In the third exclusive carrier billing outlook video series supported by Bango, Grahame Riddell, Microsoft’s Director of Carrier Billing, explains why Microsoft is standardizing on Direct Carrier Billing across all its devices.
People ask, “Why do you use carrier billing?” It is clear to see why they think this because it is more suitable to have local payment instruments in emerging markets and developing markets where credit card penetration is very low. On the other hand, in developed markets there are different customer segments that wish for alternate payment methods. Therefore, Grahame states that providing Direct Carrier Billing (DCB) to developed markets caters for all consumers, “It's about giving customers choice.” This choice is needed as consumers, “change their payment method in different times of the month, or the different types of content that they may want to purchase.”
Furthermore, the idea that DCB is suited to low ticket items which entail a friction-free purchase is not entirely true. Grahame notes that he and Microsoft have been, “pleasantly surprised by the price points that people are prepared to use carrier billing for.” In some cases, consumers have used DCB to purchase content costing up to 100 Euros in certain European markets. Moreover, Grahame says this business is fantastic for operators because they, “generate a higher revenue share from a higher ticket price item.” Therefore, DCB is a great way to, “drive OTT revenue.”
As an example, well known entertainment and music services are sometimes offered for free over a specific time period. Payment automatically defaults to DCB when the time comes for charging of the service and products. DCB in this way can be used as a promotional, marketing tool for customer acquisition and Microsoft has a global plan for offering carrier billing. For example, Grahame states that Microsoft has made DCB central to its, “overall strategy which is to empower people and organizations to achieve more… over 600 million Windows 10 devices… everything from laptops… to the big, large surface, 80-inch hub. We want to make sure when customers purchase content from different devices, it's the same consistent experience.”
Bango helped Microsoft Store initiate the process of offering DCB in 2015 and started connecting operators to its digital store. Now Microsoft is live with 37 operators across 23 countries. Grahame states that they plan to continue to roll that out globally to countries such as, “Brazil, Mexico, India… in markets where we believe carrier billing could really drive penetration and take up of that as a payment instrument within the digital store.”