Amazon’s New Billing Partner Points to Kindle Fire In-App Payments

12/8/11Follow @curtwoodward

As company “announcements” go, this one barely qualifies. Bango, a UK-based provider of mobile billing services, says it has “signed an agreement to provide services to Amazon.” And that’s that. But it actually says a whole lot.

It’s pretty easy to guess what Bango’s providing here—most likely, it’s in-app payments for the Kindle Fire, Amazon’s new color touchscreen tablet device. The Fire was unveiled in late September and started shipping in mid-November. But it’s still not a complete device, at least from a developer’s perspective.

Of course, there are hardware limitations—the Kindle Fire doesn’t have GPS, a camera, Bluetooth capability, and several more features you’d expect to find on most tablets. But perhaps more significant is the fact that the Kindle Fire’s version of Google’s Android operating system doesn’t allow access to Google Mobile Services—a suite that includes Google’s in-app payment service.

Without that capability, app developers lose a big means of making additional money on their app downloads, such as selling premium content for a game.

Amazon’s Q&A site for developers has said for months that the company is “working on a solution that will let you sell digital content in your apps using Amazon’s merchandising and payments technology. Our solution is currently in beta and available by invitation only.”

Amazon clearly needs its own in-app payment structure—why hand that over to Google when your bottom-line business is retail? But it seems a little shocking that a company already processes an ungodly amount of payments online couldn’t figure out a mobile app payment system before its new product hit the streets.

Which brings us back to Bango. The company is publicly traded on the London exchange, and a big player in mobile payments—name-brand clients include Research in Motion and EA Mobile gaming.

And while Bango’s statement on the Amazon deal was only three sentences long, Bango’s website is a font of information about its current offerings, which include payment systems that work with a user’s phone bill, a credit card, or PayPal.

Some others writing about this deal have fixed on the idea that a deal with Bango means Amazon could be heading toward billing app store purchases through a user’s monthly phone bill.

I guess that’s possible. But it seems kind of odd to think that Amazon move into the device market itself just to hand off the payments to the wireless carriers. The Kindle Fire’s wifi-only, after all. And remember, for Amazon’s purposes, it’s not a tablet so much as a portable storefront.

Bango has been expanding its footprint as well. In its recent midyear report, Bango touted its “continued product development to broaden the types of transactions passing through the Bango Payments platform, including optimization for the Android platform, development of a cloud based offering and the launch of HTML5 based products.”

I’d say it’s more likely that Amazon is using partnerships like this to build its own in-app payments system that links directly to an Amazon user account. If Amazon really wanted to fork over all that payment data to someone else, then why wouldn’t it have a Kindle Fire payments system when the product was introduced?

Curt Woodward is a senior editor for Xconomy based in Boston. Email: cwoodward@xconomy.com Follow @curtwoodward

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