Facebook Forges Alliance With Bango For Mobile Payments

February 9, 2012 0

Los Angeles — With recent rumors swirling around that Facebook is about to launch a mobile ad offering, and as the company foresaw its mobile presence booming, a small piece of news appeared that the social media humongous Facebook today forged an alliance with UK-based mobile billing and analytics company Bango.

Following Facebook’s S-1 filing for its upcoming IPO, this latest deal could be part of an upcoming effort to monetize social media giant’s mobile platform. The company boasts around 425 million monthly active mobile users but so far does not generate “meaningful” revenue from this sector, according to its filing. Thus, the social networking outfit has tapped Bango to help it process payments for apps, virtual goods or other mobile transactions.

Neither company revealed the terms of the agreement, but Facebook, which is in a statute “quiet period” after filing for an IPO, did not comment on the partnership. However, Bango’s board thinks it is too early in the alliance to accurately forecast the level of business which it may generate.

Bango’s technology targets the much flourishing market of internet-enabled smartphone users, who are increasingly using their devices to carry out transactions online. The company’s white-label products collect payment from mobile users for online content and services, as well as providing analytics for mobile marketing campaigns.

On the other hand, BlackBerry maker Research in Motion already employs Bango’s technology to help customers to pay for apps through their operator contracts, saving them the trouble of typing in their credit card details each time they buy an app. Bango also endorsed an agreement with Amazon in December, although details of that agreement have not been revealed.

Other clients include EA Mobile, which also incorporates Bango’s technology for targeted billing, Gameloft, for search marketing and mobile advertising, and O2 owner Telefónica UK, for real-time analysis.

According to PaidContent.org, which explains that Bango also offers analytics for mobile web sites as well as apps. The services it provides helps publishers not only track what content “works” but also can be used to build profiles to sell advertising and marketing services, it stated.

“By having the costs charged directly to a user’s mobile phone bill meaning they do not have to enter a credit card number for every purchase, Facebook members may be more likely to buy content.”

“Growth in the use of Facebook through our mobile products, where we do not currently display ads, as a substitute for use on personal computers may negatively affect our revenue and financial results,” the company noted among its risk factors.

Moreover, Bango’s technology has been optimized for browser distribution, and we see the browser as a great platform to facilitate truly dramatic growth of mobile by making apps less dependent on the handset operating system. If you want to share an app or service with others, it makes more sense to mail or tweet out a link to a web app than to try to get your friends to download apps! It seems like Facebook may have the same vision.

Nevertheless, the deal could be a positive sign that Facebook is seeking to help its users purchase apps, credits (which could change payments in Asia) and other related items on its service and have them charged directly to a user’s mobile phone bill — this could be massive when you consider the service has more than 850 million users.

Rumors are also swirling this week suggests that Facebook is planning to start inserting “sponsored stories” into mobile users’ feeds from next month. The company describes these as “posts from your friends or Pages on Facebook that a business, organization or individual has paid to highlight so there’s a better chance you’ll see them”.