© THINKTANK International Research 2010 Report prepared for PhonepayPlus Current & future market for Premium Rate Services February 2010 © THINKTANK International Research 2010 Contents 1 Methodology...........................................................................................................................................................6 1.1 Qualitative research ..............................................................................................................................................7 1.2 Quantitative research ............................................................................................................................................8 1.3 Market sizing methodology ...................................................................................................................................9 2 Introduction & definitions ...................................................................................................................................10 2.1 Definition of PRS as regulated by PhonepayPlus...............................................................................................10 2.2 Taxonomy of premium rate service activities ......................................................................................................11 2.3 Consumer language for premium rate services ..................................................................................................11 3 Market overview, 2009 .........................................................................................................................................13 3.1.1 Industry and value chain...............................................................................................................................14 3.2 Recent mobile developments..............................................................................................................................14 3.2.1 Smartphones and internet access................................................................................................................14 3.2.2 Mobile advertising.........................................................................................................................................15 3.3 Future developments ..........................................................................................................................................16 3.4 Consumer attitudes - barriers and drivers...........................................................................................................17 4 Premium Rate Payment mechanisms ................................................................................................................20 4.1 Premium rate lines ..............................................................................................................................................21 4.1.1 Consumer attitudes ......................................................................................................................................21 4.1.2 Likely market development...........................................................................................................................22 4.2 Premium SMS .....................................................................................................................................................23 4.2.1 The market in 2009.......................................................................................................................................23 © THINKTANK International Research 2010 Contents 4.2.2 Consumer attitudes ......................................................................................................................................23 4.2.3 Likely market development...........................................................................................................................25 4.3 Paying on the mobile internet (including Payforit)...............................................................................................25 4.3.1 Consumer attitudes ......................................................................................................................................26 4.3.2 Likely market development...........................................................................................................................27 4.4 Red Button ..........................................................................................................................................................27 4.4.1 Consumer attitudes ......................................................................................................................................27 4.4.2 Likely development.......................................................................................................................................28 5 Other payment mechanisms ...............................................................................................................................29 5.1 Credit and debit cards .........................................................................................................................................30 5.2 Stored value/pre-paid cards ................................................................................................................................30 5.3 Online payment systems.....................................................................................................................................31 5.3.1 PayPal ..........................................................................................................................................................32 6 Premium rate service areas ................................................................................................................................33 6.1 Directory enquiries ..............................................................................................................................................34 6.1.1 Consumer attitudes ......................................................................................................................................34 6.1.2 Likely developments .....................................................................................................................................36 6.2 Information services ............................................................................................................................................36 6.2.1 Consumer attitudes ......................................................................................................................................37 6.2.2 Likely developments .....................................................................................................................................38 6.3 Call Services .......................................................................................................................................................38 6.4 Adult Entertainment.............................................................................................................................................39 6.4.1 Consumer attitudes ......................................................................................................................................39 6.4.2 Likely developments .....................................................................................................................................40 © THINKTANK International Research 2010 Contents 6.5 Competitions .......................................................................................................................................................40 6.5.1 Consumer attitudes ......................................................................................................................................40 6.5.2 Likely developments .....................................................................................................................................40 6.6 Flirt, dating and chat (non-sexual).......................................................................................................................41 6.6.1 Consumer attitudes ......................................................................................................................................41 6.6.2 Likely developments .....................................................................................................................................41 6.7 Gambling, betting, lotteries and scratch cards....................................................................................................41 6.7.1 Consumer attitudes ......................................................................................................................................42 6.7.2 Likely developments .....................................................................................................................................42 6.8 Mobile games......................................................................................................................................................42 6.8.1 Consumer attitudes ......................................................................................................................................43 6.8.2 Likely developments .....................................................................................................................................43 6.9 Purchases of other entertainment content for mobile phones.............................................................................44