Big changes in Mobile Carrier Billing Will Affect Payment Possibilities

In most businesses, it makes a difference whether a firm's direct costs are 40 percent or 10 percent. Up to this point, revenue splits of about 60 percent for the merchant and 40 percent for a mobile carrier have sharply limited the types of products that can be sold using the mobile device and carrier billing.

In other words, products bought and billed directly to the mobile statement have imposed higher transaction costs, by far, than use of credit and debit cards, for example. Zong knows all about carrier billing, but has been predicting there would be significant movement on the charges, as Zong volume has grown. That appears to be happening.

The carriers are dropping the revenue splits to closer to 10 percent, from 40 percent. “The carriers won’t go below 10 percent for digital or virtual goods, but they will lower their rates for physical,” says David Marcus, the CEO of Zong.

Zong Sees Mobile Payments Coming for Physical Goods Sooner Than You Think

Google Sees Both Loyalty and Advertising Angles to Mobile Payments

There's little question at this point but that Google intends to use near field communications in ways that might use the payment function, but almost certainly will focus on advertising, couponing, loyalty and other elements of the retail shopping experience.

In fact, payments as such might not be Google's primary interest in near field communications. Google might see much more upside in working with advertisers to extend offers to phones, perhaps including couponing and other offers as part of the ads.

Google's Eric Schmidt Reveals NFC Smartphone Plans: It's All About Advertising | Fast Company

Mobile Users are Task Oriented, Tablet Users More Entertainment Oriented

Research to date on tablet advertising has typically found that placements that take advantage of the full features of the device—like video, 360-degree views, striking photos and interactivity—appeal most to users. An Adobe-sponsored study found flashy iPad ads were more engaging and effective than their static print counterparts, and earlier research from UM and Time Inc. indicated that videos were the most desired feature of iPad ads.

On smartphones, by contrast, users seem to prefer to keep it simple. A Pontiflex survey conducted by Harris Interactive found that very few smartphone users preferred ads that were like commercials or that featured video. Just 15 percent of all adults liked such ads on their phone, vs. 63 percent who preferred more basic coupons, deals or newsletters.

So it appears the flashy video ads are better suited to tablets, while coupons are better suited to smartphone users.

The Differences Between Mobile and Tablet Advertising - eMarketer

Mobile Banking in Africa to Hit U.S.$22 Billion By 2015

The International Telecommunications Union estimates mobile subscriptions across Africa more than tripled to 333 million since 2005. The World Bank said Sub-Saharan Africa averages just 163 bank accounts per 1,000 adults — compared to an average 635 in developing countries.

In 2006, Kenya had only 450 bank branches and 600 automatic teller machines, or less than two bank branches per 100,000 people. Read more here.

Taking the overall population as the potential target market, the penetration rate of mobile telephony in Uganda is now 35 percent, while in Liberia, it was around 31 percent in 2009. In Cameroon, where MTN and Orange have a duopoly, the penetration rate was around 38 percent in June 2010. In Kenya, mobile penetration is 50 percent, while in Rwanda, it was about 25 percent in early 2010.

South Africa’s Wizzit is another start-up. Its operations are guaranteed by the South African Bank of Athens. Managing Director Brian Richardson will not disclose the number of subscribers, but says the operation turns a profit.

“I do believe the bank-led model will win at the end of the day,” he says.

Mobile Banking in Africa to Hit U.S.$22 Billion By 2015

Visa Likes Square

Square allows small merchants, who have traditionally been limited by paper-based payments, to accept electronic payments through a credit card reader that plugs into a phone or iPad. "This is a big deal and will help the entire payments industry’s efforts in bringing access to electronic payments to a segment that has historically not been easy to serve, namely very small merchants," Visa says.

Before, these very small merchants depended solely on the limits of cash transactions, Visa says. Now with Square’s product, these small merchants can use a mobile device as a gateway, making a transaction over Visa’s global network and gaining the security, speed and reliability that come with it.

Emerging Payment Types = New Opportunities | Visa’s Blog – Visa Viewpoints

Smartphones Increasing Call Center Volumes

More than 60 percent of 55 service providers polled by Heavy Reading believe that the volume of smartphone-related support calls has increased 10 percent to more than 25 percent over the last two years. The same percentage believe the average cost of supporting smartphones is anywhere from 10 to 50 percent above that of standard feature phones, due in part to longer call-handling times. Additionally, more than half of the incoming calls are not resolved by the initial call center representative who handles the call - further driving up costs.

Some 75 percent of service providers surveyed are looking to advanced services to increase data usage and realize additional sources of revenue from smartphone customers. But the research shows that over two thirds of customers do not use advanced services, due to lack of awareness or understanding.

