Prepaid service has become an important mobile application with rapid growt
h for subscription rate in the recent years. Implementation of prepaid serv
ice may generate large network traffic that significantly affects the perfo
rmance of a mobile network. This paper studies the hot billing solution for
prepaid service. We investigate how the amount of prepaid credit and the F
requency of call detail record (CDR) transmissions affect network signaling
and potential bad debt that a service provider may bear. Our study suggest
s that a prepaid service provider should encourage customers to buy large p
repaid credits by giving them discounts. Furthermore. based on call traffic
, an optimal CDR transmission frequency can be found by using our modeling
technique. (C) 2001 Elsevier Science B.V. All rights reserved.