This month the Indian telecommunications industry was stirred up by a big leap forward. India’s 3rd largest mobile operator Idea launched mobile payments on Google Play. This launch brings all mobile operators in the market significant new revenue opportunities but also creates new payment related challenges.
Google Play’s launch has caused two significant changes to the carrier billing ecosystem in India. First, Google pays developers 70% of the end-user transaction (a global industry standard, also used by Apple and Microsoft). This means the commercial terms for carrier billing in India have now reached the industry standard 70-30 split, partly also thanks to a different approach to taxation described on Medianama.
Besides app stores, such conditions make carrier billing much more attractive also for global digital streaming merchants who cannot go with standard terms as their business model includes paying royalties to rights owners. With improved commercial terms, carrier billing could now also support the business model of companies like Pandora, Spotify, Netflix and Hulu.