Ad blocking isn’t the only route to revenue for telcos.
Sprint-owned Boost Mobile announced Tuesday that it had inked a deal with Unlockd, a mobile platform that helps telcos reward subscribers for viewing ads on their lock screen.
It’s a move that’s nearly the opposite of Caribbean carrier Digicel’s arrangement with Shine to block ads at the network level as part of a longer-term plan to enter into revenue-sharing agreements with large digital players like Google and Facebook in exchange for letting their traffic through.
But rather than blocking ads, Boost is embracing an ad-funded model.
The lock screen is a prime piece of real estate, considering users unlock their phone an average of 150 times a day, said Unlockd CEO and co-founder Matt Berriman. Millennials unlock their phone roughly 200 times each day.
Unlockd works behind the scenes by licensing its technology to wireless providers. When users wake up their phone and enter their password, they’re presented with ad content on their lock screen which they can either interact with or dismiss.
Boost is white labeling Unlockd’s tech to power Boost Dealz, an Android app that knocks $5 off a user’s monthly bill as a quid pro quo for engaging with brands.
In addition to Boost, Unlockd is also working with Australian carrier Lebara, which provides its users with two free gigs of data per month for looking at ads on the lock screen. A soon-to-be-named UK carrier is using the solution as well, said Berriman, who noted that Unlockd is also in advanced discussions with a number of agencies, including Starcom, IPG and Amnet, Dentsu’s trading desk.
“Mobile has been and will continue to be a priority for us,” said Justine Watkins, managing director of Amnet Group US, which is testing Unlockd’s offering on behalf of clients as an “engaging way to reach today’s constantly connected consumer.”
The value prop for carriers is churn reduction and increased brand loyalty – issues that are particularly acute for a prepaid carrier without annual contracts.
“You have to regain that customer base every month because they could stop paying at the beginning or the end of any cycle,” said Doug Smith, director of prepaid product marketing at Sprint Telecom. “But by lowering the cost, we believe customers will stay with us longer and bring us more value over time.”
But rather than pocketing the fruits of the new ad-based revenue stream generated through Unlockd, Boost is investing some of that money back into the customer relationship.
Unlockd maintains direct relationships with a stable of advertisers, including Starbucks, Lyft and Levi’s, and manages all the ad inventory for its partners through direct deals and private marketplaces.
The ads are pre-cached to cut down on latency and frequency capped so users don’t see one every single time they unlock their phone. The ad content is programmatically served through Unlockd’s platform, which taps into targeting parameters like geolocation, device ID, age and gender.
Although Unlockd also leverages carrier and advertiser data to target ads, Berriman said the company has no plan to sell any data it collects to third parties.
In Boost’s case, when users download the Boost Dealz app, they’re presented with a brief sign-up process during which they’re asked to select their areas of interest from a long list of categories, which also informs the targeting.
It’s a classic value exchange, Smith said. Engage with brands, get $5 off your bill, plain and simple.
“People within our company have come to me multiple times and said, ‘We could put ads here or there and derive a revenue stream from that,’ but we know from talking to our customers and doing surveys that our subscribers don’t want to be forced to watch an ad just to get a service they’re already paying for,” he said.
For that reason, ad blocking at the carrier level à la Digicel doesn’t much appeal. “My goal is to pass value on to our subscribers, the ones agreeing to view ads,” said Smith, who stressed that he couldn’t speak for Sprint as a whole.
Unlockd also announced Tuesday that it’s integrating Yahoo search into its platform and partnering with MoPub, Twitter’s ad exchange. “We’re all working together as part of a shift in the macro market that’s more than just a one-off opportunity,” Berriman said.
Founded in 2014, Unlockd is headquartered in Melbourne, Australia, with additional offices in New York and London. The headcount stands at around 15, which the company expects to grow to 40 by February. Unlockd raised $15 million from a buffet of backers in October, including News Corp. co-chairman (and Rupert Murdoch spawn) Lachlan Murdoch.
