Operators helping with text donations to Japan
Using text messaging to donate funds to various relief efforts first gained widespread attention during the aftermath of Hurricane Katrina in 2005 when the Red Cross collected more than $400,000 from mobile users, and it has been growing in popularity ever since. In the wake of the January 2010 earthquake in Haiti, mobile donors raised more than $30 million to help that country recover from the devastation. And in just one month, mobile users have already helped raise more than $4.5 million for earthquake and tsunami relief in Japan. And the efforts are ongoing.
Consumers seem to find this mode of donating very appealing. According to Denver-based mGive, which powers more than 85 percent of domestic mobile donations and works with more than 500 non-profit organizations, at least 80 percent of its donors have said that their experience with mobile donations was very positive.
But what I find particularly interesting is the role of the wireless operator in these text messaging donation campaigns. Back in 2007 when mGive was formed with the assistance of Mobile Accord, the foundation negotiated agreements with wireless carriers so that they would pass on 100 percent of all donations and identify mobile donations as non-taxable items on the donor's mobile bill. But mGive's Executive Director Jenifer Snyder says that not only do the operators pass on 100 percent of the donations, they also often float the funds that have been donated by consumers before they are paid.
Donors make their $10 text donations and that donation appears on their next wireless bill. But with a 30-day billing cycle, operators often don't receive a payment for more than 30 days beyond when the donation is made.
Snyder says that at least three top tier U.S. operators are currently floating donations to Japan to make sure those in need can get aid as soon as possible, even it if means that they haven't been paid for those donations yet. "They are absorbing the risk to make this happen," Snyder said.
So in a world where big telecom operators are often scorned for their not-so-consumer friendly policies, such as early termination fees, it's nice to know that some companies are willing to take a risk, particularly when it means getting help to people who desperately need it. -Sue