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San Jose, California - (Cheap Web Hosting Directory) - September 27, 2005 - eCommerce merchants arelosing over $5 Billion in digital commerce revenues due to the lack of saferand more convenient payment options for consumers - according to a new study.

The 2005PaymentOne Annual Consumer Payment Poll revealed that, for the third straight year, consumers indicated a willingness to spendmore online if given safe, convenient payment options beyond credit card. Onceagain, more choice in payment options was the overwhelming driver of purchasebehavior by a six to one margin over improved content and by three to onemargin over more affordable broadband access.

Initiated by PaymentOne, the poll results were published by JavelinResearch in September 2005. The poll surveyed 2,200 U.S. consumers regardingtheir online payment preferences around digital content and services. Music,software, games, security services, subscriptions, personals, video, accessand related premium services were among the top categories of purchaseinterest according to consumers polled.

Consumers are increasingly interested in using payment options that aresafer and more convenient than credit cards:
- 78 percent of decisive consumers polled say they would “be more inclined to purchase online if given a safer, more convenient payment method than credit card;” This is up from 76 percent from a year ago and 61 percent in 2003.
- The numbers among younger consumers aged 18-34 were even higher, with over 81 percent indicating they would buy more, reflecting their desire for safer and easier payment alternatives.

Forward-thinking digital merchants are adopting improved payment strategies, and many have started to use payments as a value-add revenue driver - something very well developed in the offline world. Yet many online merchants still maintain ambivalence to the importance of payment, which is counter to actual consumer preference.

Joe Lynam, President and CEO of PaymentOne stated: “Consumers, including those with substantial disposable income, continue to tell the industry that they want a safer, more convenient way to transact online. This represents a significant growth opportunity and competitive imperative for online merchants, and unlike other major product or service enhancements, does not require up front investment.”

Despite aggressive campaigns by merchants and card companies, fraud and identity theft concerns still loom large for a significant number of consumers, and hinder online shopping growth:
- 54 percent of those polled curtail their online shopping due to fears that their privacy or financial information (or both) will be abused or stolen.
- The top concern (28 percent) is that information will be either intercepted during a transaction or accessed by unauthorized parties.

In addition to credit card holders who had significant concerns about buying online, 16 percent of consumers stated that they were not able to transact online because they did not possess a credit card.

“The major finding of the poll - that the availability of secure and convenient payment options beyond traditional credit and debit cards can drive significant incremental purchases - indicates an outstanding opportunity for online merchants to grow revenue through the introduction of payment alternatives,” said Bruce Cundiff, Research Analyst, Javelin Research.

The poll data suggests that there is a major, yet overlooked content revenue opportunity for network operators and merchants. Nearly half of consumers are willing to spend more for monthly services simply due to the convenience of using their existing billing relationship. As part of the poll analysis, Javelin calculated and PaymentOne extrapolated the potential revenue impact of this type of billing relationship: Merchants are collectively losing nearly $5.5 Billion in incremental revenue and tens of millions of potential subscribers per year In fact, by solely enhancing their payment options, PaymentOne clients alone have generated over $1.8 billion in incremental revenues and have acquired millions of new subscribers previously unreachable.

“No credit card required” payment options represent significant potential for content providers and network operators to attract more consumers: “For half a decade, PaymentOne’s flagship PhoneBill service has enabled consumers to simply charge digital services to their existing phone and broadband bills, without having to disclosure sensitive private financial information,” added Brad Singer, Vice President of Products and Markets at PaymentOne. “We are seeing more and more demand for our advanced payment platform and assessment services, which enable merchants to deploy a variety of safe and convenient payment options that better meet consumer demands and increase new revenues 25 to 35 percent or more.”

Consumers are increasingly interested in charging digital content and services to an existing trusted bill. In fact, when asked specifically which existing bill they would like to add small purchases to, consumers overwhelmingly pick their existing phone bills:
— Over 50 percent of decisive consumers would prefer to add online charges to their existing phone bills (local, mobile) instead of credit card.
— The inclination to migrate small purchases to phone, wireless, or broadband bills is particularly strong among consumers 18-34 years of age. Existing local and mobile phone bills are generally trusted, easy methods for consumers to utilize for making digital goods and services purchases.

Since phone service is considered a necessity by most, it’s one that the typical consumer will not allow to lapse. These existing billing instruments are especially attractive because they reduce the need for consumers to establish multiple, separate billing relationships, and do not require them to repetitively disclose sensitive information across multiple sites for small purchases.

For a complete copy of the 2005 PaymentOne Annual Consumer Payment Poll, please visit: http://www.paymentone.com/2005poll.

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