How Toll-Free / Zero-Rated Mobile Data Apps Will Remedy The Ad Blocking Problem
It should come as no surprise that there is a resistance to advertisements on mobile. The engagement costs to the end-user consumer are simply too onerous -- too much distraction, too great a delay, and far too high bandwidth cost. On the last point -- high bandwidth cost -- this is actually something that is solvable by simply having the app provider reimburse (e.g., pay, reward, subsidize - choose your own verb) the end-user for the data costs associated with delivering the ad to their mobile device. In fact, ad markets can use these types of free data incentives as a way to really build up meaningful engagement and loyalty with the user base.
This can be done one of several ways: (1) Maybe the advertiser only pays for the exact bandwidth consumed by the ad itself; (2) maybe the advertiser pays for all the bandwidth consumed by the ad and the content associated with the ad (e.g., the news story); or (3) perhaps the advertiser even reimburses for the bandwidth consumed by the story and the ad, and also awards additional "surplus" data to the end-user consumer as a proper "thank you" for viewing / engaging with the ad.
It is with regard to this last scenario "3" that I think markets are heading and why toll-free / zero-rated apps will take off in the US and elsewhere. It is not much of a stretch to envision a world where end-users are rewarded this way (it's really no different than air miles or loyalty points) and it certainly empowers the end-user to pick and choose the ad, content, and free bandwidth "mix" that best matches their viewing objectives. It also creates a mechanism where advertisers need to thoughtfully compete with each other to earn the continuous patronage / engagement of the end-user (which imo is a very good thing for both the advertiser and the end-user).
Of course, there will be people that cry foul over such a free market mechanism. But their arguments will likely be based on the fact that such a free-market, transparent, and competitive system of rewarding end-users with free data takes money out of their pockets and puts it in the pocket of the end-user consumer (those same end-users who currently pay the mobile carrier for the privilege of downloading and viewing mobile ads).
Looked at another way, imagine the physical world of the IKEA paper catalog that you and I get in the mail. IKEA rightly pays the delivery cost (postage stamp) since they are seeking the engagement of the end-user. But on the Internet the end-user is the party that pays for the delivery of this same ad-based content (mostly promotional ad content). This too will migrate to the world of mobile apps and ads, it is just a question of when.
It is for these reasons that I believe the toll-free / zero-rated app will soon be making its way to our phones and will be a very welcome development for mobile end-user consumers and those advertisers who want a reliable and fair way of engaging with these mobile end-users.
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6/7/2016 | 10:49:03 AM