SMSC White Paper

Prepaid Billing System

For SMS
Confidential

CMG

The information in this document is subject to change without notice and should not be construed as a commitment by CMG.
CMG assumes no responsibility for any errors that may appear in this document.
The information given in this document is strictly confidential.

2000 CMG Telecommunications

Version History

Version

Date

Details of Changes

Author(s)

0.1

10-APR-2000

Initial version

Sander Brouwer

1.0

03-MAY-2000

After review by sales dept.

Sander Brouwer

Approval Record

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SMS prepaid billing system

Date

Approved by

Signature

Steven van Zanen

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Table of contents

Introduction .......................................................................................................3

Positioning of CMG's prepaid SMS solution ..................................................4

2.1
2.1.1
2.1.2
2.2
2.3
2.4
2.4.1
2.4.2
2.4.3
2.4.4
2.4.5
2.4.6
2.4.7
2.4.8
2.4.9
2.5
2.6
2.7

Existing prepaid SMS solutions............................................................................................4

Processing CDR's / HLR blocking........................................................................................4
Prepaid credit checking at SCP by MSC..............................................................................4
Problems when interfacing to existing prepaid billing systems ............................................4
CMG's solution: Prepaid Billing System for SMS .................................................................6
Prepaid Billing System for SMS Features ............................................................................6
Real time charging and blocking ..........................................................................................6
Recipient charging ...............................................................................................................6
Allow blocked prepaid subscribers to send free SMS to certain Large Accounts ................6
Mixed post-paid and pre-paid on one system ......................................................................6
Support for distributed SMSC's ............................................................................................6
Hybrid charging support .......................................................................................................7
Possible refund in case of non delivered message..............................................................7
Differentiated charging .........................................................................................................7
Other advantages.................................................................................................................7
Scalability .............................................................................................................................7
Redundancy .........................................................................................................................8
Capacity ...............................................................................................................................9

Integration in network.....................................................................................10
3.1.1 Administrating prepaid SMS users.....................................................................................10
3.1.2 Integration with IVR system ...............................................................................................10
3.1.3 Integration using Recharge Application .............................................................................11

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Introduction

This paper gives a description of CMG's solution for charging prepaid SMS.
Operators and suppliers of Prepaid systems have had much difficulty with the
implementation of the SMS in their Prepaid solutions. Operators require to charge
Prepaid SMS as real time as possible to prevent fraud.
SMS for Prepaid has boosted at those operators who were able to offer SMS in
Prepaid to their users. Forecasts for Prepaid show an enormous increase in the
next few years. It is expected that Prepaid users will represent a substantial part of
the operator subscriber base and of its revenue.
It has already been proven that Prepaid users use SMS more than Post-paid users.
Therefore the prepaid charging solution shall be capable of charging high volumes
of Short Messages on a real time basis. Furthermore CMG's prepaid charging
solution shall be capable of keeping pace with the continuously growing
performance of CMG's SMSC.

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Positioning of CMG's prepaid SMS solution

2.1 Existing prepaid SMS solutions

2.1.1 Processing CDR's / HLR blocking
In Post-paid situations, SMSs are normally charged overnight. In the case of
Prepaid, this is also possible (usually in combination with HLR blocking) but it does
not fulfil operator requirements. The problem is that charging overnight leads to a
fraud window. Furthermore, Prepaid users can make an account enquiry and hear
the wrong amount.
2.1.2 Prepaid credit checking at SCP by MSC
Another solution for prepaid SMS that some operators have implemented is based
on an interface between the MSC and the SCP. For every SMS originated by a
prepaid mobile, a check is done at the SCP by the MSC. If the credit of the
subscriber is sufficient, the message is forwarded to the SMSC. A number of
problems exist with this solution:
The first problem is that roaming is not supported (foreign MSC's do not check the
SCP for subscriber credit). This means that prepaid messages sent outside the
own network cannot be charged.
The second problem is that mobile originated SMS can be charged only at a flat
rate, since vital information such as the recipient address is not known at the MSC,
i.e. differentiated charging is not possible. Charging mobile terminated messages
(in case of messages sent by Large Accounts) is not possible.
The third problem is that only mobile originated SMS are charged at submission,
and no refund is possible in case the message cannot be delivered.

