Vodafone To Allow Content Providers To Absorb Data Traffic Costs at MobHappy

by Carlo Longino on February 2nd, 2006 in Content Providers.

A recurring issue for mobile content providers and marketers is the cost end users must bear for data transfer, whether it’s on the mobile web or via messaging. It’s a particular problem in delivering content or applications to users with per-KB data plans, often adding significant cost to the stated price of the application — and an uncertain one at that.

My former colleague Justin Pearse broke the story at New Media Age last week, though that Vodafone is going to allow content providers to bundle traffic charges into the cost of their content, then take a cut of the revenues to cover the charges. This will let content providers charge an upfront, set price, or even allow for free browsing and downloads. The article’s gone behind the NMA paywall, but I’ll share some if it here (thanks Justin!):

Vodafone lets content providers charge consumers fixed price

by Justin Pearse, New Media Age

Vodafone is the first operator to launch a commercial offering for third parties to let them absorb the cost of data traffic, making browsing and download of content free for consumers, who will only pay the retail price for actual content.

This model has long been successfully used on the Vodafone Live! portal, a discrepancy which was seen by content providers like record labels as distorting the market.

“Rich media, such as audio and video, will be the next fillip for the mobile content market,” said Vodafone head of commercial partnerships Jeremy Flynn. “But a lot of current data tariffs are not 3G-centric. We’re introducing an 0800 data model that’ll be free to consumers and reverse-charged to content providers.”

Vodafone said it already had live services trialling. The service works by Vodafone zero-rating a URL so that consumers don’t pay to access content. If content providers have a fixed-size product, that’s always 1Mb, say, then Vodafone takes a cut of the revenue share. The alternative is for the operator to charge per megabyte.

Vodafone said it already had live services trialling. The service works by Vodafone zero-rating a URL so that consumers don’t pay to access content. If content providers have a fixed-size product, that’s always 1Mb, say, then Vodafone takes a cut of the revenue share. The alternative is for the operator to charge per megabyte.

This is a pretty significant move, and one that really should have happened sooner. The problem remains, though, that it only works on Vodafone for now — seeing this across all carriers would be more beneficial. But the idea that carriers will do this makes things much more straightforward for content providers, but particularly for marketers. It could also open up mobile web advertising, should it be possible to zero-rate ad servers so consumers aren’t charged to view ads.