As more and more businesses move to the cloud, cloud billing is also poised to grow due to its role as a key enabler for recurring revenue and subscription and consumption-based usage models. According to a recent study by analyst firm MarketsandMarkets, the cloud billing market is estimated to grow to $16.59 billion by 2021. Aria Systems picked up on the study an released its list of top cloud billing industry trends to watch for in 2018:
Billing becomes more complex as consumption-based models grow and customer choice reigns
The increase in highly-tailored services and products — like the “per-second” service pricing introduced by AWS last year — will make the billing process more intricate than ever. New regulations in Europe and other countries will add new privacy rules into billing, further complicating workflows. End-customers will still demand ease-of-use and an intuitive experience, so billing models need to adapt to meet these expectations while handling increased complexity on the back end.
Everything as a Service expands
In the software industry, Gartner predicts that more than 80 percent of software vendors will change their business model from traditional license and maintenance to subscription by 2020. Technology solutions are leading the charge, but more traditional products also are moving into the service economy. Even the modern workspace is being sold as a service through industry disruptors like WeWork and PeerSpace. This year more industries from manufacturing to transportation will continue to be tested as a service, whether their markets are ready or not.
The telco industry continues to disrupt itself
The telco industry rarely had to worry about customer service back when it had few competitors, but the landscape has completely changed. They’re now in direct competition with OTT service providers that are siphoning off traditional TV subscribers and producing and distributing their own content without cutting in MSOs. The telco industry can no longer sustain growth just by providing the pipelines for distributing content – they now must become digital service providers (DSPs) to remain competitive and support the next generation of digital services. In addition to becoming DSPs, telcos must also provide customer experiences on par with their born-digital rivals. This means reinventing their antiquated back-end infrastructure, including billing systems, to deliver the services needed to lead in the 21st century.
Cloud billing becomes a strategic competitive advantage
While buyers will continue to demand choice and flexibility, sellers will increasingly deliver varied payment models and plans as a way to differentiate their offerings. Successful companies will leverage cloud billing to retain customers longer and increase profitability. As such, companies will reap the benefits of repeat customers and a continuous revenue stream.
Tom Dibble, President and CEO of Aria Systems noted, “These trends indicate that, for enterprise companies to remain relevant and meet the new demands of digital-age consumers, they need to update their backend operations and embrace billing as a strategic differentiator for their recurring revenue business models.”