Microsoft today announced new Windows Phone partnerships for carrier billing, which lets customers charge app and other content digital purchases directly to their phone bill. In fact, the company says it is the first global smartphone platform to bring carrier billing to China, India, and Brazil.
More specifically, Windows Phone carrier billing is launching today in China on China Mobile, in India on Idea, and in Brazil on Claro. Support is also arriving on Verizon in the U.S., meaning Microsoft has finally nailed the last major carrier in its home country (it already supports AT&T, Sprint, and T-Mobile). For the record, Google beat Microsoft to the punch when it comes to carrier billing on Verizon, but Apple still hasn’t struck a deal.
Yet the bigger part of this announcement is the other three countries. While carrier billing isn’t very big in the U.S., it is crucial in emerging markets, where credit cards are not common. In fact, because the majority of people in these countries do not have (and cannot obtain) a credit card, it’s next to impossible for them to make purchases from most global app stores.
Microsoft has now partnered with 81 carriers in 46 markets, meaning it is getting close to potentially reaching half of the world’s mobile subscriber base. That being said, Windows Phone still has a small market share, so the actual number of customers that will use the feature will be significantly smaller, but the potential for growth is certainly there.
In fact, Microsoft says more than 60 percent of all paid Windows Phone transactions are already made via carrier billing. As such, this feature can be marketed heavily in these countries as a differentiator to Android and iOS.
Since the use of smartphones is still projected to explode in emerging markets (“the next five billion” smartphone customers is a common phrase that Microsoft made a point to underline today as well), even more so than it did in developed markets, Microsoft’s strategy is a very smart one. Both Apple and Google have taken similar steps, but this is one where Microsoft is clearly ahead.
The company says it has data to back up its push, which doesn’t just benefit Windows Phone owners but developers as well. New carrier billing connections increase total paid transactions by 8x per month in emerging markets and 3x in developed markets. Microsoft says it has seen an 87 percent increase in monthly Windows Phone sales year-over-year, and it believes carrier billing is a major driving force for this growth.
The feature rounds out a range of payment choices that Microsoft already offers, including credit cards, Alipay, and PayPal. Just last week, the company added support for bitcoin, although only in the U.S.
Windows Phone still has a massive mountain to climb, yet striking deals like these shows exactly why only a tech giant can provide competition to the Android and iOS duopoly. Microsoft has the global reach necessary to fight the good fight.
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