Revenue sharing is one of the solutions used to be taken by telecommunication companies to reduce the cost of telecommunication infrastructures. Telecommunication companies could do revenue sharing with manufactures (vendors) and application developer (Content Provider- CP). Competition on telecommunication business is very tight. Telecommunication companies should have brilliant idea and attractive innovation while they plan to launch a telecommunication product and service. Poor innovation on the product and service will produce poor response from mobile telecommunication subscribers. In others word, they will lose on such tight competition.
Beside, idea and innovation on telecommunication product and service, telecommunication companies also need to consider how they will invest the telecommunication infrastructure to support many telecommunication services. Revenue sharing will reduce the cost they should invest to deploy telecommunication infrastructure and faster while launch the telecommunication service. Revenue sharing used to happen on the telecommunication service which utilized application developer such Value Added Service (VAS) such as BREW service, Ring Back Tone (RBT) service, download content service e.g. ringtone, wallpaper, game etc.
Telecommunication companies will split the revenue to the three parties who involve on this telecommunication service. The percentage of revenue sharing is depending on the agreement between telecommunication companies and three parties. Telecommunication companies should receive higher than three parties involved and could be more than 50% such as on Ring Back Tone (RBT) service
The more benefit of revenue sharing is telecommunication companies used to did not maintain the telecommunication infrastructures which involved directly to the service. Usually, three parties managed directly to the telecommunication system. Revenue sharing is really giving more benefits to the telecommunication companies