AT&T Allows Customers to Purchase Digital Goods with Phone Number

U.S. carrier AT&T is exploring more ways to allow mobile and smartphones to be used in transactions, with its latest move to soon allow customers to purchase digital music and movies with a telephone number. The carrier has formed a partnership with Zong, Boku, and Billtomobile to allow its customers to pay for digital goods with a mobile number rather than having to enter credit card or PayPal billing information, and those charges will appear on a customer’s phone bill.

In the past, mobile payment has not been widely adopted in the U.S. because carriers have demanded 40% of the revenue for mobile phone payment, and AT&T’s recently announced system comes with a discount of that rate, though no specifics were disclosed. With digital goods, however, the costs may be low enough that even with the higher carrier revenue split, content creators may not mind as much as they would still be profitable, perhaps banking on impulsive buying if the payment mechanism is easy enough for consumers.

Mobile payment mechanisms have been slow to take off in the U.S. in the past, but more players are now interested as technologies mature and the U.S. market being more interested in impulsive purchases, fueled by the growth of smartphones and their respective mobile app stores. Additionally, music and movies are now becoming more readily accessible thanks to mobile storefronts for those types of media, including Blockbuster, iTunes, and Amazon stores. AT&T is also partnering with rivals Verizon Wireless and T-Mobile USA in exploring mobile payments with NFC chips, though that will have to do with physical goods purchases whereas the announcement that the carrier recently made will pertain more to digital goods; with NFC chips, rather than swiping a credit card, users can tap their phone near an NFC receiver and the payment information will get read that way.

Carriers aren’t the only ones interested in mobile payment technologies, with banks and credit card issuers recently testing different technologies, including Bank of America, Visa, and Mastercard among others.

Casey Pham
Categories: Cellphones
Tags: AT&T, digital, mobile payment