Mobile payments company Bango — partner to Facebook, Amazon, BlackBerry and others to enable app and content charges directly to your mobile phone bill — has announced another major carrier partner: Telefonica is enabling Bango payments via its payment API.
The global deal (RNS statement embedded below) will mean that developers who make apps for Telefonica’s 314 million subscribers will be able to integrate a single API into their apps and mobile websites to enable two-click carrier payments across app stores in Bango’s network. These include Facebook’s App Center, Google Play, BlackBerry App World, Amazon’s Appstore, Windows Phone Store, Opera’s app store and an upcoming app storefront that Bango says it’s keeping under wraps for now. (My guess: an app storefront for Firefox Mobile, since Telefonica is a partner in that venture, but who knows — maybe it’s Apple finally coming around to carrier billing…)
This deal builds on the news from July 2012 that Telefonica had signed global agreements with Google, Facebook, Microsoft and RIM for billing content on their app stores. Meanwhile, Bango also counts France Telecom among its other carrier customers.
Financial terms of this new deal were not disclosed, nor were its revenue-sharing/commission details, which Telefonica says will vary on a country-by-country, store-by-store basis.
Bango is not Telefonica’s first carrier billing partner. It also works with Boku, which received a $35 million strategic investment led by the carrier last year. Jose Valles, the head of BlueVia at Telefonica Digital, says that working with one does not cancel out the other.
“This is not exclusive,” he said in an interview with TechCrunch. “This is about enhancing the ecosystem. Not all companies work with Bango and not all companies work with Boku, so we will be collaborating with both of them.”
Nor is the the first time the two have worked together. Bango first provided Telefonica with a carrier billing solution some 10 years ago (without the use of an API to interconnect to third party sites).
Although Telefonica has been offering carrier billing for a while now via its own payment APIs, the difference here is that Bango has already forged the deals with multiple app store providers. This makes its single API more powerful and less complicated to implement.
“It gives us a focus on app stores and frictionless, low-click payments,” said Matt Dicks, head of marketing for Blue Via, Telefonica’s developer platform. “That’s not what telcos do very well.” Blue Via is integrating Bango’s API with other APIs that link into Telefonica services, such as messaging, VoIP and more.
Bango says that apps and other content enabled with carrier billing have a 77 percent conversion rate, compared to 40 percent for content that requires credit card or other payment information. But there is still a lot of work that needs to be done to make carrier billing ubiquitous and used more.
“The big Internet companies are still not fully engaged about the opportunity with operator billing,” admitted Anil Malhotra, VP of strategic partnerships for Bango. In that sense, these deals work both ways for Bango. The more carrier partners it racks up, the more likely companies like Twitter, Nintendo and Sony will also integrate billing into their services — if and when such a need arises.
That is also boosted by another initiative launched by Telefonica — to integrate more carriers onto its API platform. The first of these is Telenor, with more expected to be announced in due course.
“BlueVia is a bold and valuable initiative by Telefonica to establish a unified set of billing APIs. We will standardize on BlueVia to connect with Telefonica’s 314 million subscribers around the world and look forward to welcoming other operators who join this initiative, as Telenor has done,” said Bango CEO Ray Anderson in a statement.
Although the opportunity for carrier billing is one that applies to any market, one of the big aims in this deal in particular is for emerging markets in Telefonica’s footprint — specifically Latin America.
In countries like El Salvador, Venezuela and Brazil, credit and debit card penetration is relatively low, so Telefonica, developers and others in the app ecosystem need other routes for payments. This is where carrier billing perhaps comes into its own, as a mass infrastructure for the “next billion” smartphone users to make mobile content purchases on their devices.
Bango and Telefónica announce global mobile payments partnership
Cambridge and Madrid, January 17th, 2013. Bango (AIM: BGO), the mobile payments and analytics company, and Telefónica Digital today announce that they have signed a Global Framework Agreement. The two companies will partner globally to create an enhanced direct-to-bill payment experience for mobile app stores. The partnership will combine Bango’s frictionless payment experience with Telefónica’s BlueVia Payment APIs, connecting over 314 million chargeable customers worldwide to the Bango Payments Platform.
The ability to pay for digital goods and services via a mobile phone bill or prepay credit is a key way for content owners and developers to fully monetize their products. This is especially the case in developing markets, such as Latin America, where penetration of bank accounts and credit cards is very low. Trials of direct to bill in Telefónica operating businesses have proven its ability to drive sales. Where Bango has introduced operator billing to developed markets with high credit card penetration, sales of digital goods have increased significantly.
By integrating the single BlueVia billing API into the Bango Payments Platform app stores will benefit from Bango’s enhanced user experience for mobile devices, which generates higher payment conversion rates, especially from Wi-Fi-connected and other “off-network” devices. This is particularly important for the future of mobile payments as more than half of smartphones browsing app stores use Wi-Fi connections.
A key goal of the partnership is to accelerate the availability of a standardized and open payment platform for all app stores and content providers and to dramatically improve the customer experience. The platform will be available to all app stores, supporting operator-billing and other payment methods through a single, common platform. The advantage to the customer is a seamless payment flow with no requirement to enter personal information or leave the payment session.
As well as technology to improve the user experience, Bango is contributing to the partnership its market-leading expertise in managing payments at mass scale, developed over several years with industry-leading partners such as RIM, Facebook, Opera and others. The Bango platform expands the attractiveness of operator billing to third parties by automating all settlement processes, including tax reconciliation, local currency support and providing sophisticated analytics and reporting that enable App Stores to optimize the mobile user experience.
Telefónica is rolling out direct to bill capabilities in its operating businesses and earlier this year announced global, framework agreements with Facebook, Google, Microsoft and RIM.
Bango CEO Ray Anderson commented that “Telefonica and Bango share a strategic vision: to widen access to paid content by standardizing and simplifying operator-billed mobile payments. BlueVia is a bold and valuable initiative by Telefonica to establish a unified set of billing APIs. We will standardize on BlueVia to connect with Telefónica’s 314 million subscribers around the world and look forward to welcoming other operators who join this initiative, as Telenor has done”.
Speaking for Telefónica Digital, Jose Valles, Head of BlueVia, said: “At the heart of every great service is first class customer experience and both Bango and BlueVia share the vision that mobile payments must be seamless and low friction for the customer. Through this partnership, we are delivering a mobile billing ecosystem that empowers the app store and content owners to achieve mass scale in their business through global reach and a payment method far broader than credit cards”.
The partnership between Telefónica and Bango was negotiated by Telefónica’s Financial Services and Global Partnership teams, based in Madrid and Silicon Valley and headed by Joaquín Mata and Wayne Thorsen, respectively.