SMS Billing Popularity Sky Rockets in the USA

Most iGaming sites accept major currencies such as US dollars, GBP or Euros. Deposit and withdrawal methods include credit cards, wire transfer, Neteller, instant check deposit and Money Gram and premium SMS.

According to GlobalAdultBilling.com, 65% of the world does not use credit cards.
In addition, many people are concerned about the possibility of charges for erotic or gaming services appearing on their credit card statement or simply have security concerns about submitting card details over the Internet.

Premium SMS for 2 Billion Mobiles
While the majority of the world either doesn’t use credit cards, or doesn’t have a bank account (even in the USA, 1 in 12 adults do not have a bank account), there are over 2 billion mobiles. Currently, Premium SMS is used to bill mobile subscribers for services such as chat, dating, downloads of wallpapers and ringtones; and for micro-billing.
Micro-billing allows users to pay for third party SMS, WAP and WEB content by sending an SMS to a short code and in return receives either the content directly (for immediate SMS content), or a pass code to log into the WAP or WEB site where the desired content resides. SMS micro-billing has a number of advantages over credit card and premium-rate voice billing:
- It can handle small payment amounts.
- Almost anonymous payment processing (only the mobile phone number is known to the content provider).
- Widely available to mobile subscribers worldwide.
In Europe, establishing a viable payment model for mobile gambling is proving difficult – especially in countries with large numbers of pre-paid customers where the cost of a download or a bet can be the whole value of a top-up card.
Ate Online notes that in Italy, 85% of customers are pre-paid, with 82% in Portugal, 47% in France and 50% in Germany .
In addition, even pre-paid phones are often configured to decline adult and gambling transactions, so the available customer base is seriously reduced.
The reality is that gaming and gambling developers are very much at the mercy of operator billing systems. According to Stephen Carl of Vodafone’s Global Charging and Payment division, “Right now there is a theoretical £5 transaction threshold on WAP transactions for gambling and gaming for both post and pre-paid.”
This is not a technological limitation, but a regulatory issue. Operators also feel constrained by the European Union’s e-cash directive – known in the UK as the Financial Services and Markets Act 2002. This directive states that if the value of the purchase is not downloaded to the handset as content, it will require the billing agent to have a banking license, and Financial Services regulation1.
In order to subscribe to a gambling service using Premium SMS payment, your mobile service provider may require you to disable the “adult content filter” that is installed on some handsets. Also, socially responsible mobile sportsbooks require disclosure of age verification details that can be checked against public records.

Case Study: txtNation
txtNation is a solutions provider across billing, content and mobile messaging platforms .
Focusing on sophisticated, “plug and play” solutions designed and supported by knowledgeable technical and customer support teams, txtNation has proved itself to be one of the most efficient and cost effective messaging, billing and content providers in the business.
With a global reach, and strong partnerships, txtNation can facilitate mobile messaging services and products across the Americas, Europe, Asia and Africa. The company currently serves over 7,000 clients, large and small.

mBILL
mBILL allows clients to sell products and services through mobile devices. The worldwide txtNation platform can bill Premium SMS in over 40 countries, handling mobile transaction security, telecom protocols and regulatory compliance requirements.
Premium SMS solutions charged through mBILL offers the option of either using a cost-effective shared short code or the brand flexibility of a dedicated short code tailored to client specifications.
This integrated platform can be deployed as a “plug and play” solution within an existing ecommerce system.
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An iGaming client would use mBILL in the following scenario:
- User texts/SMS in to deposit funds/place bet.
- User receives confirmation on purchase.
- You can choose from $0.50 to $10.00 typically per message per country.
- Each country has its own rules on billing amounts and what companies can and cannot bill for (payouts also typically differ per country).
- APIs connect to sites/services to enable this transaction and payout to occur.
- Some offer a full pay model, where the user payouts are higher for the opportunity to use their mobile.
- Some offer less credits based on mobile purchases.

There are many options. From premium and non-Premium SMS, one-way billing, to billing through an automated phone call.

mBILLin ASIA
Asian customers have regional characteristics, including different patterns of betting, product preferences and account settlement practices.
A large portion of this market does not have credit/debit cards, or in some cases, bank accounts. Trust and brand loyalty are the keys to success in this controlled and regulated environment .
In addition, in many developing nations, mobiles outnumber fixed landlines.
While many Western casino operators do not have direct relationships with clients in Asia, mBILL has contracts with China Mobile and China Unicom to connect clients to over 425 million mobile phone users in China, the fastest growing economy in the world and home to the so-called “Second Industrial Revolution”. China has 416.64 million subscribers (31.7% penetration) and two main networks. With a massive mobile user base and huge potential for growth, it is equally home to a massive digital revolution.

mBILLin Latin America
Post UIGEA, many gaming companies have begun to aggressively establish a presence in Latin America. However, this region has low levels of credit card penetration and few alternative payment solutions.
In addition, many payment processors and banks will not work with gaming operators if they lack local licenses, which is a lengthy, cumbersome process to obtain.
In Central and South America, increasing numbers of players are using their mobile phones to purchase their lottery tickets in state-run sweepstakes.
Interoperability issues between wireless networks in South America have prevented companies in this market from realizing the scale of SMS revenues being generated by their counterparts in Europe, where many countries have begun deriving a significant share of their national telecom revenue from the one billion-plus SMS messages sent monthly.
Ignacio Aguero, general director at Argentinean sportsbetting operator, Formoapuestas, noted, “Payments methods are important in this respect. In South America, people do not like to put their credit cards over the Internet. After you have created the culture where people want to gamble, you have to enable them to. You have to give them the right tools to do it securely and easily ”.
txtNation has established connectivity with local language support into the networks of South America, enabling txtNation clients to deliver micro-payments for Web-Based Access (mENABLE), content services (MPUSH) and a wide variety of other SMS revenues from text messaging across Mexico, Argentina, Bolivia, Chile, Columbia, Ecuador, Peru and Venezuela. Brazil will be added to the network later in 2009.
Currently, txtNation delivers both one and two-way SMS services for clients across all major network standards in the Americas, including GSM, TDMA and CDMA.

SMSPayment Solution
Thus, Premium SMS is an affordable solution for increasing a gaming operator’s global customer acquisition, improving loyalty and establishing trusted brands and awareness through direct, personal, accessible and immediate communications.