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Editor’s Blog – 15-05-15: Treading carefully in the PSD2 world

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Skeldon2014BWHello and Happy Friday! So it looks like the PSD2 is to exempt charge to mobile for voice services, charity donations, digital content and ticketing when it is put before the European Parliament in July. Phew. That will certainly make it easier to start to market the power of charge to mobile to many new vertical markets.

But, while it takes a lot of the uncertainty out of how selling these particular services is going to be impacted by regulation (in case you don’t know: exemption from PSD2 means these things are NOT going to be regulated as if they are payment services, but will be regulated by the more accepted telecoms regs) there are still issues over how they could be put into place. And moreover what the cost of doing that could be.

While there are only nascent digital content and ticketing markets – and charity donations are something of a law unto themselves – there are still concerns over the impact of the limits placed on charges that can be accrued with voice services that are vexing the telemedia industry.

If the PSD2 exemption is green lighted, as we now firmly expect it to be, then one off charges for charge to mobile will be limited to €50 and monthly spend per consumer on all charge to mobile will be halted at €300. And this could be problematic.

For starters there is confusion as to what this actually means. Is it €50 for one service and that’s you lot per day? Or can you do loads of €50 transactions until you hit your €300 limit?

While the wording is really obtuse, what it actually means is that you can spend €50 per transaction up to a max of €300 in any calendar month. So you can, for example, buy two tickets to see The Who for €50 each on the same day as long as its through two different services. Or you buy them through the same service on different days. But. if you then buy four more on the next four days or through four different services taking your total spend to €300, then you will be up to your monthly limit and can then not use ANY charge to mobile service until the following month.

In the here and now these limits could have huge impact on the small but dedicated number of users of what were previously known as premium rate services. Many could easily rack up these kind of charges in much shorter time frames. And I am not talking adult here, per se, but many mainstream services.

Directory enquiry services are a prime example. Not only could these limits mean that someone calling them a few times in a day gets cut off and then can’t use them if they hit the €50, it could be that many people will simply be unable to use them for the last week of the month as they will have hit their €300 limit. Not good.

Looking more to the future, if charge to mobile for content, ticketing and more takes off then you could very easily find that, in say a year’s time, people can’t actually use this payment mechanism as they will hit their limit sooner and sooner. In fact, the more successful charge to mobile becomes, the more it could see people hitting their limit way before the month is out.

This is concerning many in the industry across Europe and negotiations are underway (and it could be the sticking point that sees the rumoured PSD2 exemption hit the wall at the 11th hour), but there is a note of caution. Many out there are calling for voice to be pulled out altogether from PSD2 – from the exemptions or otherwise – so that it isn’t hamstrung by these limits. But there is a real danger that this could lead to even worse regulation of voice services.

While there is much to celebrate in the rumour that PSD2 exemptions will make charge to mobile finally fly we still have much careful work to do.

And you can find out more about PSD2 and what it means in the grand scheme of mpayments and the MPayments summit and Telemedia UK event in London on 9 June. Sign up here.

We will also be doing more in depth analysis of what it all means in the new look Telemedia magazine. Sign up here.

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