Wireless operators turn an eye to the personal data business

BARCELONA—A company that owns a group of sports venues was approached by a large wireless carrier with an interesting proposition. The wireless company was already going to install a set of cell signal amplifiers in the stadiums, but the operator offered to also sell the stadium owner certain data about the people who were using the network in the stadium. The data would come from the databases of demographic and behavioral information the operator kept about its subscribers.

If the stadium operator knew certain facts about the people who were at the venue, it could know what ads and promotions to show to them during the game. If the stadium owner knew, for example, that 60 percent of the crowd were males in the 35 to 47 age range who had a tendency to shop for Ford trucks, the stadium might show Ford truck ads on the scoreboard, charging Ford megabucks to do so.

This is the new business that some in the wireless business believe represents the future for wireless operators, sources here in Barcelona tell me.

The phone company would essentially become a Big Data company that sells a certain unique package of data to anybody who could use it to target ads. Would-be customers include anyone from banks to websites to car dealerships.

The phone company might know, for example, the demographic data on the group of subscribers who drive on the interstate near a certain cell tower. The owner of the giant billboard sign sitting near that section of interstate, somebody like Gannett, could use that data to decide what ads to post there.

Wireless companies are in a unique position to gather a lot of personal information. We have our mobile phones on us almost all the time, and we do a lot of things on them that identify us and betray a lot about our tastes, habits and desires. As we carry our device around with us during the day, the phone company can track our locations very closely as we move from cell tower to cell tower in the network. This is just the stuff that advertisers and marketers crave, and they´ll pay a lot of money for it.

In the interactive advertising business, hundreds of big data companies collect their own special mix of personal preference and demographic data. An interactive ad agency might detect a pixel on your browser as you visit a site, then match that pixel with the one associated with a data set about you in some big data company´s database. Then the web advertiser knows who you are and what you like, and can target ads at you better.

This might be the wireless companies’ next big business. Both Sprint and Verizon have already started divisions that offer clients this sort of data. The carriers are taking a very measured approach to offering this sort of data, similar to what Web companies like Facebook and Google have done. They want to offer marketers meaningful and actionable data, but they don’t want to violate the privacy of their customers. So they sell data in an aggregated form that never identifies individual users by name, email address or IP address.

The carriers may need a new revenue line in the future. In the US, only the largest carriers are making large profits selling wireless broadband contracts and subsidized phones, but over-the-top voice, video and text service may eventually threaten those margins. These pressures increase the possibility that Big Data could be the next big thing for wireless companies.

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