A call pricing approach developed by European telecom service providers several years ago has created more than a few challenges for the industry. Standing at the top among these: Penalty charges and lost revenue. In fact, penalties can mean an increase of 3,500% over the standard termination rate.

Known as Origin Based Rating (OBR), this pricing mechanism factors in both the origination and termination of a call when calculating billing. It first appeared in Europe in 2016 following a new regulation mandating lower call termination rates within Europe. As a consequence, the operators added surcharges for call traffic originating from outside the European economic area. Previously, industry practice had long been that telecom service providers charged identical termination fees regardless of the call’s originating country. The new regulations led to European telecom carriers imposing lower fees for European calls - reflecting only the termination fee - while charging more for calls originating outside Europe. Over the years, more countries have adopted the OBR pricing model, but it remains predominantly used in Europe. 

Challenges with OBR

For telecom service providers, OBR has been a hard pill to swallow operationally due to its pricing complexities. The need to determine the destination service provider has existed for a long time in the telecom industry, but OBR brings a new set of requirements:

1. Verify if the originating telephone number is correctly formatted, i.e., it belongs to a valid, allocated numbering range and it has the correct length 
2. Determine the originating service provider in order to correctly calculate how the call should be charged

These requirements, along with related issues, have brought an added layer of difficulty in ensuring pricing accuracy. For example, the price list exchange between service providers often involves manual processes, such as sending pricing files over emails (sometimes with daily frequency), due to a lack of standardized price list formatting. This creates a greater risk of errors and introduces a new layer of fraud into the process, such as spoofing and calling line identification (CLI) refiling.

Lost Revenue and Fines Arising from OBR

For those providers having trouble meeting OBR’s requirements, hefty penalty charges can be added by the terminating network service provider if the automatic number identification (ANI) or CLI provided by the originating service provider is inaccurate. A penalty can also be charged for calls with invalid or manipulated telephone numbers.

At the same time, intermediary service providers transiting voice call traffic might get hit by serious revenue losses if their billing system does not fully implement the OBR mechanism for traffic they receive, but their downstream suppliers charge the call traffic in accordance with OBR rules. The delta between these two models can add up to very significant amounts. 

These unexpected fines and surcharges can be quite expensive – with some as high as 35 times the standard termination rate, according to industry sources. So not only are telecom services providers hit with penalty costs, but they also lose revenue if calls don’t go through due to failure to meet OBR requirements. 

A Simple Solution: Meet Carrier ID

To address these issues, telecom service providers need comprehensive and up-to-date phone number plan information and number portability data globally.

The Carrier ID service provided by netnumber GDS is a simple way to address the complex challenges raised by OBR. It includes real-time data and information about phone numbers ported in over 100 countries and territories, which means all countries where number portability is operational. In addition, Carrier ID has phone number plan data for the entire world, so it helps validate the format of originating telephone numbers. With one given phone number, Carrier ID delivers a comprehensive set of related data elements that enable users to determine the number’s properties and correctly map it to a carrier. 

Put simply; Carrier ID enables service providers to ensure they charge calls terminated on their network correctly, which maximizes revenue and helps to avoid losses. Intermediary service providers benefit from the service for the same reasons.

Another important aspect aided by Carrier ID is connection speed. Voice calls need to be connected within tens of milliseconds, so latency is critical. netnumber GDS can deploy its services in 30 regions across the globe, bringing the data milliseconds away from the service providers’ infrastructure. This ensures fast call routing and no negative impact on the end-user experience.

Learn More About netnumber GDS’s Carrier ID 

At netnumber GDS, we’ve been aligning global, robust data from more than 100 countries and territories (with code range information for the whole world) into a single easy service for more than 20 years. That means fast, reliable, simplified routing capabilities and services to help you manage OBR or any other number issue that may arise. 

Click here to learn more about our Carrier ID service, or email us at sales@netnumber.com.