Why Direct Carrier Billing

Until recently, Premium SMS has been the main way to which mobile users across the world have paid for content, like mobile games and ringtones. Although all mobile phone users could make use of this method of mobile billing it has a number of disadvantages in terms of ease of use – fluidity of the payment process and refunds.

Credit card options have become popular with stores like iTunes using this option as their preferred method and with this gaining a loyal user base, but the disadvantages to using credit card are larger than any other form of mobile billing, with the simple fact you have to pre-register (or fill out a form) on a mobile device to use credit card as a mobile billing option.

The new kid on the block, Direct Operator (or for those in North America, ‘Direct Carrier’) Billing, is here to not only have an immediate impact and offer these content stores a real alternative, but it is highly possible that this could ‘replace’, or at least have larger market share over premium and credit card options in the longer term.

For this to happen though, one important thing needs to unfold and that is the operator cut – their ‘revenue share’.

In recent years, mobile operators worldwide have historically taken a higher revenue share of the retail price for digital mobile content – they claim this is to deal with issues around bad debt, resulting from legacy mechanisms like premium SMS that partly account for this. This is slowly starting to change however, with larger brands choosing Direct Carrier Billing as their preferred billing option and with rates from 15-30% coming into play its not hard to see why.

Direct Carrier Billing Adoption

Direct Carrier Billing has become more widely adopted for in-app payments than its given credit for or maybe even thought about.

Let’s not forget here that Apple takes as much 30% from their own billing option with iTunes. Nokia with the Ovi Store uses Direct Carrier Billing as their preferred choice above credit card, as now does Mircosoft. Both having direct deals with mobile aggregators to make sure localised billing is available via their customers mobile operator.

Direct Carrier Billing Advantages

Direct Carrier billing (also known as Direct Billing) brings together the advantages of Premium SMS (being available to all mobile phone users) with the advantages of debit/credit card payment (reliable, easy audit trail, no charge backs) while also providing a low-friction purchase environment (no forms!!).

Merits of PSMS and Carrier Billing:

Premium SMS
Major Advantage
- Premium SMS Available to all mobile phone users

Major Disadvantage
- Multiple steps needed to make payments resulting in low conversion rates
- Inability to support refunds

Direct Carrier Billing
-Available to all mobile phone users
-Supports refunds and itemisation
-Secure (if properly implemented)
-Enhanced conversion rates
-Greater fraud protection

Operator Spending Caps

Direct Carrier billing provides several very important advantages over the competitors offerings, with low friction purchases being the most notable benefit from an application stores perspective (thereby increasing ‘in-app’ conversion rates), while also being accessible to customers who do not have credit or debit cards.

If mobile operators can continue to reduce their share on the transaction, the future of direct billing looks very bright indeed.

Related Posts:
6 reasons Direct Operator Billing will succeed

txtNation provides Direct Billing in multiple markets.

Why Mobile Number Portability Lookup (MNP Lookup)?

Using HLR Lookup is now more essential than ever for your mobile marketing success due to more and more customers moving mobile networks, sometimes multiple times.

- Mobile Number Portability (MNP) has been released in over 50 countries and growing.
- More than 250 million mobile numbers have already ported.
- Over 2 billion users are able to port at any time.

Whilst Mobile Number Portability benefits mobile customers – giving them the freedom to move provider, however it causes untold headaches for service providers who need to realise the mobile network in order to bill or deliver messaging services to the ‘exact’ operator.

Mobile Number Portability Lookup importance for marketing

Without a Mobile Number Portability Lookup, the service provider not be aware of the mobile network the subscriber belongs to and this can be costly!

Using HLR Lookup you can reduce costs by removing bad mobile numbers and identity those that have ported to another network and more importantly, for your overall marketing success – removing the wasted effort and costs when sending SMS messages for your campaign!

The txtNation Gateway allows our clients to find the mobile operator a mobile subscriber belongs to using our HLR Lookup API connectivity, quickly and easily.

