While having a credit card is like having a company ID in the US, not all countries have that kind of relationship with that plastic rectangle that makes you buy stuff. In India, for example, most smartphone owners don’t own a credit card, making it a bit difficult to make digital purchases. Google is trying to solve this problem by working with the country’s largest mobile operator, Airtel, to enable these users to buy books, movies and music online through the service provider.
According to sources who are aware of the negotiations between Google and Airtel, they are currently trying to settle the revenue sharing agreement, but once this is done, the latter’s more than 40 million subscribers will be able to have access to paid content from the former. 12.5 million of these subscribers are on 3G which makes them a prime target to sell these content to. At present, they are only able to use credit cards, debit cards and gift cards to pay for purchases from the Google Play Store.
But that is very limiting for those who don’t own any of the three and Google wants to change this by using the concept of “carrier billing”. This means that the payment for digital purchases will be charged directly to their phone bills. This practice has been boosting digital sales in several countries where having credit cards is not the norm. It also helps those who are wary about making online payments due to security concerns. No financial or banking information is needed when you make your purchase.
Now the only thing left to settle for the deal to push through is profit sharing according to the sources. Google normally asks for 90% of the revenues in similar situations. The carrier billing option is available in 26 countries, including the US, UK, Canada, Australia, Japan, and Singapore. Adding India to the list would be a big boost to the tech company, as it is the 2nd most populous country in the world. It is also one of the countries they targetted for their Android One, their entry-level smartphones for developing countries.
SOURCE: Times of India
