Research Notes

New report from Strand Consult shows that mobile- and fixed line operators have enormous opportunities in the micro-billing area

– in Denmark TDC is currently testing micro-billing with one of the country’s largest media.

A great deal has been said and written about micro-billing through the years and there are many examples of national, regional and global solutions that have tried their hand on this market. The best-known is most probably PayPal that has over 150 million members worldwide.

Many media companies and online service providers believe that the lack of availability of micro-billing solutions is one of the reasons why it is so difficult to make money online, and especially to create, publish, market and sell news. One of the largest media groups that has a very clear opinion regarding this is Rupert Murdoch’s News Corp, who recently started charging customers for viewing the UK-Times online news.

When we examine today’s mobile industry we can see that micro-payment not only functions, but is also a financial success for both mobile operators and companies that develop, market and sell various mobile services. It is a fact that there is today a multi-billion euro global market for games, ring tones, wallpaper and various applications. Basically almost all mobile operators around the world offer their partners a micro-payment solution that works across all mobile phones in use today. In the mobile world, billing mobile services is not complicated.

From 1998 onwards the mobile services market has developed into a global market for premium services and has created a global industry that develops, markets and sells services. Payment for these services are handled via the mobile operators’ billing systems. In practice almost all of the world’s 4.4 billion mobile customers today have access to micro-payment solutions and in many countries between 40 and 60% of mobile customers have at one time or another used this type of payment.

Strand Consult has been following this market since 1998. The reports we published from 1999 to 2002 were back then used by many operators as the foundation of their premium SMS strategy and their micro-payment solutions in the form of premium SMS models, that have subsequently been launched by operators around the world during the past 10 years. Over 10 years ago we predicted that this market would be enormous – 10 years later the market is still going strong with many content providers exclusively basing their current business on the mobile operators’ micro-payment solutions.

In Strand Consult’s new report Show me the money – The future Business models for mobile Broadband Services we not only describe how we believe the micro-payment models we know so well from the mobile world will migrate to the online world, we have also described how TDC is currently testing online micro-payments together with a large media company.

In just a short while, many Danes will be able to use their mobile broadband connection to purchase access to online content and services, and payment for these services will be added to their telephone bill, while revenue will be divided between the content and service provider and the Telcos that offer this new type of micro-payment system.

At Strand Consult we believe that micro-payment via mobile broadband connections – and at a later stage via ordinary broadband connections – can very quickly develop into a successful and profitable business. We believe that there are many countries were Telcos have the opportunity to play a central role in the micro-payment area regarding charging for the consumption of online news and services. The only question is how quickly will this take off and what will it take before operators realise that their current success in the mobile world can give them exciting new opportunities on the traditional Internet?
You can learn much more about this market, what is happening and how we believe this market will develop over the coming years. Order more information about our 180 page report Show me the money – The future Business models for mobile Broadband Services   that describes in detail all the aspects an operator and other players on this market should consider.

More information
: Show me the money – The future Business models for mobile Broadband Services

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