Bango Now Manages 25.6 Million Subscriptions

Bango now manages 25.6 million active subscriptions through its Digital Vending Machine, up 33% in one year.

That isn’t 25.6 million people. One customer activating five services counts as five active subscriptions. The number measures the individual subscriptions running through Bango’s platform.

It also shows how much work sits underneath something sold as one bundle.

The customer may see streaming, music and fitness included with the same mobile plan. Behind that offer, each service still has its own account, eligibility rules, activation process and commercial agreement.

Bango connects those companies and manages the subscriptions behind the package.

Bango’s first-half results show how large that business has become. Subscription revenue reached $12.3 million, compared with $13.6 million from the payments operation that Bango built first.

Subscriptions now generate nearly half of Bango’s revenue.

One Bundle Can Hide Several Subscriptions

The distributor owns the customer-facing offer. Bango’s Digital Vending Machine handles the service-level connections behind it.

A carrier can include Netflix and Apple Music with a wireless plan. A bank can add entertainment, fitness or food-delivery services to a paid account. A retailer can package several subscriptions inside a membership.

The customer signs up through that company. Bango operates behind it.

Every participating service still needs to know whether the customer qualifies, when access begins, which plan to activate and when that access should end. Adding another service creates another account and another set of rules to manage.

A multi-party bundle does more than place several services behind one price. It connects several products to one customer relationship.

That connection has to keep working after signup. A customer can change wireless plans, cancel the complete package or lose access to one service while keeping the others. Someone has to tell each subscription provider what happened.

Bango handles those connections without taking over the storefront. The carrier, bank or retailer keeps the customer relationship.

Existing Customers Are Adding More Services

Bango’s annual recurring revenue reached $20.4 million, up 31%.

Most of that growth came from customers already using the platform.

Bango reported net revenue retention of 119%. That means the same group of customers produced 19% more annual recurring revenue at the end of the period than they did at the beginning.

Existing customers contributed $3 million of net annual recurring revenue growth. New customers added another $1.8 million.

The existing-customer growth shows what can happen after the first bundle launches.

A wireless carrier might begin with one streaming service included in a premium plan. It can later add music, gaming or fitness, introduce a separate paid bundle or extend the offer to broadband customers.

The original Bango connection stays in place while the carrier adds services and activates more subscriptions.

The same applies to subscription providers. Once connected to Bango, a service can become available through more distributors using the platform.

A new bundle doesn’t always require a completely new set of connections. Sometimes it’s another combination built from companies already on the system.

Subscriptions Are Catching Bango’s Payments Business

Bango’s payments operation allows consumers to charge purchases directly to a mobile-phone bill or certain digital wallets. That business generated $13.6 million during the first half.

Subscriptions generated $12.3 million.

Payments remains slightly larger. Subscription revenue increased 13% during the first half, while payments revenue declined 5% as Bango removed some lower-margin payment routes.

Subscriptions now account for 47% of Bango’s total revenue.

Bango earns subscription revenue through platform licenses, support and implementation fees, and charges tied to subscription sales. It doesn’t need to sell directly to consumers. Bango earns subscription revenue through platform licenses, support and implementation fees, and charges tied to subscription sales. Its customers pay Bango to operate the infrastructure behind their offers.

Both Sides Want Something From the Bundle

The subscription provider and the distributor don’t join the same bundle for the same reason.

A streaming service wants distribution. Going direct gives it control over the customer, but the service also has to find that customer, complete the sale, collect payment, provide support and prevent cancellation.

A carrier, bank or retailer already has the customer and usually has a payment method attached to the account.

That existing relationship can put a subscription in front of people the service may not have reached on its own.

The distributor is buying something different.

A carrier can use streaming to make a wireless plan harder to cancel. A bank can use subscriptions to support a premium account fee. A retailer can add them to a membership program and give customers another reason to renew.

The subscription can create value somewhere else in the distributor’s business. A carrier may decide the bundle worked if it kept a wireless customer from cancelling. A bank may care more about premium-account upgrades than the margin on the included services.

The bundle’s price only shows what the customer pays. It doesn’t show what the distributor expects to gain.

The participating service gets another route to customers. The distributor gets another feature for the product it already sells. Bango provides the infrastructure connecting them.

Bundling Is Moving Beyond the Phone Plan

Mobile carriers remain Bango’s largest established market. The company says seven of the eight largest US carriers use its Digital Vending Machine.

Carriers are a natural fit. They have large customer bases, recurring bills and plenty of reasons to reduce cancellations.

The same model now extends beyond telecommunications.

Bango reported new customers outside the carrier market during the first half, adding to earlier work with retailers, benefits providers and a European bank.

Those companies can all sell bundles, but the offers won’t look the same.

One might sell five streaming services at a discounted monthly price. Another might include a service with a wireless plan. A bank could give customers a monthly allowance to spend on subscriptions. A benefits provider could let employees select from a menu of digital products.

All of them can be called bundles.

The price is only one part. Billing, activation, customer support, data access and cancellation rules determine what has actually been combined.

The distributor also has to decide whether customers automatically receive every service, choose from a menu or activate each subscription separately. Those choices affect how many people use the services and how much value each company gets from the arrangement.

The offers can look completely different to consumers and still run through the same Bango connection.

The Streaming Wars Take

Bango’s 25.6 million active subscriptions give the multi-party bundle market a useful measure of scale.

One customer can receive several independently operated services through the same signup and bill. The streaming service gets another route to customers. The carrier, bank or retailer gets another way to sell or retain its core product. Bango handles the connections behind the offer.

Existing Bango customers are adding more services and processing more subscription volume. Annual recurring revenue increased 31%, and subscriptions now generate nearly half of the company’s revenue.

Bundling isn’t simply putting streaming services back together. Carriers, banks, retailers and benefits providers can assemble completely different offers from the same types of subscription products.

The customer sees one bundle. Bango now manages 25.6 million of the subscriptions underneath it.