Telefonica teams with tech giants for carrier billing

‘Direct-to-bill' agreement

Facebook, Google, Microsoft and Research In Motion (RIM) are teaming up with European mobile carrier Telefonica in a deal that will let customers pay for digital goods as part of their phone bills. This means that customers will have the option to pay for apps and in-app purchases such as virtual goods from RIM’s BlackBerry App World, Google Play, Windows Phone Marketplace and Facebook in their monthly Telefonica bill. The ‘direct-to-bill’ agreement is designed to simplify the process of making payments on mobile in order to boost app revenues.

Mobile payments are an important part of the business model for mobile web developers, but today the options are too complicated for users,” says Facebook partnerships VP Dan Rose.

This is not the first time these firms are offering operator billing, with Facebook and RIM already partnering with payments firm Bango. Facebook has also just launched a new service that makes it easier for mobile operators to collaborate with third-party app developers to let their customers pay for in-app goods and services as part of their phone bills.

Telefonica is upping its game in the mobile payments space, participating in payment app Boku’s USD35 million funding round last year. The firm says this latest agreement will help drive downloads for paid digital content, particularly in developing markets, where credit card penetration is lower. Telefonica claims that direct-to-bill trials are already proving successful in Latin American markets where up to 60% of adults do not have bank accounts. The firm is rolling out the service across Europe and is planning to bring it to 14 markets by the end of the year.

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