The next-generation CM&B systems allow the provider to link subscribers, services, and money in real time in order to identify and take advantage of new IP–based business opportunities proactively while providing superior customer service. For example, one large telecommunications company had purchased a site license to use a batch billing system for its telecom business. The Internet division of this company was also covered under the site license. However, the company determined that a batch system was inadequate to meet the real time nature of the Internet and instead chose to invest in a real time billing system.

A trend that is having a major impact on providers and the evolution of CM&B is the move from flat-rate billing to usage-based IP services. Rather than bill subscribers a flat fee for services, providers are billing customers based on their service usage—megabytes of disk space or e-mail messages sent, for instance. With usage-based billing, subscribers are more likely to request their account balance in real time rather than wait for the next bill to be generated.

Because many subscriber accounts will be created on-line, the billing system must be able to support prepaid, credit-card, and debit models and provide subscribers with accurate, instant access to current usage data and account balances. The CM&B system's account management functions must include the capability to monitor balances, detect when a subscriber has exceeded the credit limit, and take the appropriate business action.

For instance, the provider can instantly send subscribers e-mail notification or instant messages informing them that their credit threshold has been reached. The subscriber may then be offered an option to purchase additional services. The provider may also decide to extend additional credit or to interrupt or block certain services in real time. All of these examples require complex, real time CM&B systems, as back-office legacy billing systems are unequipped to handle the fast-paced world of IP.

Providers are also conscious of managing customer service costs. According to a Forrester report entitled Telecom Self-Service Debuts, a single customer service call costs a provider $8. Reducing call volume by providing subscribers with the ability to make real time changes to their own accounts results in a substantial cost savings to the provider.

Scalability is a concern for many providers as their businesses expand. The billing system must scale to support the Internet service provider (ISP). Given the rapid growth of the Internet, providers must be confident that their systems will scale to meet the increased demand for services. The billing system must also be extensible so that it can integrate with general ledger systems, customer care applications, legacy billing systems, and other applications that the provider is using. Real time CM&B systems are able to accommodate legacy batch processes for those applications where time is not a factor and a batch mode is more cost-effective. The reverse is not true—batch systems cannot accommodate processes that must be performed in real time.