The future for phone-paid digital goods and services

Today PhonepayPlus published a new report on the future of phone-paid digital goods and services based on research by Deloitte MCS. It suggests that operator billing could have the potential to access a total market of over £500 million by 2019, alongside other findings on the short and medium term outlook for premium rate services that will interest colleagues in the industry.

Some of the greatest potential is identified in entertainment, which accounts for over 80% of digital products and services sold in the UK. Online, mobile and tablet gaming in particular has seen huge growth in apps revenue which is set to increase further in the next few years.

The report also identifies potential opportunities in low-value goods such as ticketing, parking and transport charges.

Commission rates, investment decisions and the ability of operator billing to extend its reach in major distribution platforms are some of the commercial factors identified in driving growth. The recent launch of Apple Pay in the US is just one example of the speed and scope of the growth in payments made via a mobile device.

I recognise the changes that PRS has gone through in recent years and I want PhonepayPlus to engage with the industry on the scenarios and conclusions arising from this study. It raises challenges for many within the value chain, but also for PhonepayPlus.

As a regulator, PhonepayPlus has a role to play in supporting a healthy market as well as protecting consumers and, as I said at our recent forum for the industry, I believe the key is to regulate proportionately in accordance with the outcomes-based Code of Practice and work collaboratively with industry.

I encourage you to read the report and to consider the scenarios and conclusions outlined. To find out more, please see the full report on The Future of Phone-Paid Digital Goods and Services.