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Tuesday, June 30, 2009

Germans Get Cheaper Cell Phone Service In Exchange for Ads

Stacey Higginbotham

AL_logo_205pxAlcatel-Lucent said today that it’s begun providing German carrier E-Plus with equipment that inserts advertisements onto mobile devices based on demographic information provided by a subsidiary of the carrier. Customers opt in to the service and in exchange get extra minutes or texts on their cell phone plans. Gettings, the E-Plus subsidiary collecting the information and delivering the ads, offers plans that send between 10-25 ads per week. When customers sign up for the program they are asked to indicate via a checklist topics that interest them so they are subsequently delivered relevant pitches.

Will this become a high-quality targeted advertising effort similar to the ads delivered by Google based on search, or will this sort of advertising instead remind users of the experience offered back in the late 90s when ISPs such as NetZero offered free dial-up in exchange for irritating pitches? If the experience is unobtrusive and the incentives are right, I can see plenty of younger subscribers signing up, and merely accepting ad-based mobile service as the way to do things, much like we do today for search. That could change the business model around low data-rate mobile services such as texting and voice calls, to one in which carriers offer them for free or at reduced rates to folks that accept ads.

As an opt-in program, presumably people will understand what exactly they are giving up, making this less underhanded than other planned mobile advertising schemes. However, it’s still an invasive form of advertising.