Ad-supported cell phones

by on October 1, 2007 at 6:20 am in Web/Tech | Permalink

Can you stand the idea? You have to hear ads before you can make a call, of course the calls are free or at least cheaper.

This service would improve my life, as would any net per unit tax on cell phone calls, but that is hardly a predictor of future marketplace success.  Most people tolerate ads in their TV and radio shows, and indeed most of cable has evolved into an ad-supported medium.  so why ads in phone calls?  I suspect the difference is this: many viewers turn on the TV or radio to dull their senses and simply to hear voices or see faces.  Those who want more buy HBO and TiVo.  In contrast, we call on the cell phone to feel in control of a situation (am I too influenced by my experience of a teenage stepdaughter?).  The last thing the caller wants is to have that feeling of control interrupted by…lack of control.

May I presume that calls to 911 would not first be interrupted by an ad for Nikes?

People, readers, speak to me on this…

Tracy W October 1, 2007 at 7:49 am

Well when I call someone on my cellphone I want to talk to them. Now. Having to listen to an ad first would drive me nuts.

Meanwhile with the TV, an ad break provides a useful opportunity to get a drink, or load the washing machine or something.

DK October 1, 2007 at 7:56 am

Urgency is too important. Most of my calls are short but time-sensitive. if you’re trying to find someone in a crowd, ask someone who’s late what to order for their dinner, etc., do you want to wait 30 seconds? no.

Tim Worstall October 1, 2007 at 8:46 am

As Phil says, it’s a model that’s been used on landlines. The fact that it’s not become overwhelmingly popular might mean that many don’t like it.

cdeboe October 1, 2007 at 10:29 am

I don’t watch TV and rarely listen to radio, because the cost of suffering through lousy advertsing is higher than the benefit of (generally) mediocre programs. However, if teh ad was sufficient brief–three seconds? five seconds?–it might be wprthwhile.

Peter October 1, 2007 at 12:23 pm

I personally would never use an ad-supported cell phone, but then again I already go out of my way to avoid the ads on TV, radio and web pages. If there are enough people who couldn’t afford a cell phone without the ads (or might prefer to spend their money on Nikes), it may succeed.

Matthew October 1, 2007 at 1:02 pm

Well, if work wasn’t allready paying for my cell phone, I’d definitely be in on ads less than 10 seconds and probably in on ads up to 30 seconds.

Sam Penrose October 1, 2007 at 1:33 pm

Andrew Odlyzko demonstrates that the economics of person-to-person contact are very different from the economics of broadcast “content” and on that basis argues, convincingly IMHO, that people experience them very differently. I suspect he’d argue that ad-supported cellphones will fail miserably. Google his name for papers.

Tyler Cowen October 1, 2007 at 2:33 pm

Jeff’s point is a good one but I predict fewer but longer calls to Tyler, at least in a regime of ads. Hearing the ad is a fixed cost whereas a per minute charge for a call is not.

Different Jeff October 1, 2007 at 3:46 pm

Goddamn that TV stuff came off as pompous.
So the dullards watch Heroes and those seeking art and stimulation fork over 14 bucks a month to view breasts and hear the word “fuck”?

Ryan Howard October 1, 2007 at 7:18 pm

This idea represents much more than another avenue for Sears and Roebuck to tell you why you need to buy a new grill. Simply, this represents (yet another) change in the dynamic of human communication. I remember several years ago when my mobile phone was the size of my briefcase. Today, I have my mobile phone, internet, email, instant messenger, and anything else you can think of together.

This proposed plan (by Google no less) is an amazing idea. No longer would we be trapped in the AT&T and Verizon trap. I could put up with an advertisement here and there to make and receive free or reduced calls. After all, there are better uses of the money in which I send to my mobile company each month.

Furthermore, this trend of advertisements on phones opens the market to new mobile phone companies. Come on people, do I have to spell it out. A larger supply of a good…

I simply reject the idea that we could not get use to having advertisements on mobile phones. After all, if nike could shoot a laser to the moon and carve out their logo, we would all see “Just Do It” before we head off to bed. That may not be a bad idea. Some people need the encouragement.

Steve October 1, 2007 at 8:56 pm

I have used an ad sponsored Free 411 cell phone service for a couple of years. Normal 411 calls would normally cost .95 to $1.50 depending on the carrier. Unless I am in a big hurry, I have found the service to be well worth the small amount of extra time. The number for the service is (800) 373-3411.

hameed October 2, 2007 at 11:19 pm

In my mind, ad-supported cell phones would be accepted to a certain extent.
The acceptance for advertising during a call depends on some basic factors like the consumer’s income. Consumers with a higher income are usually not willing to have additional ads on phones since they can afford a cell phone and its resulting cost easier. Thus their benefit from an ad-supported cell phone is less than for a customer with lower income.
Therefore such a cell phone would be more interesting for customers with lower income. However other factors we should consider are average length of a phone call and the main purpose of phone calls. Think of a person who usually makes just short phone calls, because he prefers text messaging, email more or uses services like Listening to an ad for just a short call, where the ad-length might be longer than the call wouldn’t make really sense. The longer the ad and the shorter the calls are the less is the consumers benefit. Consequently it is unlikely that he would accept such advertising. Moreover the acceptance of advertising depends highly on the purpose of a call. For example think of a person who wants to call his family after a car accident to inform them about it and that he is ok. No one would accept any interruptions during such calls. Besides this I think the effect of the ad would be zero, simply because of a lack of awareness in such a situation.
Since acceptance and effect of advertising are related and crucial for successful impact consumers should be given the flexibility to decide whether to listen to advertising on a call to call basis. I agree with Tyler’s point having control of the situation. So if the mentioned flexibility would be integrated in such a cell phone the customer would have the full control and could choose for every call whether to hear to ads or not. Existing similar services on the internet proof that there is a certain general acceptance of listening or watching ad’s for calls. One of that is the German service called (peter pays). You can make calls from your landline phone to other phones in different countries for free. But during that call you have to watch the ad’s displayed on the screen and calls are limited to 30minutes. Even though you are not really forced to watch the ad (you don’t have to watch on the screen) it shows that there is a demand for free or even cheap calls and a willingness to accept advertising for a call.

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