Once again, we’re packaging some of the top news of the week in a quick-to-digest video format. If you missed some of the big tech stories this week, TechCrunched gives you the highlights. Take a look, have a listen and let us know what you think. Also, be sure to visit the below links for additional insights. → Read More
Zong has been one of the pioneers in the mobile payments space, adding a compelling new way for consumers to pay for items online. Simply put, it lets you pay for things, particularly virtual goods online, via direct billing to your mobile phone. The company has steadily grown its offering through new products, major funding, deals with Facebook, and more. Today, Zong is expanding its mobile payments platform beyond the web to televisions, tablets, game consoles and more.
In case you aren’t familiar Zong works, here’s a quick tutorial. When a user wants to purchase a virtual item, he can enters his cell phone number on a site, the site sends a text message to the phone, the user confirms the transaction with a short reply, and all the charges show up on his phone bill. This entire transaction is powered by Zong. Previously, Zong was only available for the web and on Android phones, but today is expanding its platform to work in a number of environments, including Flash, Unity, Interactive TV, gaming consoles, and the mobile web. → Read More
After announcing direct relationships with AT&T, Zong, Boku are announcing relationships with Verizon through mobile payments operator BillToMobile (MoPay, another competitor in the space also has a partnership with BillToMobile).
So why is this important? Historically, mobile payments companies face the challenge of lofty carrier rates. Wireless carriers have charged roughly 30% to 40% to process transactions made via mobile phone accounts, making it very difficult for mobile payment companies like Boku to scale beyond virtual goods. These transactions costs are passed down to developers using Boku and Zong, which are then passed to the consumer. To avoid these costs, Boku and Zong have been negotiating direct relationships with carriers as a way of possibly avoiding these costs. → Read More
There’s been much hype, crazy valuations, and overall market excitement about businesses that promise to unleash the power of the social graph, location, recommendations and group buying. Facebook’s latest valuation according to SecondMarket is now about $30 billion, Foursquare raised $20 million at a post-money valuation of $115 million while still at a pre-revenue stage, Yelp, short of selling for $550 million to Google, raised over $25 million at an undisclosed but very high valuation, and finally Groupon raised $135 million at a whopping $1.35 billion valuation. So besides their huge success with the investment community, and their users, what do these companies have in common, and what does all this have to do with disrupting Local Commerce?
Editor’s note: The following guest post is by David Marcus, founder and CEO of Zong, a mobile payment provider for Facebook Credits, AT&T and hundreds of leading destination websites and mobile applications → Read More
Fresh off an announcement of a strategic investment from VC firm Andreessen Horowitz, mobile payments platform Boku is taking its mobile strategy one step further by launching an in-app mobile billing library for Android.
The Boku Payments SDK allows developers to monetize any Android app with in-app purchases via carrier billing. Boku, which just launched last year, doesn’t require users to have a credit card or bank account to make a micropayment. Users enter their cell phone number, reply to a text message and then all virtual charges are automatically charged to the user’s monthly cell phone bill. → Read More
Recently-launched mobile payments startup, Boku, has announced that they have received a strategic investment from VC firm Andreessen Horowitz. Boku has declined to reveal the funding amount from this round, but to date the company has raised a whopping $38 million since its launch a year ago. As part of the deal, Marc Andreessen and Ben Horowitz will also take on an advisory role for Boku.
Boku, which just raised $25 million and rebranded its platform in January, doesn’t require users to have a credit card or bank account to make a micropayment. Users enter their cell phone number on the site, reply to a text message and then all virtual charges are automatically charged to the user’s monthly cell phone bill. As we’ve said in the past, it’s ridiculously easy. The company also acquired Paymo and Mobillcash over the past year, systems that had significant international reach, Boku gained a strong base of users around the world. Currently Boku is available in more than 60 countries and on over 200 carriers worldwide. → Read More
We’ve been tracking mobile payments provider Zong since 2008 – in a nutshell, it lets you pay for things, particularly virtual goods online, via direct billing to your mobile phone. Despite heavy competition from well-backed boku, the service has emerged as a leader in alternative payments. Facebook likes them so much they made them the mobile payment provider for Facebook Credits.
