Estonia based Fortumo is known for offering in-app payments to Android developers in 70 countries. Towards the end of July, they added subscription payments to their offering. Now app developers can begin to charge subscription payments instead of asking for one off payments.
The company has already started rolling out the service with a number of games and dating sites. “Subscription payments deepen customer loyalty and have shown to increase developer revenue by at least 30%” says Rain Rannu, co-founder of Fortumo. “Recurring mobile operator billing has a potential to become a significant revenue driver for digital content merchants over the next few years.”
Where as iOS developers have been able to enjoy a well intetgrated payment environment on Apple devices, Android developers have had to work in a much more fragmented environement. This has usually resulted in lower potential to monetise and commercialise content, be it games or anything else.
The attractive part of the Fortumo offering is that while the iOS environment is based on credit cards, Fortumo works with operator billing. This means people without credit cards are also able to enjoy premium content without the need to enter the credit card details. In addition, in many cases the submission of credit cards in wrong places can be a show stopper that won’t lead to a conversion as expected.
Fortumo also emphasizes that their 69 000+ developers on board will be able to use the offering cross platform, on Android, HTML5, and iOS (through the browser). Furthermore, the mobile operator billing works with 250 operators in 70 countries. Globally, there are some 600 operators so Fortumo is able to offer their services through about half of them.
Rain Rannu, Co-Founder of Fortumo told us that while HTML5 and mobile web are growing, apps are still the biggest source of revenue for developers. Fortumo does expect this to change in 2013 though.
As to which types of apps and content generate the most money, games are the most popular. In addition to games, dating and entertainment is on the rise. Also, some operators and developers are enjoying the sales of books and music as for the first time consumers in those markets are able to consume virtual goods outside of the traditional definition of the term.
Fortumo is seeing strong growth in Central and Eastern Europe, not to forget Asia. These are also markets where credit card penetration isn’t as high as in Western Europe for example.
The company is growing strongly too, last year it grew more 200% and they are expecing the strong growth to well into the future.