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UK, German Android-ers can buy apps on phone bills

Vodafone is the first domino to fall

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Vodafone will be the first operator in Europe to add the cost of apps to the phone bill, signing up with Google Marketplace to offer the service in the UK and Germany.

Vodafone customers with Android handsets will be able to have the cost of applications added to their bill, or deducted from their prepaid balance, with the intention of selling stuff to those without credit cards as well as increasing the barriers to entry for Marketplace competitors.

Vodafone started offering its own channel in the Android Marketplace last month, recommending the operator's top 25 Android applications. That runs alongside the Vodafone Shop, an online portal which is just about all that remains of the much-hyped "Vodafone 360" offering.

The billing relationship an operator has with its customers is still valuable, even if it's not as valuable as Vodafone's CEO thought it was in 2007. Operator billing not only allows customers without credit cards to buy applications, and make purchases within applications, but it also discourages customers with credit cards from handing the details to Google and thus maintains the operator relationship.

For Google, operator billing encourages use of the platform, while making alternatives such as SlideMe or Amazon's app store more complicated to use.

The complexity is in the prepaid market, where credit has to be reserved during download, then deducted after installation. That complexity has discouraged operator billing in markets where credit card ownership is near universal, but now that Vodafone has started it seems likely the other operators will follow. ®

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