Next Generation Wireless Applications: Creating Mobile Applications in a Web 2.0 and Mobile 2.0 World, 2nd Edition

15.8 COMMERCIAL CONSIDERATIONS

Whilst mobile services might offer many exciting possibilities technically, it is important that they offer commercial possibilities to match. The good news is that the mobile channel is already a merchandising channel and has been for some time. It is already possible to use the mobile channel to distribute content and receive payment. Of course, the value chain is invariably occupied somewhere by the mobile operators and they will want to take their cut. The costs here will appear as a revenue share that the operator will take from the micro-payments made for content. Nearly all micro-payment schemes possible, such as reverse-charged (premium rate) texts are implemented via the operator's billing platforms and utilise a direct financial relationship with the operator's customers. Money flows out of the micro-payment infrastructure as payouts to the billing aggregators who exist to buffer service providers from having to deal directly with all the operators (which often they won't accept anyhow). Payouts from the aggregators then flow back to the media companies less the aggregator's margin.

Micro-payment margins are only one element of the cost base associated with service delivery. Users have to access the services in the first place and this requires data transfers across the network. All data flows have to be paid for and the operator will not subsidise these costs unless part of a wider agreement with the media company. In the absence of such ...