2.2 Problems when interfacing to existing prepaid billing systems

To resolve the problems illustrated in the previous section, a real prepaid SMS
charging should be based on the SMSC. This section describes the issues that
would arise when an SMSC would be connected directly to an existing Prepaid
Billing System.
The majority of prepaid billing systems in use with operators are IN based. The IN
architecture provides in an Service Control Point (SCP), a Service Data Point (SDP)
and a provisioning interface.
The SDP contains all the prepaid subscriber accounts and has two interfaces:

The SCP. The SCP handles normally call set-ups and call breakdowns initiated
by the MSC and is typically capable of handling ca 120 transactions per
second.

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The provisioning interface. This interface is used for recharging the prepaid
account of the subscriber usually via an Interactive Voice Response system
(IVR) and is typically capable of handling ca 1 transaction per second.

For real time charging, SMS's need to be charged at the same time that the short
message is submitted. With the current volume and growth of SMS usage (500
submissions/sec), the available interfaces are a problem:

Provisioning interfaces are not built for high speed debiting of a prepaid
account. Most provisioning interfaces are capable of handing only one
transaction per second. With the current SMS traffic and the current
percentage of prepaid subscribers, this will lead to fraud windows of multiple
days.

SCP interfaces. An operator would have to approximately double his SCP

capacity to enable charging of prepaid SMS with the current SMS traffic. As
SMS traffic would grow, also the SCP capacity would have to grow accordingly.
If the operator would be too late with increasing the SCP capacity, the available
SCP capacity would be monopolised by SMS charging, leaving no capacity for
voice call charging. Since enlarging SCP capacity is a very costly affair to
operators, this is not a very tempting scenario.

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2.3 CMG's solution: Prepaid Billing System for SMS

As described above, charging SMS making use of the existing network components
is not an option. SMS is a business in itself, therefore separate provisions need to
be taken to charge prepaid SMS. Note that a separate prepaid Billing System for
SMS also implies separate budgets for the end user for voice and SMS.
CMG's SMS Prepaid Billing System is closely linked to CMG's SMSC. Therefore
blocking a prepaid user from using SMS when he is out of credit is done on the
SMSC itself. More features can be found in the following sections.

2.4 Prepaid Billing System for SMS Features

2.4.1 Real time charging and blocking
For every prepaid short message accepted by the SMSC, the cost of that short
message is calculated and the prepaid account is decremented with the calculated
cost. When the prepaid SMS account is zero, the prepaid subscriber will be blocked
on the SMSC platform. Note that in blocked state, the prepaid subscriber is still
capable of receiving and sending messages if these messages are not to be
charged to his prepaid SMS account.
2.4.2 Recipient charging
For a mobile to mobile message normally the originator of a short message is
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charged . However, when a message is sent by an Information Provider providing
valuable content a message should be charged to the prepaid account of the
recipient. CMG's Prepaid SMS solution supports this on a per Large Account basis.
2.4.3 Allow blocked prepaid subscribers to send free SMS to certain Large
Accounts
The operator is capable of configuring a Large Account to accept free messages.
When a subscriber is blocked, he is still capable of submitting short messages to
these free Large Accounts.
2.4.4 Mixed post-paid and pre-paid on one system
Both post paid and prepaid subscribers can be handled on the same SMSC. Postpaid subscribers are normally charged using the CDR's and are outside scope of
the SMS prepaid Billing System.
2.4.5 Support for distributed SMSC's
The SMS Prepaid Billing System is designed to work in a network where one or
more SMSCs are involved, thus ensuring optimal return on investment for the
operator.

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The system can also be configured that the recipient is charged for a mobile to mobile message. This can be the case in
countries that have recipient charging as a rule (e.g. the United States)

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2.4.6 Hybrid charging support

Networks that have prepaid SMS charging enabled using MSC / SCP solution in
the own network (described in section 2.1.2), have trouble charging an SMS when it
is sent from outside the own network. CMG's solution can in these cases be used
to charge only those messages that were originated outside the own network thus
preventing double charging the prepaid subscriber.
2.4.7 Possible refund in case of non delivered message
The operator can configure whether non-delivered messages involving a prepaid
subscriber shall be charged to the prepaid subscriber. In case non delivered
messages should not be charged, the SMSC can be configured to refund the SMS
credit for the non delivered message.

