Will Angry Birds Make Mobile Operators Happy?


Credit: Rovio

Angry Birds, the quirky mobile game that’s become a flyaway success in all app stores where it has built a nest, is on course for a new direction. After selling as a paid app, and then as an ad-supported free app, developer Rovio is now teaming up with operators to offer “Bad Piggy Bank,” an in-app payment service that ties in directly with the player’s mobile phone bill.

Bad Piggy Bank — initially to be rolled out on the free, Android version of the game — will let users pay a fee to remove advertising, and to buy items during the game, such as the new Mighty Eagle character.

The service points to Rovio’s wider ambitions in the market. It will first kick off in Finland with operator Elisa, but the intention is to extend it to other operators worldwide from early next year. In a joint press release, Mikael Hed, the CEO of Rovio, also notes that it will offer Bad Piggy Bank as a facility to other app developers looking for an in-app payment service.

Bad Piggy Bank will operate on a “fixed revenue share model” but Rovio and Elisa do not specify what the split will be. The back-end of the service will be provided by mobile payments company Fortumo, which already works with a number of media companies and publishers on billing for their mobile services.

A star vehicle like Angry Birds may be just what the doctor ordered for mobile operators: they have largely been cut out of the app business model up to now, and their own attempts to create a role for themselves — through their own app stores, and by getting involved in the billing side for developers — have not gotten very far. That could change with Bad Piggy Bank.

Overall, apps are expected to generate revenues of $10.9 million in 2010, according to IDC.

Rovio has said that the paid version of Angry Birds, which is sold through Nokia’s Ovi store and Apple’s App Store among others, has generated revenues of $8 million to date. The ad-supported version, meanwhile, is on course to generate $1 million in revenues annually.

Yet clearly there is still more room for revenue growth, especially if payments are tied in with enhanced content.

If anything, in-app payments may even become more significant to Rovio as the game matures, new sign-ups drop off, and it needs a new revenue stream.

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