AT&T's Sponsored Data is Great for Consumers, Terrible for Content Providers

Today at CES, AT&T announced a new service called Sponsored Data, which offers a way for companies to pick up the tab for 4G data usage whenever particular apps, videos, or websites are being used.  If the Sponsored Data feature is in effect, users will see a “sponsored” symbol in the status bar, and all the data charges will be redirected to the sponsoring company.

According to AT&T there will be no performance difference between sponsored and non-sponsored data and the only difference is who’s picking up the tab for the usage.  I can see this actually being beneficial for consumers, as someone who isn’t happy about data caps and throttling, this is definitely one way to “solve” the problem.  If a movie studio or a record label wants to sponsor the data I use to watch a trailer or a music video, it definitely increases the odds that I’ll watch the video on 4G/LTE instead of waiting to get home (where I may completely forget about it at that point).

Wouldn’t it be nice to watch Netflix or listen to Spotify as much as you want on 4G/LTE without having to worry about incurring expensive data fees for going over your allotted data plan?  The answer is, of course, yes.  Yes it would be wonderful.  Whether or not Spotify or Netflix will hop onboard this Sponsored Data feature by AT&T is another story though as it could get really expensive, really fast.  I could see the companies doing it as a special thing a few times a year, but not all the time.  So it’ll be interesting to see how many partners they get to sign-on.

As a consumer, I love this new AT&T Sponsored Data feature.  As a content provider though, I hate it.  I hate it because at the end of the day, the content providers are subsidizing the cost for the carriers — something I don’t think should be the case at all. Carriers are so worried about losing you as a customer, they try to get as much money as they can out of you while you’re with them.  Perhaps we should all just go carrier free?

If you ask me, carriers should be covering their own costs (without preying on content providers), offering better customer service and fair rates, and constantly be improving their network and bandwidth capabilities.  If they did that, their customers would be much happier.  Do your job, carriers.