2.4.8 Differentiated charging

Differentiated charging is enabled by providing the operator with a configurable
service logic. The service logic defines an unambiguous rule to calculate the price
of a prepaid short message based on the following parameters:
1. Recipient address. It shall be possible to define a charging rule based on the
type of address (PID, NPI), the prefix of the recipient address as well as on the
complete recipient address as it was entered by the MO user.
2. Originator address. It shall be possible to define a charging rule based on the
type of address (PID, NPI), prefix of the originator address as well as on the
complete originator address of the MO user.
3. Time of day and days in week (e.g. off peek tariffs after 18:00 hours and on
Saturdays and Sundays)
4. A certain predefined period between two specified dates (e.g. reduced tariff as
an introduction offer by the operator)

2.4.9 Other advantages

The system can send a warning message to the subscriber in case the
prepaid subscriber is nearly blocked. The system can also send a notification
message in case the prepaid subscriber has been blocked.

There is no need for changes in the SS7 network.

There is no influence on (the performance of) the HLR, because blocking of

prepaid subscribers is done on the SMSC.

The solution works while roaming, without the need for IN or CAMEL features.
Independent via which MSC the message enters the system, the message
can be charged.

2.5 Scalability
The prepaid billing system for SMS has a scalable architecture. The storage of
prepaid accounts is distributed over multiple parallel processes each having their
own shadowed disks.
Because of this scalability, the SMS prepaid billing system can run on a multi-node
environment, providing full loadsharing. Therefore it can be guaranteed that the

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SMS Prepaid Billing System will keep up with the performance of CMG's SMSC as
it increases.

2.6 Redundancy
As stated above, the storage of prepaid accounts is distributed over multiple
parallel processes each having their own shadowed disks.
If a process holding the prepaid account of a certain subscriber range is not
available, e.g. in case of a node failure, failover is provided by one of the remaining
processes which will store the incoming debits until the original process is available
again.

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2.7 Capacity
The SMS-PBS is capable of storing account information for a subscriber range upto
20 million subscribers, i.e. the system can be deployed in networks upto 20 million
subscribers.
In large networks the SMS-PBS has to run on separate multinode hardware. In
medium and small networks the SMS-PBS shall be combined on the backend
nodes of the SMSC system (single node, dual node and quad node). The SMSPBS can also be combined on a tri node HPS system. A few modifications to the
hardware are required to the hardware. A.o. the amount of memory (1 GB) and the
amount of disks need to be increased.

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Integration in network

3.1.1 Administrating prepaid SMS users

In order to utilise CMG's prepaid billing solution, prepaid users using SMS have to
be registered on the SMSC. The most optimal procedure of administrating the
prepaid SMS users is the following:
1. Initially the ability to send SMS for a prepaid user is blocked in the HLR
2. If the user wants to start using SMS, he calls the operator's IVR number and
selects a menu item indicating that he wants to use SMS and wants to reserve
credit for this.
3. The IVR system initiates 2 commands:

The ability to send SMS for a prepaid user is enabled in the HLR by the
IVR system.

The prepaid user is administrated on the SMS-PBS/SMSC and credit is

moved to his SMS account in the SMS-PBS

From this moment on the user is capable of sending MO-SMS.

3.1.2 Integration with IVR system

The operator's IVR system will have to be adjusted such that an IVR menu item
becomes available to recharge SMS credit. When the end-user selects this menu
item, a remote command is executed on the SMS-PBS which adds a specified
amount of credit to a specified MSISDN

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IVR

Message
Suvmission

PBS 1

Recharge SMS credit

PBS 2

SMSC1

SMS PBS

Wide
Area
Network

Message
delivery

PBS 3

PBS 4

3.1.3 Integration using Recharge Application

As an alternative to integration with the operator's IVR system, CMG can deliver an
application which can move credit from the PBS to the SMS-PBS and vice versa.
When the prepaid user is blocked, he is still capable of sending messages to a
predefined operator application. On receipt of a mobile originated short message
the recharge application will move a requested amount of credit to the originator's
SMS account. Other commands the Recharge Application supports include
querying the SMS account and unloading credit from the SMS account back to the
voice account.
CMG will offer a documented interface for the integration of the Recharge
Application into the Prepaid Billing Systems.

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