A new study by Juniper Research (www.juniperresearch.com) as found that the value of digital content transactions paid for by carrier billing is expected to reach $47 billion by 2020, more than 4 times 2015’s figure of just under $11.3 billion.
According to the new research Apple’s decision to test carrier billing in Germany and Russia is likely to herald a substantial number of further deployments in the medium term. Juniper says the move will be essential if Apple is to monetize unbanked owners of refurbished devices in emerging markets, who would otherwise be limited to paying for content via iTunes gift cards.
The report also says that carrier billing solutions could be a key means of monetizing content purchased within an array of environments, including connected cars and for in-flight infotainment. However, the research found that the operator practice of setting daily or monthly carrier bill spend limits at a low level to minimize exposure to fraud or compensation claims was counterproductive.
“If you have a daily spend limit of $20 in place, consumers are severely constrained in the amount of content they can purchase, particularly given the fact that many content bundles – such as Clash of Clans gems bundles – are priced at close to this level,” says research author Dr Windsor Holden, research author. “Any savings from customer care time spent dealing with inappropriate or unauthorized purchases can more than offset by customer care time spent on failed purchases.”
He adds that while other payment mechanisms including PayPal were likely to experience significant growth, the majority of payments (69% by value in 2020) would continue to be made via debit and credit cards.