Fortumo this week launched what it calls hybrid subscriptions using carrier billing, according to a press release.

Hybrid subscriptions enable merchants to provide access to content on a limited time basis in low-income markets, according to the announcement. Fortumo's new product is intended to complement its subscription payments solution (available in more than 20 countries globally) in regions where recurring billing has proven to be ineffective and where carriers have not enabled it.

“People living in countries like India, Thailand and Nigeria can access online content but cannot pay for it due to the lack of credit cards," Martin Koppel, CEO of Fortumo, said in a statement. "The pricing of this content is often mismatched with local income since most users cannot afford a $9.99 subscription for 30 days. Merchants we work with have found success by going local, for example by charging 49 cents for daily or $2.49 for weekly access. This means hybrid subscriptions with carrier billing give merchants a single technical platform to adapt their business for local market conditions and consequently grow their revenue."

With hybrid subscriptions, users select a time duration for content access and then pay for it on their phone bill. This means streaming merchants like Spotify or Netflix can enable daily or weekly access to entertainment with scaled pricing, significantly increasing the number of users who can afford to make payments, according to the announcement. Fortumo's recently published Emerging Markets Payment Index indicates that in the fastest growing emerging markets, the average payment for digital content is well below $1; this makes the existing pricing logic of most digital merchants unsuitable for many markets.

Hybrid subscriptions feature an automatic purchasing power parity engine which assesses spending patterns across 350 mobile operators connected to Fortumo, according to the announcement. While the merchant is setting up their payment service, the engine gives recommendations for hybrid subscription pricing and duration which has proven to be effective for each carrier. Pilot merchants using hybrid subscriptions are seeing approximately 1.6 times higher payment conversion from hybrid subscriptions compared with regular one-off payments, according to Fortumo. 

Fortumo's hybrid subscriptions product is intended for music and video streaming companies, digital newsstands, Web and server hosting providers, social networks, dating sites and other merchants whose existing business model is based on recurring payments, according to the announcement. Hybrid subscriptions are available to merchants across all 88 markets that Fortumo covers through one-payment integration. Fortumo also provides recurring billing using mobile payments in more than 20 countries, among them Brazil, France, U.K., Sweden, Romania and India.