Data Centers Billing Management: Unlocking Automation, Accuracy & Agility

Data centers lend multiple services to their business clients. Service variety includes storage, computing power, bandwidth, server space and more. Because of such a multitude of offerings being provided to multiple clients at the same time, billing can become a maze for data center operators.

Maintaining billing integrity is especially necessary for these businesses as they have to establish trustworthy relationships with their clients—if they want to retain them long-term. And what’s better for building trust than getting billing right. Customers appreciate clear and non-confusing invoices that summarize their payments and data usage perfectly.

That’s why data centers today need advanced billing solutions more than ever before—to monetize their services better, and to build healthier customer relationships. Let’s find out how a good billing software helps achieve these goals.

The Challenge of Data Center Billing

Data centers aren’t like regular one-product subscription businesses. They sell a combination of services at the same time. From internet bandwidth to computing power to managed services, and a lot more. The more offerings there are, the more customer diversity, and the more billing complications.

So these are the major challenges these infrastructure providers face:

• Resource diversity

One customer may subscribe to more than one service offered by your data center. Customers in this industry are mostly enterprise-level SaaS companies with considerable needs and expectations. Since they subscribe to a mix of resources, it gets very tricky to track multiple services for each customer.

When tracking becomes difficult, it becomes more challenging to keep billing fair for all. Businesses also have to figure out whether to combine a customer’s charges, whether to invoice for each service separately, and whether to keep the billing cycles aligned or not.

• Fluctuating usage

This is characteristic of services that charge on the basis of usage. Manual billing struggles to keep up with real-time client usage, as it lacks the mechanic precision required for accurate tracking. Even if a business somehow tracks usage manually (not in real-time, but daily, weekly or monthly), converting usage into bills is still a critical part it can go wrong with.

There can be different usage metrics for each of a data center’s services. Let’s take the example of storage units, a common usage metric for cloud-storage services. Imagine there’s a company that uses different TBs of storage each month: 5 TBs one month, then 7 TBs the next, and then 3TBs the next.

This company’s usage is clearly highly unpredictable. And the business has to do manual billing calculations from scratch each month to get this client’s bills right.

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• Customer disputes

Unclear invoices lead to customer disputes. Invoices are unclear when they lack usage and overage breakdowns, i.e. how much the customer rightfully used in a given period, and how much extra they utilized. Unless the invoices don’t tell customers that, they’re not going to fully understand their charges.

Lack of understanding can deteriorate their relationship with the business, as they might see their charges as unfair. This ultimately leads to payment disputes where customers question their charges and your support team tries its best to satisfy them. Such disputes always delay payments, and if customers are not satisfied, then they can cause churn as well.

Making Billing Effective with the Right Pricing Models

Data centers billing management is incomplete without effective pricing models. Your choice of pricing models matters a lot as it helps you monetize your services the right way. Advanced subscription billing software gives you all the variety you need to choose from and test with your services. These are the most popular billing models data centers can leverage:

1. Flat-rate

This model works for clients that don’t have fluctuating service needs. They need standard access to a service with pre-defined usage limits and fixed costs. For example, a data center can charge flat $200 per month for its standard server access.

This kind of pricing is great for predictable cash flows, but can’t be implemented for clients with flexible usage needs.

2. Tiered

Tiered pricing encourages more usage by offering discounts as usage increases. For instance, users have to pay $100 per month for 1-5 TB storage. But once their usage limit crosses 5 TB and enters the 6-10 TB tier, their per month price drops to $80.

3. Pay-as-you-go

Clients pay according to their consumption level, not a penny more or less. This pricing model supports services with fluctuating and unpredictable usage. It doesn’t force clients into standard plans where they are bound to pay fixed recurring amounts.

So data centers can use this model to their advantage, and charge heavy and light users differently. This also gives them the opportunity to scale revenue with scaling usage. Furthermore, they can acquire clients belonging to different growth stages such as enterprises and mid-sized businesses, as charges aren’t fixed and there’s no rigid entry barrier in place.

To manage pay-as-you-go billing, billing software with smart metering capability is a must-have. Because this pricing type requires real-time usage tracking. Without that, invoicing lags and bills become unreliable.

4. Hybrid

If data centers want to retain charge predictability, and want to offer pay-as-you-go at the same time, a hybrid pricing model is what they need. Hybrid models let you combine more than one billing mode, so that you can develop a billing strategy that gives benefits to both you and your customers.

For instance, a business can fix a $200 base fee for the first 5 TBs of data storage. Each extra GB after that can cost clients $0.05. So a client’s total charges include the fixed usage payment as well as the variable overage payment.

5. Contract-based

Enterprise-level clients prefer custom billing contracts; as standard subscription plans don’t always suit them. So data centers can create custom contracts for them that are aligned with their needs, service expectations, usage volume, and more.

Contracts can be multi-year deals with billing intervals customized for a company. They are based on negotiated terms and agreements regarding factors like uptime and customer support. And clients can also be promised benefits such as volume-based discounts when they reach certain usage levels.

Plus, a contract also mentions the renewal preference of the client—whether they prefer manual renewal or automatic, or if they need performance-based extensions. Since contract billing has various aspects to handle, it is best managed with a dedicated billing platform.

How SubscriptionFlow Gives Data Centers the Billing Flexibility They Need

Having SubscriptionFlow as your billing backbone means billing based on the pricing models of your choice. The software takes care of your service diversity, lets you create appealing plans for each service, and even hybrid plans combining multiple resources.

Here’s what data centers billing management with SubscriptionFlow looks like:

• Automatic usage metering

The software can track any usage metric you support. It can monitor bandwidth, compute hours, storage, and many other metrics in real-time. After monitoring, it keeps all the usage in its record, and then converts it into invoices when a billing cycle ends.

The billing software doesn’t overlook even the smallest usage instances that can contribute to micro-transactions if charged separately. It accurately captures these instances when aggregating usage and applying billing logic.

• Diverse pricing models

SubscriptionFlow allows implementation of all the billing models listed above. Data centers can bill according to the model that resonates with their offerings the most. And the good news is, automated billing is supported through each model.

Even if clients prefer manual payments, the software helps generate one-click payment links that make payments faster and more convenient. Other than that, all billing flows like invoicing, proration, invoice status updates etc. remain automated to preserve accuracy.

• Dynamic invoicing

Invoices are tailored for each client. They present a breakdown of the customer’s usage, and the respective charges incurred by this usage. If clients go beyond certain usage-limits and consume extra, the invoices mention their overage amounts too.

• Wide range of payment gateway integrations

Businesses can build diverse gateway-stacks that let them accept payments from the countries of their choice. SubscriptionFlow is equipped with the multi-gateway capability, supporting global and country-specific gateways both. It allows you to activate many payment gateways at once so you can receive payments from multiple active channels harmoniously.

• Usage reporting

For maximum transparency, clients can also view their own usage in their self-service portals. This way, they can keep their consumption in check, and can also track overage whenever they need to consume more. Moreover, they can export their usage reports as well to match with their invoices.

Don’t limit your revenue opportunities by holding on to obsolete billing procedures. Bill with SubscriptionFlow, and have all the right pricing models at your disposal.