BY CHISOM NWATU
New research has shown that the total value of end-user spending on digital goods through billing from carriers will surpass $74 billion by 2026, up from $54 billion in 2022.
This increase of over 37 percent is a sign of the increasing demand for carrier billing as an alternative for digital commerce spending, according to a recent study from Juniper Research.
The report also highlights that carrier billing vendors must prioritise partnerships with top gaming platforms, including emerging cloud gaming players, as a way to best serve the market interest. This direct carrier billing deals with users being charged a payment for digital and physical goods to their mobile phone bill.
Juniper also pointed out that gaming spending will account for just more than 50 percent of digital goods spend through carrier billing in 2026 as the recent research found, while their dominance will be driven by accelerating monetization tactics, including 5G cloud gaming and gaming subscription models.
The research also shows that physical goods spending is rising much faster in carrier billing than for digital goods, and would grow over the next four years at a rate of 270 percent. The report recommends targeting cross-border eCommerce vendors for partnerships, given their need to quickly onboard localised payment methods.
The research suggests that irrespective of the market growing from a lower user base, it represents a significant new opportunity as spend is set to exceed $13 billion globally in 2026.
Elsewhere, the report noted that revenue from operator-billed carrier billing that is attributable to digital goods will reach $11 billion globally in 2026, up from $8 billion in 2022 as it identified that the high costs per transaction may stand as a restraining factor for carrier billing payments versus card and digital wallet payments.
Meanwhile, identified operator reach may also be a compelling factor, the research also found.
“In the face of a rapidly accelerating digital transformation within payments, operators can be in the driver’s seat for reaching potential users, given their access to existing subscribers. Leveraging this subscription base is critical to accessing this potential revenue source,” explained Nick Maynard, a co-author of the research.