How Telcos and OTTs can scale their businesses with DCB


Consumers today expect nothing less than absolute convenience. Companies are doing their best to provide the best user experience, with almost every digital service now being made accessible with just a few taps on smartphone screens.

However, when it comes to the purchase experience, the smooth and seamless user experience ususally hits a snag. Users will normally be required to exit the native app and be redirected to an e-banking website or e-wallet app. It’s a minor annoyance but companies who can eliminate even this slight hiccup can gain a crucial advantage over competitors.

In Apigate’s experience enabling e-payments for telcos and digital content providers, direct carrier billing (DCB) is one payment method that provides unparalleled ease of transaction for consumers. For digital services providers, which include over-the-top (OTT) media providers, mobile games, and apps, DCB is an unparalleled streamlined payment channel. it allows users to complete the transaction in-app by removing the need to be redirected to a third-party e-payment platform. Instead, the purchase is simply added as another item in the telco’s billing cycle to the user.

Besides an incredibly streamlined and convenient user experience, DCB enables several monetisation advantages for both telcos and content providers. Here are 3 ways telcos and digital services providers can collaborate to scale their businesses with DCB.

1. Tapping into emerging markets’s huge growth potential

A key growth segment for telcos and digital services providers is emerging markets, particularly in the ASEAN region, which is home to a population of over 600 million who is fast rising in affluence. It is estimated that over 90% of all new internet users will come from emerging markets.

A 2018 Boston Consulting Group study estimated that the total value of digitally influenced spending in emerging markets will approach USD 4 trillion by 2022. This number will certainly have to be revised with the pandemic driving digital adoption and with lockdowns causing more people to spend more time online with their mobile devices.

There is massive economic opportunity for telcos and digital services providers as emerging markets have a large subset of the population that lacks access to traditional banking facilities. DCB is perfectly positioned to provide a simple and trusted payment solution to fill this gap.

2. Single payment channel for a captive customer pool

DCB also allows digital services providers to capitalize a single payment channel with a captive customer pool. As the vast majority of consumers only subscribe to one telco at a time, there is little to no competition when purchases are made through DCB.

As such, leveraging telcos’ vast captive customer base is the most sensible way for digital services providers to quickly reach paying consumers. DCB is already the best payment technology for subscription services as it allows customers to access digital services through a convenient payment method they trust and are familiar with. Successful OTTs such as major streaming platforms as well as large international media have already gained profitability using the DCB model.

3. Marketing optimisation and revenue sharing

Encouraging customers to use the convenience of DCB for more services is an effective long-term strategy for customer retention and potentially increasing the lifetime customer value for both content platforms and telcos.

In a market where revenues from traditional mobile services are being squeezed ever so tightly, DCB allows telcos to capture a share of the revenues generated in the booming digital products and services space and optimise per-user metrics. On the other hand, as mentioned earlier, DCB also allows digital services provider to quickly enter new markets and access a large captive group of potential consumers in the form of telco subscribers.

4. Scaling strategies

Scaling can be in the form of increasing the number of markets, customers, or revenue streams. it could also be to optimise current resources, such as scaling per-user revenue. DCB can support all these strategies.

While the front-end consumer experience of DCB is unbeatable and very attractive to consumers, the back-end can be somewhat challenging. The optimal solution for telcos and digital services providers looking to scale quickly through DCB is to partner with a solution provider with global capabilities.

Talk to Apigate if you need a partner that has more than technical pizzazz. We have the business acumen to identify opportunities as well as the technology to help you best capitalise on them.