Google and Airtel in talks to offer 'carrier billing' option

Google is planning to partner with service provider Airtel to allow customers to pay for in-app purchases, e-books as well as other services. Google already offers carrier billing options in 26 countries including US and UK.

A tie up with Airtel will significantly boost Google's digital goods business in India. The internet giant will be able to sell its apps and digital content to Airtel subscribers without having to collect banking details.

Carrier billing allows customers to charge their digital purchases directly to their phone bills and offers a huge potential to digital goods business in a place like India where very few people use credit cards and are not comfortable making digital payments due to security reasons. Airtel has nearly 40 million data subscribers in India, with nearly 12.5 million consumers using 3G.

According to sources Google and Airtel are currently trying to come to an agreement on revenue sharing. Google is reportedly asking for 90 percent share in revenues which may be the reason for the delay. Airtel traditionally takes 50 percent of the revenue. Now service providers are changing the revenue sharing model with more profit being passed on to the developer. Vodafone recently announced a change in its revenue sharing model to 70:30 in favor of the developer.

Sundar Lakshmanan, the co-founder of Ideophone Labs, who has worked with operators for some of its apps stated, "If Airtel and Google team up, it can play a significant role in solving the payments problem."

Microsoft has also announced that it plans to launch a carrier billing solution for its Windows phone app store in India. However, the tech giant has not revealed the time frame or the service provider for the India launch.

Source: ET