Mobile carriers are looking for ways to catch some of the growth in smartphone usage beyond their basic role as network providers, and that trend is having a knock-on effect on startups that help those carriers: ItsOn, a cloud-based platform founded by ex-Qualcomm, Nokia and Yahoo execs that helps carriers configure, market and sell mobile services on the fly, has raised a further $12.5 million in funding.
The backing is led by Delta Partners Capital, with participation from several of ItsOn’s existing investors, including Verizon Ventures, Andreessen Horowitz and Tenaya Capital. The funding brings the total raised by ItsOn to just under $53 million.
Although Verizon — which owns TechCrunch by way of AOL, as part of its wider push into content, ads, and services beyond basic voice and data — is among ItsOn’s investors, it is not a carrier customer. Customers include Sprint, which last year took over the technology from Zact, ItsOn’s former B2C service, as the basis of Sprint’s own prepaid, non-contract mobile service. Vodafone is also among ItsOn’s investors but it’s not clear if it is also a customer.
ItsOn got its start in carrier services and, after its closure of Zact, this is where it is putting all of its focus today. The funding, the company says, will be used to invest in data centers in South America, Middle East, Africa and Europe for new market launches with more carriers.
The opportunity that ItsOn is trying to tap into is a rising set of demands from consumers, who want more flexibility beyond all-in costly subscriptions, and do not want to deal with the pain of phoning call centers or visiting physical stores whenever they want to change something.
That will only grow, especially as carriers extend into markets with tiers of more price-sensitive users. Today, there are 3.4 billion smartphones in use out of 7.4 billion mobile phones overall, but by 2021 we will have tipped into a largely-smartphone population, with 6.4 billion smartphones out of 9.1 billion phones overall, according to Ericsson.
“There’s a rapidly growing demand for our technology as wireless service providers face increasing end-user expectations, new opportunities and new competition,” said Dr. Greg Raleigh, Founder, CEO and Chairman of ItsOn in a statement. “This new investment round from Delta Partners Capital, Verizon and our other existing investors enables us to more rapidly expand global customer deployments while continuing to develop more innovations and maintain our lead in mobile network digital transformation technology.”
The kinds of services that can be implemented through ItsOn’s platform include application-based paid or sponsored plans — for example monthly data subscriptions to use a specific bundle of social apps; controls and upsells for tethering, roaming and speed boosts — for example giving people who roam to other countries an instant way to add on international data even if they didn’t sort it out before travelling; on-device plan purchasing and management and other self-service offerings; and parental controls.
ItsOn is not the only company trying to meet this need. Competitors include the likes of Amdocs and Opera.
ItsOn essentially offers a set of tools to carriers to create, market and charge for tailored service packages on a users’ device — linking up with a carriers’ billing and service deployment backends in the process. Its unique selling point, according to this video, is that these packages can be created and executed “without involving the IT department”.
And this, along with the general sophistication of what ItsOn is doing, is what attracted Delta and the other investors to this round.
“We are seeing a growing urgency among mobile operators to undergo a digital transformation and dramatically improve their end-user engagement. ItsOn’s mobile commerce platform is at least five years ahead of every other player in this space,” said Kristoff Puelinckx, cofounder and partner at Delta Partners, in a statement.
Updated with correction about Verizon being an investor, but not a customer.