CSPs get an edge with DLT-enabled data management

March 12, 2020 Blog No Comments »

New challenges to the telco business model

Globally, communication service providers have been increasingly facing multiple challenges to their traditional business models. From the growing costs for infrastructure and data management to increased scrutiny from the public and the authorities — all of them call for a new robust blueprint of handling both user personal and operational data. Before we look at ways of how leveraging the distributed ledger technology can tackle them, let’s further explore some of those major pain points.

  • Compliance with data privacy regulation.

Due to growing awareness from the public and stricter regulatory controls over user privacy rights, telcos now choose to use personal data only after having obtained explicit consent from their subscribers.

Yet, with the amount of advanced data analytics backed by centralized massive big data infrastructures, the reality is that the subscribers are not always clearly informed of the scope of the insights extracted by CSPs from consented data.

To stay compliant in this complex environment, telcos need a more transparent data management vehicle to be able to track user personal data and provide detailed reports on its use when requested to do so — either by users, or regulators.

  • Subscription identity fraud.

The cost of fraud in the telecom sector amounts to USD 38 billion annually.

With multiple ways in which a subscriber’s identity can be compromised (email phishing, SIM cloning, etc.), the most common instance is subscription fraud when using a fake ID to get access to SIM cards and mobile services. Most telecom providers maintain their own fraud databases to identify potential fraud activities, but current solutions are either not effective (e.g., a CSP asks customers to create passcode while creating a wireless account), or expensive (e.g., stand-alone ID protection systems such as Equifax). Due to the multiple-play services provided by telecom operators, ID-theft can result in compounded losses through access to many services under a stolen identity.

  • Managing user identities.

Currently, every time a user needs to sign up, they are prompted to prove their identity and credentials using physical or digital documents even though most of the information would not be needed by every vendor, which leads to an array of challenges such as lack of convenience (many username/ password combinations) and security (personal data shared with third parties).

Harness the power of DLT to reduce the overheads and create new revenue streams

Inherent in blockchains, cryptography can be used quite broadly to tackle the concerns of both user-sensitive data mismanagement (by hashing each transaction to the immutable ledger to make every instance of sharing trackable) and fraudulent IDs (by broadcasting the phone-generated public key instead of broadcasting the IMSI to the network). By adopting a data collection system run on the blockchain ledger, a telco service provider will benefit by:

  • Forming a new relationship with its subscriber where the subscriber feels better served.
  • Reducing the fraud levels by rolling out virtual identities with digital signatures and private keys: a private key associated with this identity is stored safely on the eSIM; then a pointer to this virtual identity is added to the blockchain.
  • Drawing newer revenues from transaction fees charged to customers of insight information in the marketplace.
Virtual Identity Use Case

Taraxa offers DLT-enabled solutions for implementing data governance strategies for CSPs that are robust and easy to onboard.

  1. Be in control of all your operational data:
  • Establish an immutable record of data events and transactions.
  • Become better informed about user preferences, behavioral tendencies, and actual activities, etc.
  • Trade this data either freely to selected parties or at a profit to parties who express demand for it.
  • Create new sources of revenue by providing identity and authentication as well as data management solutions to partners (e.g., identity verification, data management, storage services).

2. Optimize ID management through automated processes with encrypted identities:

  • Reduce ID-based fraud.
  • Introduce faster device identification during mobility thanks to a shared database with the device’s public key information and history at hand.
  • Create virtual identities using the public key from the digital identity.

To learn more about how Taraxa can help telcos and CSPs in optimizing data streams, contact us at partnerships@taraxa.io





CSPs get an edge with DLT-enabled data management was originally published in Taraxa Project on Medium, where people are continuing the conversation by highlighting and responding to this story.

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