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In Wireless First, AT&T Says It Is Ready to Offer "Toll-Free" Data

So-called sponsored data allows companies to pick up the bill for use of a specific service or app.


After indicating for two years that it was interested in such a service, AT&T is announcing Monday its plan for “sponsored data,” in which businesses can pick up the bill for consumers using certain apps or services.

For consumers, it’s the data equivalent of making a toll-free call with the business providing the service picking up whatever number of megabytes are consumed.

AT&T is launching the service Monday, with sponsored content expected to begin showing up during the first quarter.

While new to U.S. cellular customers, Wi-Fi providers Gogo and Boingo have been offering similar options. On Virgin America, for example, visits to eBay are free to the consumer, with the online marketplace figuring having a captive shopping audience is worth the cost of underwriting the service.

Facebook also worked with a number of wireless carriers overseas to offer customers free access to the social network as part of its Facebook Zero program.

Among the first to sign up to use AT&T’s sponsored data service is United Health Group, which plans to use sponsored data to deliver educational videos and other healthcare info to its members.

Businesses could also use the option to pay the data cost of workers’ use of certain apps in cases where employees typically pay their own cell phone bills.

One of the concerns around cellular carriers offering sponsored data is whether such services may get priority, but AT&T says sponsored content will be delivered at the same speed and performance level as non-sponsored data.

AT&T had said since 2012 it was interested in offering the service, but had to do a bunch of work on its end to make the service possible, with some help from Amdocs and Ericsson. Also, sponsored data only works on one of AT&T’s fastest two networks (LTE or HSPA+) so it had to also make sure customers in nearly all areas could get one of those two services.

The carrier also said the option to sponsor data will be available to anyone that is interested, with the only requirements being to adhere to guidelines put out by the Mobile Marketing Association and CTIA-The Wireless Association.

Sponsored data is just one of several things that AT&T is announcing Monday as part of a developer forum it holds annually in conjunction with CES. The company has promised to talk more about its in-car efforts, among other things. Stay tuned for more updates from that event, which is just getting underway.

Update, 9:35 a.m. PT: Well, that didn’t take long.

Consumer group Free Press is out with a statement condemning the new option as a bad idea.

“Caps are supposed to help wireless carriers manage congestion,” Free Press policy director Matt Wood said in a statement. “But if getting a big check from another company suddenly makes AT&T’s congestion concerns go away, that shows data caps aren’t necessary in the first place. Caps are merely another way to pad AT&T’s profits.”

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