Octegra has released a white paper (White Paper) claiming that direct-to-bill payments provide the best revenue results for both operators and content owners.

Octegra’s research found that premium SMS purchases primarily benefit the mobile operator, who receives 45% of the revenue, with the content owner getting only 14%. In credit card payments both groups lose out, with the operator getting a 25% cut, and content royalties only forming 12%. In this scenario the third party billing provider scoops 33% of the total revenue.  The white paper identifies direct-to-bill payments as the fairest and most profitable method, giving the operator a 27% share, and content royalties forming 30% of revenues.

“The present mobile content business demonstrates zero sum game behaviour, in which revenues are restricted and the operators’ gain is perceived to be the content owners’ loss,” said John Moroney, author of the white paper from Octegra. “As a result, there is little cooperation between these two sides of the industry, with both operators and content owners creating their own mobile portals. Consequently operators building portal services have to pay inflated prices for content, and content owners building off-portal sites have to pay the operators up to 50% of their revenues.”
The report was commissioned by mobile payments service company Valista.
According to the white paper the five parts of the mobile content value chain are Taxes, 3rd party billing providers, portal promotion expenditure undertaken by the content owner, content royalties and operator charges.