Operators Want Higher Smartphone Revenues, But Need to Educate Customers on Using Advanced Features

FCC Chairman Says Net Neutrality Rules Don't Cover Comcast-Level 3 Dispute

Federal Communications Commission Chairman Julius Genachowski said the agency's net neutrality rules don't cover interconnection disputes such as the current dispute between Comcast Corp. and Level 3 Communications.

He called the Comcast-Level 3 issue a private business dispute and said he hoped the two companies could work out their differences.

Long-time observers of the interconnection business and framework will not be surprised by those views. Carrier interconnection is about the business relationship between network owners, not end user services.

WSJ: FCC Chairman: Net Neutrality Rules Don't Cover Comcast-Level 3 Dispute - WSJ.com (subscription required)

Google One Pass Enables Content Micropayments

Google One Pass is a payment system that enables publishers to charge consumers for articles and other content. It offers purchase-once, view-anywhere functionality, so users can view the content they buy across all of their devices.

Google One Pass supports subscriptions, day passes, metered access, pay-per-article and multi-issue packages.

Google One Pass

RIM, Telefonica to Support Carrier Billing for BlackBerry App World

Research In Motion and Telefonica are working together to introduce "BlackBerry App World" with integrated carrier billing, on a global basis.

Carrier billing will allow Telefonica customers to purchase apps from BlackBerry App World and charge the purchases directly to their monthly bill. Customers will also be offered the flexibility of charging in-app purchases to their carrier bill which allows for the purchase of digital goods to be made without interrupting their application experience.

BlackBerry - Press Releases

YouTube The Next Netflix?

Google believes that YouTube’s future is to market premium content and streaming services to its hundreds of millions of users. Google has figured out that advertising-supported content cannot make YouTube profitable. It needs another revenue source, and subscriptions for premium content access are the likely and logical choice.

YouTube–The Next Netflix - 24/7 Wall St

Eric Schmidt: Ice Cream Will Finally Merge Android Gingerbread and Honeycomb

Today, Android smartphones run one operating system, while some tablets run a different version known as Honeycomb. If you wonder whether a common version is coming, you would likely be correct, allowing Android to build a more-integrated ecosystem that could have Android smartphones and tablets working together, sharing applications more elegantly and possibly, in some implementations, raising new issues about the "one device" a user finds most useful to carry around.

"We have OS called gingerbread for phones, we have an OS being previewed now for tablets called Honeycomb," notes Google CEO Eric Schmidt. "The two of them, you can imagine the follow up will start with an I, be named after dessert, and will combine these two.”

Eric Schmidt: Ice Cream Will Finally Merge Android Gingerbread and Honeycomb

RIM Playbook Tablet

Research in Motion goes with a seven-inch form factor for Playbook tablet.

Mobile Will be a Powerful Ad Medium, But Agencies Will Struggle With Apps

WPP chief executive Sir Martin Sorrell predicts it will be difficult for advertising agencies and other companies to profit from apps, though mobile will become a powerful advertising medium.

Though the app market has tripled in size to $15 billion, the advertising industry overall is about a trillion dollar industry, he notes.



Asked how the ad industry can make the most of the boom in apps, he was cautious. "I think the real answer is 'with difficulty' because it's not dissimilar to what you're seeing with newspaper and periodicals."

The amounts of income are becoming more significant but are highly fragmented, he said. "You have a vast array of applications and a vast array of designs and consumer loyalty is quite fickle ... It's very volatile."

VIDEO: Sorrell on apps, mobile and social networks

What is a Facebook Phone?

Two upcoming Android devices from INQ, the Cloud Touch and Cloud Q, feature new Facebook integrations with single sign-on and easy one-touch access to popular Facebook features. The home screen features a user's "News Feed" (including your friends' updates, pictures, videos and links) and quick links to Chat, Messages, Places, notifications and more. Users also can also check in to your favorite shops and businesses with Facebook Places, right from the home screen.

HTC's ChaCha and Salsa phones feature a dedicated Facebook button that gives you one-touch access to a user's favorite Facebook functions, allowing users to update your status, upload a photo, share a news article and check in to places. Facebook Chat, Messages and your friends are also integrated, so when a user makse a phone call, the screen displays the user's friends' status updates and photos, and birthdays.

With enough customization and personalization, a multi-purpose smartphone can be transformed into a device with unique characteristics and value for users, even when built on a standard hardware platform. If you wonder how a differentiated communications experience can be built, this is one example.

A Better Mobile Experience

Google CEO Eric Schmidt Speaks at Mobile World Congress