Updated: 5/16/2006; 4:20:26 PM.

Digital Development
Communications and info tech in developing countries, especially wireless broadband and high-value applications

daily link  Thursday, September 02, 2004

New Ideas for Emerging Markets: Cellphone micropayments for the BOP:  For cell phone operators, "mature markets [are] near saturation, and carriers must develop new strategies to reach low-earning customers. Carriers in emerging markets often find quick early success by catering to customers at the upper end of the local income scale, but at some point, they have to start looking a little lower down. While they'll still go all-out over those top-tier customers, operators must also figure out a way to remain profitable at the low ARPUs generated by low-income subscribers. ..

Smart Communications in the Phillipines and several other Asian carriers have proved, raising subscriber figures and revenues by letting users refill their prepaid accounts with electronic micropayments.  Smart users used to have to buy refills of a minimum of 100 pesos (about $1.75), but the lower limit is now just 30 pesos. .. Now, users buy the smaller refills from one of Smart's 500,000 resellers across the country, who then updates the user's account with an SMS.

The smaller refill amounts, along with the negated need to print scratch-off refill vouchers, cut Smart's costs by 300 million pesos ($5.3 million) in its first six months and helped the company add a record number of subscribers in the second quarter. Indonesian carrier Indosat is also using the electronic micropayments, and says it will add more subscribers this year than it first estimated since the system helps attract new lower-income users."

  12:12:20 AM  permalink  

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Copyright 2006 © Ken Novak.
Last update: 5/16/2006; 4:20:26 PM.