Apple has made its first steps to offering an alternative to paying by credit card on the App Store, by testing a carrier billing option in Germany.
This is according to a German blogger called Carsten Knobloch, who noticed that iTunes has added a carrier billing option to the App Store on both desktop and mobile, for users of O2.
These O2 users in Germany can simply input their phone number into iTunes when confirming their billing option, and any App Store purchases will then be charged to their phone bill.
And the new payment method was confirmed by O2 TelefÃ³nica, who said in a statement to TechCrunch:
“TelefÃ³nica Germany is working with Apple related to carrier billing. Payment via the O2 phone bill is now available for Apple Music, iTunes, App Store and iBooks Store Purchases.
“The service is gradually being rolled out and will be available for all O2 customers (prepaid and postpaid) in Germany by the beginning of November 2015.”
This is a massive move from Apple, who have so far only allowed credit or debit cards to be used on the App Store.
Many other app stores, such as Amazon or Google Play, offer carrier billing as a payment method, for mobile users who may not own a credit or debit card.
This is one of the reasons carrier billing is an attractive payment method in emerging markets, as there are many people who do not own credit cards, and would prefer to buy digital content by utilising an existing billing relationship like their phone contract.
In 2015, in some of Europe’s biggest markets, almost 50% of people cannot pay by credit card.
For example, in Germany there are approximately 81m people and 97m mobile phones, but only 35.6% own a credit card.
As of 2015, Google Play now offers direct carrier billing in 33 countries and Windows offers it in 50.
And at the end of 2014, carrier billing was also introduced on the Amazon Appstore, and Samsung will soon bring the service to users of Samsung Galaxy Apps.
As TechCrunch noted, Germany seems to be preferred as a test market for carrier billing, with Amazon testing their carrier billing option in Germany last September.
Although the carrier billing company Apple is using was not named, reports say Apple were speaking to payment company Bango, who have worked extensively with Telefonica on Android carrier billing.
However sources have told GDI that the payment company Apple is using is Boku.
It is not currently known whether Apple plans to roll out the option in other countries, but if they do it could be a huge moment for the dating industry.
The move could enfranchise a whole new set of potential users in emerging markets who do not own credit or debit cards.
It is not currently known what the percentage of revenue split is between Apple, the carriers and the content providers, but this will likely become more clear in the coming months, as Apple further rolls out the carrier billing option.
We will update you with any further information on this exciting development.
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