, mobile service providers are challenged with significantly lower growth rates in data revenues, and they have now realized that relying primarily on data connectivity services to drive future revenue growth is an unsustainable strategy in the long term. Meanwhile, popular applications provided by the major Internet players (often referred to as “Over the Top” or OTT players) currently bypass the service provider value chain, leaving them mostly with the role of providing network connectivity and Internet access. For this reason, service providers are now seeking new, innovative ways to monetize their core network assets and capabilities, creating a shift in the service market dynamics.This objective generally drives their initial strategy, which is to publish their core services as APIs in order to attract developers to create new applications and services that utilize service provider capabilities such as communications, context and payment. Their initial strategy can be characterized as “build and they will come”. They believe that abstracting their services and publishing easy to use APIs is sufficient to generate initial interest and business opportunities.
Consequently, the initial tactic for most operators in their strategy is to expose their basic services with simple APIs. They develop or identify an appropriate web portal to expose these service APIs for the application developers’ consumption.
This generally works well and is relatively painless when they expose one or two APIs. However, scaling beyond just a few APIs will require additional integration and management resources. Some providers continue on this path, and realize that they will end up necessitating unplanned and costly professional service resources to properly integrate and operate efficiently.
However, based on our customers’ experience, we know that this approach is limited and service providers inevitably need to think through developing a long-term strategy that will empower them to sustain their growth. In order to maintain control and flexibility, service providers also need to look at product-based solutions, rather than custom development. This generally motivates them to look for products that enable them to create their own offerings and will not require a large investment in external resources to manage the process.
Aepona’s API Monetization Platform (AMP) enables service providers to quickly and efficiently develop compelling new API services and Mashups that create utility for the developer and differentiates them from their competitors. These services can integrate Network API services such as messaging, payment, location and call control, with external Web and Enterprise APIs.
But what about making money?
Generally, with their initial deployment of API services, operators begin to see some success and some traffic to their portal. The initial exposure begins to attract developers, which in turn draws some attention from their product management team. At this point, the product management team begins to look into not only how to expose their service APIs but also how to make money from their published APIs.
Service Providers want to have the ability to monetize the use of their network assets in multiple ways, which will vary according to the type of API, and the type of application or partner consuming the API. They therefore need to be able to support multiple business models simultaneously, such as per-transaction charging, subscription-based charging, volume-based charging, zero-rating for certain types of API in return for revenue share, sponsor-funded models, and so on. They then need to be able to automatically settle with each partner, according to the SLA that applies to each partner application. The settlement process needs to take account of the money owed to the partner (e.g. for Direct to Bill / Payment API transactions), and the money owed by the partner to the service provider (for API consumption). Because of the potentially high numbers of partners, applications and business models involved, this process needs to be automated and integrated with the operators’ BSS/OSS systems.
The Aepona Payments and Settlement Engine, a component of AMP, provides the full set of capabilities to meet the Service Provider needs outlined above. It provides flexible developer charging mechanisms, real-time event capture, automated multi-party settlement and integrated customer consent management, itself a critical requirement for a commercial API service.
Managing the multitude of developers and partners
The next challenge for service providers is to expand their strategy to a multi-developer and multi-channel operation. When the process grows to managing many APIs and attracting a large group of application developers and customers, service providers will require more resources to manage and create new APIs, to establish agreements with developers, to support the services and to manage the volume of transactions and maintain appropriate service levels.
This is the stage where service providers have a full-scale operation with multiple developers and need to establish contracts, service level agreements, onboarding procedures, custom requests and many other processes. In order to ensure successful and efficient growth, it is crucial for them to have a comprehensive partner management strategy.
Aepona’s AMP includes a Partner Management Engine that permits the integration with existing business processes and CRM systems and manages service level agreements and partner contracts. This component enables fast developer provisioning and low touch partner management.
The Aepona API Monetization Platform enables the service provider to implement a comprehensive Network as a Service business model through exposing, managing and monetizing its core network assets to external partners as easy APIs, in order to expand its channels to market and generate new revenue streams. Aepona offers a complete partner management solution that seamlessly integrates and manages multiple partners, contractual agreements and a variety of service level options.