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Operators Could Lose $300 Billion Per Year To Fraud & Billing Error

Mobile operators could lose a staggering quarter of their revenue - some $300 billion per year - to fraud and billing error by the time 2016 comes around.

That's the latest estimation to come out of the prediction tank at Juniper Research, via the lengthily titled ‘Mobile Revenue Assurance & Fraud Management: Business Strategies & Forecasts 2012-2016' report.

Juniper does also state that much of that loss could be mitigated, indeed reduced to more like $50 billion, by the introduction of revenue assurance, and comprehensive anti-fraud measures.

Last year, the report estimated that total operator billed revenue amounted to over $900 billion, but networks are spilling some of this cash in terms of billing issues - from calls which fall through the system and the operator doesn't charge for, to errors in customer bills.

Perhaps more worrying is the rise in fraud Juniper has observed, with high rates of SIM cloning and "interconnect bypass fraud" (avoiding call termination charges) in Africa and the Middle East. Indeed, these areas are where revenue leakage due to fraud and billing issues is at its highest level.

Juniper notes the problems can, and should, be tackled together as revenue assurance and fraud management utilise the same data.

Report co-author Dr Windsor Holden offers up the following advice to operators: "By consolidating and automating its operational processes, the MNO can establish 360 degree visibility of the complete revenue chain in order to detect hidden losses or fraudulent activity rapidly. What is required is a combination of real time analytics and proactive business intelligence."