You're The Product, Not The Customer - AT&T To Introduce "Sponsored Data"

Jan 6 2014, 1:33pm CST | by

You're The Product, Not The Customer - AT&T To Introduce "Sponsored Data"
Photo Credit: Forbes Business

Be careful what you wish for, it might just come true (with a healthy dose of Starbucks advertising along for the ride).

We all moan about the cost of mobile data – seemingly for those of us used to free WiFi being fairly common, we’re starting to expect that our mobile data should be similarly gratis. Ever looking for opportunities to differentiate in the cut throat and threatened telco space, AT&T is delivering on this desire and is announcing a new “sponsored data” service in which organizations can cover the cost of mobile data for particular applications or services – likely in return for ramming obnoxious advertising down our throats.

The model is similar to what in-flight connectivity providers have been doing for awhile – I remember being excited on a flight last year when I could surf Facebook for free, and then frustrated that anything of value was outside of the free option. Virgin America also offers free visits to eBay (but one assumes, no similar approach to in-flight eBay shipment delivery).

First to sign up to the AT&T offer is United Health Group who is going to deliver “educational videos and other healthcare information” to users.

However not everyone is happy with this move. ABC News reports that the communication rights advocacy group Fre Press is worried. Policy Director Matt Woods was concerned that the move would lead to double dipping by telcos:

Given that consumers pay for a “bucket” of data every month and very few exceed it (AT&T says only a small percentage does), they won’t actually save any money through the service. Meanwhile, the sponsoring companies are paying AT&T for the new sponsorships. In addition, there’s no possibility for any oversight of the charges and fees. It’s ripe for abuse and double-charging,

Concerns have also been raised about the impacts sponsored data will have on consumer internet usage. The suggestion is that consumers will tend towards viewing sites that they can access for free and hence will have negative impacts on the breadth of access. IN yet another example of homogenization of information, users will tend towards sites that can afford to pay for sponsored content, and away to those that cannot afford to do so. Unless of course we start to see the Library of Congress sponsoring data in which case there’s a fair case to be paid for the positive impacts of the program as millions move away from Candy Crush and on to more intellectually high-brow content types.

This sort of offering is very much a taste of things to come – expect to be offered up free mobile surfing with a banner-add for an ab-flexer some time soon…

Connect with Ben on Twitter @benkepes | LinkedIn AngelList

Source: Forbes Business


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