See our post Mobile Payments Getting Traction On Social Networks, But Fees Are Sky High from last year for a deeper dive on their business.
Early this year the company was spun off from its European parent, Echovox, and Echovox founder David Marcus moved to the U.S. to run the fast growing Zong. The company has now closed a new round of financing, its first as an independent company. Matrix Partners led the $15 million round, and partner Dana Stadler joined Zong’s board of directors. → Read More
Mobile payments for micro-transactions on the web are steadily gaining traction. This morning, the space received more validation as several prominent venture capital firms made a significant a investment in recently launched mobile payments startup, Boku. Boku has raised $25 million in Series C funding led by DAG Ventures with previous investors Benchmark Capital, Index Ventures, and Khosla Ventures participating in the round. This brings Boku’s total funding to $38 million since the startup’s launch in June. Boku’s marketing chief Ron Hirson tells me that the startup is also rebranding its consumer platform as Paymo, but will retain the name Boku on the merchant and publisher side.
Boku, which acquired competitors Paymo and Mobillcash in June, doesn’t require users to have a credit card or bank account to make a micropayment. Users enter their cell phone number on the site, reply to a text message and then all virtual charges are automatically charged to the user’s monthly cell phone bill. As we’ve said in the past, it’s ridiculously easy. Because of its acquisition of Paymo and Mobillcash, systems that had significant international reach, Boku gained a strong base of users around the world. → Read More
Zong has seen tremendous growth over the past year from when the company debuted its mobile payments service from the TechCrunch50 demo pit. Zong’s model of billing micropayments to your cell phone bill caught our eye and sure enough, less than one year later, the startup is picking up serious traction, including a partnership with Facebook to power the purchase of the social network’s new currency. And in 2009 alone, Zong has processed mobile payments for over 10 million unique users worldwide. Today, Zong is launching a new feature that not only expands its payment services, but could make a lasting impact on the micropayments field.
Zong is launching Zong+, a extension of the mobile payment startup which lets users bill microtransactions to credit, debit and prepaid cards. We have an exclusive demo of Zong+ by the startup’s founder and CEO, David Marcus, below. So in addition to making online purchases through their cell phone bill, Zong customers will also be able to link any type of payment card to their Zong account through a one-time entry process and continue to purchase goods by simply entering their mobile number and confirming the security transaction code sent to their phone. → Read More
Over the past year, we’ve written frequently about mobile payments startups and the potential future of this technology. Rivals Zong and Boku both offer essentially the same service—the ability to make a payment for a micro-transactions via your mobile phone. And both companies have been growing steadily, with Boku making acquisitions and expanding internationally and Zong picking up traction via a partnership with Facebook.
Today, Zong is upping the ante by offering a subscription service, which lets Zong customers to extend a recurring bill-to-mobile option of up to $9.99 a month. Basically, Zong users can now charge a flat-rate for multiple purchases instead of the existing pay-as-you go model. → Read More
Mobile payments for micro-transactions on the web are catching wind and there are several players in the space vying for the top spot in the field. Today, Boku, a recently launched mobile payments conglomorate of sorts, is announcing a slew of new customer acquisitions as well as details of its international expansion.
Boku, which acquired competitors Paymo and Mobillcash and raised $13 million in Series A funding back in June, doesn’t require users to have a credit card or bank account to make a micropayment. Users enter their cell phone number on the site, reply to a text message and then all virtual charges are automatically charged to the user’s monthly cell phone bill. As we’ve said in the past, it’s ridiculously easy. → Read More
While advertising revenues have been disappointingly low for most applications on Facebook and other social networks, another option app developers are increasingly turning towards is micropayments for virtual goods or premium features. Both Facebook and MySpace have admitted that they are working on their own payment systems, and Apple could play a role as well since it already has a payment system in place for iPhone apps (although even Apple is running into some bumps).
