The nation's two biggest wireless carriers, AT&T and Verizon Wireless, have entered another competitive arena, this time over so-called "sponsored data," which gives customers access to low-cost or toll-free data.
In such programs, third-party vendors generally work with the carriers to offer apps or other content to customers without eating into the users' own data plans. The third parties, which can be as diverse as hotel chains or app makers, usually pay for the data that is required to use their app or service.
T-Mobile's recently announced Binge On free wireless video service seems to be about the same thing as sponsored data, except that T-Mobile said it won't charge 24 video-streaming service companies for the service.
AT&T and Verizon, instead, are expected to charge third-party vendors for access to their wireless customers.
AT&T announced its version of sponsored data, called Data Perks, in October.
Last week, Verizon confirmed in an email to Computerworld that it is working with a few partners in a testing phase on sponsored data, but offered few details. Verizon executive vice president Marni Walden told re/code, "The capabilities we've built allow us to break down any byte that is carried across our network and have all or a portion of that sponsored."
AT&T started testing sponsored data about two years ago with a plan simply called "Sponsored Data." According to its online FAQ, a customer in one example could access an application for healthcare from an insurer and click on a video, but the video would not be applied to the customer's monthly data allowance.
The more recent announcement gives users of the Data Perks app the ability to accumulate up to 1GB of free data per billing period. To accumulate the free data, users must take part in special offers from companies such as Fandango, Hotel Tonight, Rosetta Stone and others, AT&T said.
Data Perks came about in a partnership with Aquto, a company offering sponsored data services. Aquto CEO Susie Kim Riley compared mobile data to currency in a statement: "For marketers, Data Perks offers a new meaningful currency, mobile data, with which they can reward their customers."
What does it mean for customers? With Data Perks, customers earn data by taking surveys, signing up for trials or by shopping, according to AT&T. Some offers require making a purchase to earn data, while others don't.
In addition to working with Aquto, an AT&T spokeswoman said that AT&T has signed pilot agreements with sponsored data companies DataMi and Syntonic. All three companies have publicly deployed compelling use cases, she said.
"We are seeing encouraging adoption rates by users during the trials because customers respond very positively when content is sponsored," said the spokeswoman, Emily Edmonds.
"Since we launched Data Perks, we've seen a great deal of interest in this program from [third party] companies across a number of industry verticals," Edmonds added. "The program is both spurring startups and assisting exciting growth opportunities for new companies."
Other pilots are being explored.
Some net neutrality supporters have questioned whether sponsored data violates the spirit of an open Internet. But supporters of sponsored data say it doesn't normally cost users to explore offers by marketers, and the sponsored traffic is not prioritized over other Internet traffic.
The carriers, meanwhile, see benefits in customer satisfaction and potential revenues from data sponsors.
This story, "AT&T and Verizon both working on sponsored data offers" was originally published by Computerworld.