Sponsored Data – Take off or Write off?


According to a recent article in FierceWireless (here) by Phil Goldstein, despite the distinct lack of success of “Sponsored Data” AT&T CMO David Christopher says that the carrier is still “very bullish” on the program.

Sponsored Data still a go at AT&T

AT&T CMO David Christopher still “very bullish” on Sponsored Data

AT&T introduced the Sponsored Data service in January 2014 (here) with the anticipation of creating a new revenue stream.

AT&T’s new ‘Sponsored Data’ service opens up new data use options for AT&T wireless customers and customer-friendly mobile broadband channels to businesses that choose to participate as sponsors. 

The announcement indicated that service would be primarily aimed at vertical markets with the opportunity to better engage with customers and employees.  Some of the stated potential innovations included:

  • Encouraging customers to try a new smartphone or tablet app.
  • Promoting movie trailers or games.
  • Providing patient healthcare support via wellness videos.
  • Encouraging customers to browse mobile shopping sites.
  • Allowing businesses with ‘Bring Your Own Device’ policies to pay for the data employees use for specific business-related apps and services.
  • Enhancing customer loyalty programs by providing sponsored data access to products and services.

Fast forward one year…  This week AT&T announced that Kingsoft’s WPS Office will offer Sponsored Data for U.S. users.  This takes AT&T’s Sponsored Data customer count into double figures.  The customer base so far is a motley crew of niche players:  Aquto, Liberty Mutual, Macheen, Wazco, DataMi, Syntonic Wireless, LotusFlare, HipCricket, WPS/Kingsoft and Screen Media

Despite the lack of runaway success, AT&T is still upbeat about the prospect.

Christopher said the company is actively talking to more companies about Sponsored Data deals but declined to say which ones. “This is a gestation period,” he said. “Sponsored Data is a really unique capability that I think is going to manifest itself in really interesting ways over time.”

There have been some critics of the 1800-data concept.  Dean Bubley was characteristically candid about the prospects of 1800-data at the time of AT&T’s launch.  Dean’s post on his Disruptive Analysis Blog (disclaimer: I am an avid fan) laid out ‘why “sender-pays” is a pointless, misleading or maybe even dangerous metaphor to use’.  Check out - Sender-pays” is a ridiculous 19th-Century idea misapplied to the Internet.

The Sponsored Data service does seem to be niche at best. There are also many technical and philosophical question around how the service actually works.  I would suggest that rate of change in mobile data pricing alone, is enough to severely hamper efforts to market and sell this service – really tough find enough value for customers.

Having said all that, maybe the initial customers will feel they have gotten their money’s worth just out of the free publicity surrounding the lack of momentum for the service?

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