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January 06, 2014

AT&T Launches Sponsored Data Service

AT&T has launched a “Sponsored Data” service that content or application partners can use in a way similar to “toll free” phone numbers.

With the new Sponsored Data service, data charges for participating apps and services will be billed directly to the sponsoring company, much as Kindle content downloads have been paid for by Amazon, directly to AT&T.

Speculation about toll-free data usage began to surface in the spring of 2013, when it was reported that ESPN was talking with at least one service provider about using such a service to encourage mobile users to consume ESPN content on their mobile phones.

Of course, most users have learned to switch to Wi-Fi connections as a way of achieving the same advantage (no mobile data plan consumption), but the new AT&T plan presumably would encourage people to consume ESPN content without waiting to find a Wi-Fi connection.

ESPN, for example, has gotten data from at least one big mobile service provider showing that significant numbers of mobile users reach their monthly cap before the end of the month, after which their usage drops off, as subscribers try to avoid overage charges.

A Sponsored Data capability presumably would prevent that from happening, allowing ESPN and other content providers to maintain engagement without concern over users reducing usage because of data caps.

The Sponsored Data program extends that concept, allowing business partners to encourage usage, as mobile customer data plans are not charged for usage.

The Sponsored Data apps and services will be delivered at the same speed and performance as any other content, on a best effort basis, with no packet prioritization.

AT&T believes the program will be attractive for partners in industry verticals including healthcare, retail, media and entertainment and financial services, to encourage sampling of new apps that otherwise might strain data plan allowances, especially video apps such as movie trailers and games.

If users are able to browse mobile shopping sites without incurring data plan charges, that likewise should encourage usage of the sites offering the feature.

For business customers, the feature might be a way to support essential work-related apps without necessarily subsidizing all other consumption.

Edited by Ryan Sartor

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