Market Perspective

The confluence of broadband growth, m-commerce growth, and consumer desire for multiple services on a single bill present a major growth opportunity for both merchants and operators. This potential also presents key business challenges that require innovative and experienced business partners to solve.

Payment Friction A Major Barrier to Revenue: PaymentOne was founded on a vision to make it safer and more convenient for each and every consumer to transact online. While merchants and operators continue to deliver richer content and services that attract more and more consumers, these customers are increasingly frustrated in the final moments and requirements of purchase and checkout. Hence abandonment rates continue to soar above 50%, and 78% of consumers polled say they'd be more likely to transact online if given safer and more convenient payment options.

Limitations Fuel Abandonment and Consumer Frustrations: While credit cards were a pre-requisite for early Internet adoption and remain a pre-requisite for doing business, they continue to leave a significant amount of revenue unrealized because of material shortcomings in their effectiveness and ability to address large segments of online buyers and prospective new consumers. Studies show that one of the key reasons that 50% to 80% of all online purchase attempts are abandoned is that buyers are concerned and frustrated with providing private financial information online.

Consumers Want Safety and Convenience: A majority of online consumers continue to indicate that they would transact more if a safer, easier and more convenient payment options was offered. According to the most recent UCLA Internet Report, over 90% of respondents expressed concerns about credit card security on the Internet, increasing from prior year concerns. The inconvenience and need for the consumer to repeatedly disclose private financial information at every point of purchase, often relatively small digital content items, continues to limit a merchants full potential.

Turning Payment Into a Marketing Strategy: Leading merchants are making Payment the 5th P of marketing and an important component of a P&L owners strategy. Companies must offer a broad array of options to eliminate this friction from digital purchasing processes if they are to continue to grow and prosper. They must adopt intelligent payment solutions, strategies and processes capable of better addressing consumer preferences, increasing purchases and maximizing the profitability of every transaction.

Broadband and Mobile Providers Accelerate Content and Payment Initiatives: Broadband, IPTV and mobile networks have now further changed the landscape, Until recently, Network Operators were focused solely on their core voice and bandwidth services. But to compete and differentiate, Operators realize they must now provide broader content and value-added services to drive user retention and usage. This content-enabling "triple play" or even "quadruple play" strategy requires streamlined consolidated payment, new commerce infrastructure and financial operations expertise to effectively manage a multitude of 3rd party content relationships, settlements, risk assessment and offer management controls that are not well handled by legacy systems.

Tighter Syndication, Co-Marketing and Co-Billing Are Imperative: At the same time, broadband and mobile consumers have expectations to easily and safely consolidate digital purchases to their basic bill, and not have to consistently reenter and disclose private financial and identity credentials at each point of purchase.

In order to meet this growing market trend, PaymentOne has recently extended its long standing relationships and commerce infrastructure with Network Operators to launch its Broadband Content Network ™ (BCN ™). The BCN facilitates co-marketing and co-billing between digital content merchants and operators. By providing one of the industry's first intermediary platforms and a shared network of content providers, PaymentOne enables Operators and Merchants to effectively collaborate and rapidly co-market, cross-sell and co-bill digital services on and off the Operator's' portals.