Fortumo announced that it has inked direct carrier billing agreements with China Unicom and China Telecom. Together with a China Mobile deal signed in February, this means that the Estonia/U.S.-based mobile payments company is now the first and only payments provider that supports all three state-run telecoms in China, which dominate the mobile communications market there.
Fortumo, whose clients include Rovio, EA, Gameloft, Zeptolab and Badoo, will now be able to help developers gain a potentially large and lucrative foothold in China. Fortumo works with developers who want to break into countries where few consumers use payment methods like credit cards and instead pay for app downloads through their mobile carriers.
Carrier billing accounts for up to 75% of all revenue generated from Android apps in China, says Gerri Kodres, Fortumo’s Senior Vice President of Business Development and Carrier Partnerships.
“China has a number of payment options, including Uni-Pay and Alipay, but during the last six months carrier billing has taken a very strong market share,” says Kodres. China currently accounts for less than 10% of Fortumo’s revenue, but Kodres anticipates that number will grow to about 30% within two years.
Fortumo also helps foreign developers localize in China’s fragmented app marketplace by giving them access to different distribution channels. This is important because Google Play is inaccessible there and Android apps are sold through several platforms. Fortumo distributes apps in all leading Chinese stores, including stores operated by China Mobile, China Unicom and China Telecom, Baidu and Qihoo 360’s app stores, 91 Wireless, Wandoujia and HiAPK.
“If you want to help Android [app] merchants in China, then you can’t just provide billing, you also have to help them with distribution because the market is much different in China than elsewhere globally,” says Kodres.
Another important channel is pre-loads on mobile phones. In June, Fortumo announced a partnership with Chinese mobile manufacturer ZTE Joygor to power in-app payments and preload apps onto Android smartphones destined for domestic sale or export to countries such as Indonesia.
Kodres says his company will continue to pursue similar deals with other manufacturers as it expands its business in China. Fortumo recently opened a Beijing office and has signed international distribution agreements with top Chinese developers like CocoaChina (Chukong), Gamewave and Boyaa.
Fortumo was launched in 2007 and currently supports carriers in about 80 countries. In February it raised about $10 million in funding from Intel Capital and Greycroft Partners.