While the bigger players are fiddling with their payment system plans, nimbler startups are moving in to fill the gap. One of these is Spare Change Payments, which is trying to become the Paypal of micropayments. A year after launch, more than 700 apps across Facebook, MySpace, and Bebo use Spare Change for micropayments. Spare Change is processing $2.5 million a month in micropayments, which is a $30 million annual run-rate. The apps that are having the most success with micropayments are games and ones that sell virtual goods.
Now, the company is making it easier for consumers to pay through Spare Change with a new payment widget that pops up in each app instead of sending people off to a separate payments page. → Read More
Global mobile payments network Paymo and social network hi5 have partnered to let members in 24 countries use their mobile phones to purchase hi5 Coins, hi5’s virtual currency. Countries where Paymo will be made available to hi5 users include the U.S., Canada, France, Hong Kong, Thailand, Russia and Colombia.
Paymo’s mobile payment system doesn’t require users to have a credit card or bank account. Users enter their cell phone number on the site, reply to a Paymo text message and then all virtual charges on hi5 are automatically charged to the user’s monthly cell phone bill. It’s pretty easy and similar to UK mobile payments service, Zong. Paymo says that over 75 percent of the online community worldwide does not have a credit card but 3 billion consumers own a mobile phone. With that in mind, the company is hoping their system, which avoids credit cards or bank accounts, will take off. → Read More
Users are increasingly choosing dead simple SMS mobile payments for micro-transactions on social network applications and gaming sites (it fills the void while they wait for more direct options), but super-high transaction fees are limiting growth.
The problem is that legacy transactions – specifically scams that give users a “free” ring tone with the fine print mentioning a monthly charge as high as $20 – have brought in so much cash to the carriers that they’ve gotten used to taking 50% or more of the total payment in fees. For the market to grow to encompass legitimate transactions, those fees have to drop dramatically. For that to happen, the social networks need to get involved directly in carrier negotiations.
Two companies, both headquartered in Europe, are already targeting mobile payments for apps – Mobillcash (UK) and Zong (Switzerland).
When you buy a virtual shotgun on Mobwars, for example (and they are selling a lot of them, up to $1 million per month) you have to pay real cash. You can choose to pay via a number of services (Facebook doesn’t offer a direct payment solution yet), including either Mobillcash or Zong. → Read More
Mobile payments startup Zong, which is one of our DemoPit companies at TechCrunch50, thinks it has the answer to micro-payments on the Web for social apps like gaming, dating and classifieds. It uses your mobile phone as a way to pay for things such as virtual goods in Facebook apps.
The way it works is that you enter your mobile phone number to pay for something on the Web, maybe a virtual cowboy hat for 5 cents. Then you get a test message on your phone with a pin number. If you enter that pin number in a widget on the Web, the charge will be reflected in your cell phone bill. → Read More
Loren Feldman’s puppet video show, which parodies a video interview show run by Shel Israel called Global Neighborhoods, has landed an official sponsor, Feldman says. Meanwhile, Global Neighborhoods itself remains sponsorless. In the videos, a naked puppet interviews people (or other puppets) to talk about “social media,” making fun of Israel’s interview style. The puppet is naked as a spoof on Israel’s book, Naked Conversations, about the importance of blogging for companies. The new sponsor, Zong, a Switzerland-based mobile platform company, is providing “significant funding” to sponsor the parody Shel Israel show created by Feldman. This will be a serious ego blow to Israel, who has been mocked by Feldman and bloggers around the quality of the show and has publicly attacked Feldman over the parody. The fact that the parody, but not the official show, is now receiving financial support from third parties is a reflection of the entertainment value of the two shows. Not only do some people find the parody very funny, Feldman has also landed fairly well known entrepreneurs in his interviews. Now that Feldman is making money from the show, it’s probably here to stay, much to the real Israel’s chagrin. As I’ve disclosed before, Feldman and Israel are both friends of mine. I hosted the launch party for Shel’s book, Naked Conversations at my house in February 2006, and Feldman is staying at my house this week. CrunchBase Information 1938 Media Zong Shel Israel Loren Feldman Information provided by CrunchBase → Read More
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