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Least Cost Routing - Colocation America
Least cost routing (LCR) refers to the action of designating the optimal course of outbound communications traffic determined by costs. The LCR technicians at a telecommunications provider are constantly selecting routes from hundreds of carriers for locations across the globe. Least Cost Routers are devices that automate this process. The purpose of least cost routing directly deals with minimizing costs.
Least cost routing teams also take the quality of a route and call quality into consideration, especially when working within the calling card industry. This is important because poor LCR decisions will lower the call quality for starting a calling card service, and customers will be dissatisfied. For this reason, Least cost routing has largely contributed to both the increase in call quality and decrease in international calling costs in the industry.
How does least cost routing work?
Least cost routing technicians that work for telecommunication carriers will typically follow these steps:
1. A new price schedule is obtained through negotiations between buyers and their suppliers
2. These prices are input into software that calculates values such as termination costs, which are then analyzed
3. Routes are selected which fixes the cost-for-pricing, determining the new prices
4. The new routes are integrated onto the switch
5. Switch billing system produces reports that detail traffic margins and volumes which are then analyzed
6. Any bad traffic or routing errors are caught and corrected
Least Cost Routing software
Least cost routing teams will often use LCR software that allows them to do their job more efficiently. LCR software tasks include loading price schedules, automating the table coding process, monitoring volume commitment, comparing dial codes, organizing costs, incorporating quality variables, producing cost and routing schedules optimized for pricing analysts, generating automated processes to softswitch vendors, and transferring information into the VoIP billing software. Without LCR software, least cost routing would be a much more difficult task than it already is.
