Telefónica has established global framework agreements to offer direct-to-bill payments for Facebook, Google, Microsoft and Research In Motion (RIM). Direct-to-bill services allow consumers to buy content and other goods and services via their mobiles and have the charge added to their phone bills.
It is expected the service will prove popular in countries where credit card penetration is low, such as Brazil, where 60pc of the population do not have bank accounts.
Telefónica says it has already started rolling out the capability and plans to have it live in 14 of its operating businesses globally by the end of this year.
Direct-to-bill offers mobile operators an opportunity to wrest back the initiative in a burgeoning market for mobile content and services, as well as new ways to pay.
Whether they are buying an app, mobile game or making an in-app purchase, direct-to-bill enables the customer to simply charge the payment to their phone bill or prepaid credit, avoiding the need to use a credit card.
Recent research from MACH found that more than a third of European smartphone users have paid for applications via operator billing.
The future of mobile payments
Where the capability has started to be rolled out it is already proving popular with customers. In Germany, 400,000 customers per month on average are now making payments for a variety of products and services across different platforms using the capability.
Telefónica has already begun integrating operator billing with Facebook payments, enabling a frictionless two-step process for purchasing virtual or digital goods via Facebook.
“Mobile payments are an important part of the business model for mobile web developers, but today the options are too complicated for users,” said Dan Rose, vice-president of Partnerships at Facebook.
“We’re excited to be working with Telefónica to implement a streamlined operator billing solution that simplifies the purchase process for their consumers and expands pricing options for mobile web developers.”
An agreement with Google will see operator billing offered as a payment option through the Google Play Store.
An operator billing agreement with Microsoft will see direct-to-bill become the default payment option for Telefónica subscribers making purchases in Windows Phone Marketplace.
RIM has also decided to enable direct-to-bill payments to enable BlackBerry users to purchase apps via the BlackBerry World store and charge them to their phone bills. This is available in the UK and Germany via premium SMS.
“Few organisations can claim to have a direct billing relationship with hundreds of millions of customers globally,” said Matthew Key, chairman and CEO of Telefónica Digital.
“The creation of Telefónica Digital has allowed us to better harness the power of this capability and use it to help drive the mobile monetisation strategies of some of the world’s largest technology companies. We believe that direct-to-bill will become an increasingly significant part of the overall mobile commerce market,” Key said.
Mobile money image via Shutterstock