What is sponsored data? Free data in exchange for promotional content

The French operator Orange will be introduced into Spain a new marketing tool that has had great support in America. In this article we tell you what is the sponsored data or “sponsored data.” The mechanism is simple, and consists of allowing customers to browse content sponsored by other commercial brands for free. More than two years ago, the American operator AT&T presented the sponsored data. Later, they joined Verizon and T-Mobile in the American country, although the sponsored data has a presence in almost the entire continent of America, and is currently in the testing phase in France, Germany or India and it seems that Spain will be the next to jump on the bandwagon. The subsidiary of the French operator wants Spain start incorporating this innovative system. Orange has chosen our country as it is, by far, the most profitable market for the group, just after France. For now, only two companies have made a deal with Orange: Privalia, an online sales platform; and the American firm Datami, dedicated to digital marketing. Thanks to the sponsored data, brands manage to deliver their promotional or advertising content both through their websites and with their own apps, making it possible for users browse for free without spending the megabytes they have. It is the sponsored companies that pay Orange for this data, without the user having to pay extra at any time. Being the Mobile World Congress the first contact, Orange is starting to test it with some users. Ferran Güell, CMO of Privalia, expressed his opinion on the agreement with Orange. “70% of Privalia sales are already made through mobile devices and we are exploring new ways to improve the service and experience of our customers in such a strategic channel”, commented Ferran Güell.

America, pioneer in sponsored data

Although it is just over two years old, there are already positive examples of applying this technique, such as, for example, the Brazilian bank Bradesco. The entity was overwhelmed by the number of people who were crowding, creating long queues at the branches. So they launched the campaign Free Bradesco Cellular Access, which allowed customers to access their accounts from their mobile, without having to pay extra for data. Bradesco's move helped them to be able to Double its customers in two years, and it seems that now it will be Telefónica that wants to try its luck in the South American country. Through its subsidiary Vivo, it will test the sponsored data with brands like Privalia, Mercado Libre or NetshoesThe Spanish multinational will also try to enter other South American countries, although it seems that they will not export it to Spain for now.

Net Neutrality

Since AT&T will present the sponsored data in it CES of Las Vegas In 2014, many doubts have arisen regarding its implementation, although net neutrality stood out above the rest. In short, sponsored data represents a competitive advantage for large companies, which will be able to make agreements with operators, leaving the smaller ones in a lower position. sponsored data can therefore become a double-edged sword, where the smallest is at a disadvantage. For example, let's imagine that Netflix reaches an agreement with Orange to be able to consume the entire offer of the American channel for free, leaving no chance small companies or startups to be able to compete in this field. One of the first detractors was Public Knowledge, an association that seeks to protect network neutrality. “The company that connects you to the Internet should not be in a position to control what you do on the network. AT&T has just announced that it will do so.”, Public Knowledge stated on the sponsored data. In short, the sponsored data This can be a great help for users, as they will be able to access some pages completely free of charge, creating a fairly strong loyalty among them. The problem would be that the big companies would end up taking over (more) the territory of the smaller ones.

What is your opinion on sponsored data?

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