Recent Press:
txtNation launches new HLR Lookup platform

Related Topics:
Overview of txtNation’s HLR and Mobile Number Portability Lookup (MNP Lookup)
HLR Lookup – Number Portability Lookup (Network Services – IMSI Lookup)

Bulk SMS Provider pricing

Have you noticed that when you get a quote from a Bulk SMS provider that it can fluctuate for the same country?

And that they claim to offer the lowest price available and they provide the most reliability?

Here is the reality on what is really happening behind the scenes.

Companies like txtNation are a local SMS Gateway operating ‘locally’ in all of our markets, meaning we are compliant with the local regulators and have direct connections with the mobile networks.

You also have the wrong option – connecting to an off shore SMS Gateway where you are sending from international routes, which means your message may not reach your destination! This is a very important distinction as this may result in your SMS marketing campaign’s success or failure.

Bulk SMS Provider Case Examples

Let run over a couple of examples when using a Bulk SMS Provider:

In the first option, when you send an message it goes to the Bulk SMS Gateway in say usually in under 10 seconds, with 99.9% reliability of delivery on the handset – almost instantly.

If you go via an international routing option to get a cheaper rate (and its cheaper for a reason!) your SMS message gets routed off shore, then maybe via one or two more hops and finally comes back to a local gateway, then back to the phone. This whole process can take up to 10 minutes and in most cases has a 70%-80% delivery rate, meaning a large proportion of users don’t even get the message!

Bulk SMS Providers – Why don’t users get your message?

If using off shore routes with your Bulk SMS Provider, the delivery rates will be very low due to:

– Mobile networks like O2 and Vodafone for example, consider overseas Bulk SMS a form of spam and block the messages.
– As your message is hoping all over the word, it’s more likely to get lost!

This is why we always tell our clients that you may have a cheaper source elsewhere, but check with them how they are doing this, as not sending from a local SMS gateway like txtNation, will lead you with low delivery rates, low response rates (if a two-way campaign) and paying more in the long run.

Further Reading:
See our previous post on choosing a Bulk SMS Provider.
Read more on using txtNation as your Bulk SMS Provider.

SMS Marketing Factoids

To stay ahead of the competition its all about SMS Marketing and brand awareness. With mFUSION (www.mfusion.com) (txtNation’s Mobile and SMS Marketing platform), you can ensure your mobile message is sent ‘directly’ to your target market.

• 265 million text messages sent each day
• 96.8 billion text messages were sent in 2009
• 97% of text messages are opened (83% of which are within one hour), but typically within 4 minutes
• Average click-through-rate for display advertising online is 0.11%
• Average response rate to direct mail is 2.6%
• Average response rate to SMS campaigns are 28%
• 90.4% of British mobile subscribers use their phones to send text messages
• 80% of mobile users are open to receiving opted-in SMS campaigns

Source: Mobile Data Association, Double Click, Direct Marketing Association & AOP

Further Reading:
Read more see our mFUSION site – Why SMS Marketing?

Payforit is gaining more and more traction as a mobile billing option for merchants, both on-line and on-mobile.

Payforit 4 Release

With the new release of Payforit version 4, there are many significant improvements that will help both merchants and consumers.

With it’s clear pricing and its improved ease of use there is much potential for Payforit version 4, in the UK.

Payforit 4 New Features

Several new features will be released May 15th, that include:

- Improved Payment Screens
Clean look and feel with improved design for more conversions.

- Single Click Billing
Payforit now allows for repeat user billing to be done with ease.

- Support for Payforit 4
Payforit works with regulators and merchants support in mind.

- HTML5 Payforit Payments
Payforit now offers a suitable sized payment screen for the type of browser or app.

The comparisons and debate of Premium SMS V’s Payforit will continue long into the future. At txtNation, we believe both mobile biling options will be co-exist depending on the service or application type.

Further Reading:
View our Payforit API.
Check out out page on how to connect to Payforit!


txtNation Payforit UK