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    MNOs poised to reap $14bn carrier billing bonanza as they start to embrace super bundling

    Carriers worldwide are set to reap a $9.3bn bonanza from carrier billing in 2023 – rising to almost $14bn by 2027, thanks to, among other things, super bundling.

    According to the latest study by Juniper Research, this rise of 47% is accelerated by super bundling’s ability to attract new customers and revenue streams.

    Super bundling is the combining of multiple different subscriptions into one bill. Content included within super bundling frequently comprises digital gaming, music, news, video and fitness subscriptions. Carrier billing allows these subscriptions to be charged to the end user’s phone bill; rolling them into one single expense.

    Find out more about the new report, Carrier Billing: Regional Analysis, Key Verticals & Market Forecasts 2023-2027. A free sample of the report is also available for download.

    Super bundling offering new revenue opportunities 

    Super bundling allows MNOs to generate revenue from subscriptions, by taking a cut of the subscription cost. Consumers benefit from this, as they are able to consolidate a range of subscription payments with one bill, which is more convenient. These bundles are often discounted compared to the sum of the individual services.

    Additionally, a user is less likely to cancel a subscription, which is part of a larger bundle within a single bill. This will result in less churn for individual services, which will be a major benefit for subscription businesses.

    Report author Michael Greenwood says: “As traditional revenue, including texts and minutes, has been declining over time, MNOs have been keen to identify and leverage new sources of revenue. The introduction of super bundling allows MNOs to monetise third-party subscription services, creating a more profitable model, and lowering the risk of subscriber churn, by tying users more deeply within the MNOs’ ecosystem.”

    Carrier billing is well positioned for this, as it is already a proven recurring billing mechanism. Via carrier billing, subscription services can also access MNO customers, representing large addressable markets, which will be highly appealing to subscription services looking to accelerate their growth.

    According to a separate study by Juniper in conjunction with billing company Bango, the global subscription economy is set to grow by 81% in the next three years, reaching a global market value of $599 billion by 2026. Reflecting the ongoing demand for subscription services in the UK, the number of subscriptions per adult is also forecast to double, rising to 5.2, from 2.6 in 2018.

    The research identified the top three categories for subscriptions in 2023:

    • Digital Video, with a current global market value of $60bn
    • Digital Music, currently worth $41bn
    • Physical Goods Boxes (such as food & recipe boxes, or regular hygienic products) currently worth $102bn

    By 2026, it is expected that there will be over 790 million subscriptions to digital video, over 810 million digital music subscriptions, and over 920 million subscriptions to physical goods boxes.

    Driven by the continued migration of services from one-off fees to a subscription model, the report has found that this market growth is offering service providers a more efficient model for managing cash flow in the short term. This is fuelling a new market for ‘Super Bundles’, in which the management of several subscription services is centralized into a single hub for consumers.

    The super bundling opportunity

    In the context of the challenges faced by the telecoms industry — declining ARPU (Average Revenue per User) and increasing customer acquisition costs — the report finds that Super Bundling represents a clear opportunity for telcos to boost both customer acquisition and retention.

    Commenting on the growth projections for subscriptions, Sam Barker, Head of Analytics & Forecasting at Juniper Research, said: “There is one evident takeaway [from the research]: there are obvious and immediate opportunities for telcos to capitalize on this growth. This will be done by offering Super Bundling services to mobile subscribers.”

    The report explains that “Super Bundling services consist of a single payment to a telco for multiple subscription services. This will provide benefits to consumers such as easier management of subscriptions and fewer card-on-file payments throughout a billing period.”

    Anil Malhotra, Co-founder of Bango, the platform used by leading telcos to offer super-bundling, adds: “Last year, the landmark Bango subscriber survey found that 78% of subscribers want a single platform to manage all their subscriptions. Our latest research with Juniper makes clear the opportunity for telcos willing to provide that platform and help their customers manage an ever-increasing number of subscription services.

    “Some of the most innovative telco brands have already committed to Super Bundling, evidenced by Verizon’s ‘+play’ content hub in the US and Optus’ ‘SubHub’ in Australia. Through these subscription hubs, subscribers can enjoy a range of services such as Netflix, Amazon Prime, Disney+, as well as lifestyle, gaming, education subscriptions and more, all managed through a single monthly telco bill.

    “At the same time, subscription providers can reach larger audiences without the need to directly compete. The result is more choice for consumers, greater reach for subscription providers, and a potential new source of revenue and improved retention for telco brands.”

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