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Phone Billing Uncovered

Phone Billing Uncovered

November 7, 2008
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" Contrary to popular belief, phone processors ... do not dictate the end-user costs "

With so many different online billing methods available, the world of processing — the most crucial element of the value chain — can sometimes be a confusing place.

In broad strokes, if you operate a paysite, it is important to cherry-pick the best processors in their respective fields, and offer them all. After all, the more ways a prospective customer has to pay you, the better — both for them, and more importantly, for your bank balance.

One form of billing that should definitely be featured as part of your processing portfolio is telephone billing — not least since the phone is so ubiquitous. There are now more cellphones in my home country of the UK than there are people!

This article aims to help give you a better understanding as to how this particular form of billing works, so that you can make an informed choice when deploying it.

Contrary to popular belief, phone processors like us and others involved in this space do not dictate the end-user costs — the various phone companies worldwide with whom we have interconnect agreements do.

This is why the outpayments vary from country to country. In all those markets that support domestic “premium rate” billing, these numbers are served to surfers at the cost of which, as the name suggests, is charged at a premium and collected by the surfer’s phone company, which, in turn, then pays the company with whom you have an agreement. These then retain their margin and pay the balance to you, the webmaster, whose content initiated the call in the first place.

Since the telephone remains an essential utility to most people, chargebacks are practically unheard of since they tend to pay their bills in full. However, as with mobile, the U.S. is one notable exception — Americans are not legally obliged to pay the 1-900 element of their phone bill. Thankfully, the credit card still reigns supreme here, which is why I actually advise clients not to employ phone billing in this particular country.

Thankfully, the world is a big place and the Internet, being the world’s first truly international medium, allows you to make money on a global scale with this kind of billing.

It is important to bear in mind that when comparing rates from the various processors, all is not as it first appears. A case in point would be when comparing the outpayment rates for Switzerland, which supports up to 5.55 Sfr per minute, but we bill at 4.23 Sfr/minute instead.

Some processors automatically elect to serve the most expensive premium number available in each country, thus at first appearing to be offering the best rates. This strategy can, however, be counterproductive since it can be an instant “turn off” for most prospective customers. We believe it is far better to employ more realistic price-points where possible so that surfers are far more likely to pick up the phone to pay you!

Note that the vast majority of countries throughout the world do not support domestic pay-per-call billing. In such cases, the surfer is invited to make a regular IDD (International Direct Dial) call in order to receive their password. The telco of the country to which the call is made understands that this is effectively “new money” and thus is prepared to pay a portion of the so-called settlement rate that phone companies worldwide use to pay one another. We pride ourselves on offering the highest international outpayment rates within the industry, allowing you to make money from markets such as the huge emerging growth economies of Brazil, Russia, India and China.

Whilst credit card billing is and remains the best way to charge for monthly subscriptions, phone billing is a great way to charge for lesser periods of access time. The bottom line: phone billing will add to yours!


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