The Boku Founders Talk About Mobile Payments, Competitors and More!

I find it very hard to understand how these companies are seen as innovators, when in fact they are plugging into a system that the carriers have had in place for the past 15 years.

These companies have discovered that selling “digital goods” where royalty payments or copyright owners are not involved are really profitable if there is volume. That's the reason they stay away from payments where there could be payouts of that sort. The carriers still take 30% to 70% cut of the “retail price”, depending on what part of the world you're in. In the US for instance, it's more in line with 30% to 50% of retail price that the carrier will keep.

For players like Zynga for example it is much easier to go through a “digital goods” payments aggregator like boku, than setting up relationships with carriers one by one in every country where they operate.

However, depending on the volume of transactions they could be leaving a lot of money on the table if they don't do it themselves. Which actually is very easy to do.

I do see some very serious competitors that are already entrenched and have a better backend to avoid the carrier fees. There is a lot of innovation in emerging markets where these types of payments are much more evolved and where prepaid plans rule.

Hi Beto – I’m doing some research on this space…and it looks like you know a good amount. Any way to get in touch with you to ask you some quick questions or just get your broader impression of the boku type business model?