Verizon Says ‘Sponsored Data’ Plan May Include NFL Games
Verizon unveiled a new “sponsored data” plan called FreeBee on Tuesday that will allow customers to consume data, including videos and app downloads, without taking a hit to their monthly data caps.
While other phone carriers, notably T-Mobile (TMUS), have been offering their own sponsored data plans for some time, the Verizon (VZ) one, which will use a bee icon to tell customers data is sponsored, is notable for a few reasons.
First, unlike T-Mobile, companies that want content to be included in Verizon’s plan will have to pay for the privilege. In some cases, this will involve website owners paying Verizon to sponsor data for their own content—an arrangement that Verizon’s VP of Consumer Products, Colson Hillier, compared to free shipping.
And in other cases, the sponsorship will consist of marketers paying to display their logo against a piece of third-party content such as a video or a song. This option raises some intriguing scenarios.
“One use case is sponsorships,” Hillier said in a phone interview. “If brand X wants to sponsor an NFL or NBA game, instead of tattooing their name on a halftime show, they could sponsor the data.”
WATCH: T-Mobile customers can enjoy free streaming without eating up data:
Hillier added that while Verizon currently partners with the NFL for mobile distribution rights, no such sponsored data deal is in place, but that the company is open to the possibility. Right now, Verizon customers can stream NFL games live for free (the company recently dropped its $5 fee) but, given the bandwidth it takes to do so, they risk burning through their monthly data cap in short order.
Hillier also said that Verizon is also exploring ways for marketers to sponsor other “high affinity” content such as popular TV shows.
All of this is consistent with a strategic shift in which phone companies, as mobile streaming surges, are looking to charge both customers and content providers for data.
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It remains to be seen how all of this will fly with the FCC. Currently, the agency is talking to T-Mobile , AT&T (T), and Comcast (CMCSA) about how their sponsored data schemes square with “net neutrality” rules that prevent Internet providers from favoring some types of content over others. Verizon’s FreeBee promotion will no doubt attract attention as well.
Such regulatory scrutiny may be why Verizon says, for now at least, it will not automatically include its own content under the FreeBee program. Recall that the phone giant recently came to control a mass of media content through the acquisition of AOL but, according to Hillier, the AOL properties—such as Huffington Post—will have to pay market prices if they want to sponsor data.
All of this is taking place under the shadow of a major legal challenge in which Internet providers are claiming the FCC’s net neutrality rules are unlawful. The D.C. Circuit Court of Appeals, which heard the case in early December, is expected to rule in the near future.