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New Opportunities for Mobile Content Revenue Growth

Revenues from mobile content -- monetized through direct billing by mobile network service providers -- is expected to rise from $2 billion last year to more than $13 billion by 2017, according to the latest market study by Juniper Research.

The Juniper study uncovered that network operator storefronts and portals accounted for just 6 percent of content downloads worldwide, with Google Play and the Apple App Store now comprising nearly 70 percent combined market share.

In fact, the increasing popularity of of these successful Over-the-Top (OTT) mobile device application distribution platforms had led to many operators closing their own storefronts.

However, Juniper also found that by offering carrier billing to third-party storefronts, mobile network operators could more than offset the continued decline in portal revenues.


Moreover, storefronts which have already integrated carrier billing solutions have seen a 5-6 times increase in conversion rates compared with credit card billing, together with an uplift in average transaction values.

The implementation of carrier billing allowed storefronts and independent software developers to monetize unbanked/underbanked regions and mobile device user demographics for the first time.

"While many operators have now abandoned their own-brand storefront approach, by leveraging their billing relationship with the end user they can retain a foothold in the content play," said Dr Windsor Holden, research director at Juniper Research.

Juniper believes that by offering consumers a billing choice, mobile network service provider monetization rates will rise dramatically.

However, they also cautioned that carrier billing for higher value content would be less effective amongst prepaid users -- given the relatively low top-up levels in most markets.

Other key findings from the market study include:
  • While Google has surpassed Apple in terms of app downloads on an ongoing basis, monetization levels of Android apps are markedly lower.
  • Although in-app billing and freemium has become the prevalent business model, there is still a role to play for PPD (Pay Per Download).

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