Mobile Operators Will Benefit From Direct Carrier Billing Spend

Total spend over direct carrier billing will reach $100 billion for the first time by 2025; rising from $37 billion in 2020, according to Juniper Research. The study anticipates that the increasing shift to subscription-based monetisation models for digital services such as games, video streaming and music, will be key to the market realising a substantial growth rate of 172% over the next 5 years.

The research argued that convenience of combining monthly subscription costs into a user’s monthly cellular subscription will be a key growth driver for carrier billing over the next 5 years. The report recommends that carrier billing vendors should focus on expanding their partnerships with digital service providers; enabling consumers to pay via carrier billing, capitalising on the growing trend of monetisation via subscription.

“We identified digital gaming subscription services as an immediate opportunity for carrier billing vendors. Partnering with services such as Microsoft’s Xbox Game Pass and Google Stadia will allow operators to swiftly increase their carrier billing offering by supporting payments for highly sought after services,“ said research co-author Sam Barker.

Whilst carrier billing spend on physical goods is established in the Far East, the study identified emerging opportunities for carrier billing vendors in North America. The research highlighted high smartphone penetration and accessibility of same-day delivery services as key driving forces behind a growth to $600 billion of end-user spend on physical goods over carrier billing by 2025.

However, the research warns that vendors will need to re-evaluate their monetisation models to compete with established payment methods, such as credit card and digital wallets. To make carrier billing a more appealing payment method, the study urges these players to reduce their charge rates and align themselves with established payment methods.