A major opportunity for wireless operators is to position mobile devices as “payment engines” — especially in areas of the world where credit cards are not widely used. Which makes the move by PayPal to enable in-app purchasing on iPhone and Android devices a bit of a hit to operator ambitions in this area. It’s somewhat surprising that Apple and Google are OK with this as well because they both have their own payment systems in iTunes and Google Checkout, respectively.
Android blog AndroidTapp has the details:
PayPal will allow in-app purchases in Android Market and iPhone App Store apps (Apple even approves). Offering an alternative to traditional purchasing options, you will be able buy apps without a credit card. This can alleviate some countries not able to purchase apps as Paid Apps must be purchased via Google Checkout which only accepts debit, gift, and credit cards. Available in the second quarter 2010 with support in U.S., Canada, U.K., France, Italy, Netherlands and Australia.
Connected Planet’s take,
Susana Schwartz:
Does the fact PayPal powers application purchases on Android and iPhones mean losses for CSPs? If someone other than the phone company is the payment provider, doesn’t the phone company lose two valuable things, revenue and eyeballs?
With all the hype around Telco 2.0 and the “two-sided business model,” it seems the telcos should be capitalizing on these new devices to take a piece of the estimated $26 billion in revenue that telcos potentially could garner from offering billing and payment services to “other players,” whether OTT players or other vertical industries.
Billing and the systems that enable it are the value proposition that telcos bring to the table in emerging models, as they already have the billing, customer care, CRM and other management systems, as well AAA functionality and policy and subscriber management capabilities that others lack.
Rather than re-invent the wheel where others already have the rims, spokes and rubber in place, how about leveraging what you’ve already got and get your brand in front of as many eyeballs as possible — especially on platforms that will be as prevalent as iPhones, Androids and whatever else they think up?
That’s our take on this. Let us know what you think in the comments section below:
The issue to me seems that wireless carriers have abandoned their aspirations to offer Content Managment Delivery Systems because Android & Apple platforms offer customers what they want & telcos don’t have to deal with issues concerning reconcilation with App providers, relevant content etc. Telco’s are now focusing their attention on using their CRM, billing, AAA functionality etc to offer pricing models to consumers according to time of day, usage patterns and event possibly shaping traffic patterns/users to benefit customers who utilize partners that the telcos have preapproved to deliver various content. There is also the push to have targeted profitable content which will be delivered on telco customer’s devices in partnership with content providers that are willing to share revenue.