Mopay LogoBoku Logo

US-based carrier billing solutions provider Boku has acquired (pdf) Germany-based competitor Mopay for an undisclosed amount. Following this acquisition, Boku will have a presence in 80 countries and claims that it will reach close to 5 billion customers.

Both Boku and Mopay have a presence in India. Boku entered India in November 2013 by acquiring Qubecell, and Mopay launched its operations in India in May 2014 with an HTML5 in-app billing solution. Boku supports payments from Airtel, Vodafone, Idea, Tata Docomo, Loop Mobile, MTNL and Uninor, while Mopay had claimed that its direct carrier billing platform will be available “on all large Indian carriers”.

This deal will bring together a number of valued content companies on a single platform, including Valve (makers of DOTA), Gameloft, and Wargaming from Mopay and Facebook, Sony, Spotify, and Electronic Arts from Boku’s existing set of clients. The integration of Boku and Mopay’s systems is expected to be completed by the end of 2015, when both systems would be on a single platform.

It’s worth noting that Boku used to power Facebook’s mobile payments in India, though that didn’t last for long. Online video streaming service Spuul had also tied-up with Boku to enable operator billing option for Airtel, Vodafone and Idea Cellular customers in November last year.

Other players: Estonia based mobile payment provider Fortumo had setup its Indian office in New Delhi last year. The company had signed agreements with four Indian telcos – Vodafone, Airtel, Idea and Tata Docomo – in September 2013 to extend its direct carrier billing solution to India. Ver Se Innovation had also launched its carrier billing platform called iPayy in September 2013. It had initially partnered Idea and Airtel, and currently claims to support 5 carriers but hasn’t disclosed the names. In November 2013, Rome-based mobile payments firm Neomobile SpA had also tied-up with Vodafone and Airtel to launch its Onebip mobile payment service in India.

Issues with direct carrier billing in India: There’s no refuting the fact that the operator billing space has a huge potential in India. However, revenue share ratio between the service provider, the telco and the merchant is turning out to be the stumbling block. For example, telcos charge Fortumo 40-45% per transaction, Fortumo takes a 2-3% commission as transaction fee and the remaining goes to the merchant. Just compare this to the 70-30 split that has become almost the norm on mobile app stores. Ver Se had told Medianama that in their case operators receive 30%, iPayy gets about 5% and the rest goes to the merchant/developer. That seems like a much better deal. It’ll be interesting to see if the telcos budge from their revenue share position in the coming days or if they remain adamant.

Also Read: On making Carrier Billing independent of Carriers in India