Wireless Providers might take a Shine to New Controls over Mobile Advertising

by Matt Klassen on October 17, 2014

With technology companies occupying more and more of the telecom industry’s traditional territory it’s no wonder wireless providers are feeling like little more than “dumb pipes,” providing the network framework on which the tech industry makes its money but really seeing none of the profits. To this point, in fact, wireless providers have had no recourse against this seemingly inexorable shift, watching their roles shift from the kings of the communication market to nothing more than faceless data middlemen.

Whether it is mobile payments, advertising, or even the voice and text communication the wireless industry was built on, tech companies have found a way to deliver such services to their customers using the providers’ wireless networks, but otherwise cutting them out of the process (and associated revenues) entirely.

But if perhaps you were feeling sorry for those beleaguered wireless providers, an Israeli start-up named Shine Technologies may have offered the telcos their first real weapon in fighting the tech companies, creating AdSight, a product that allows carriers to monitor (and block, if need be) advertising being delivered over their network; the only hitch, it may conflict with Net Neutrality.

By utilizing Shine’s AdSight technology, one that allows carriers to selectively block ads on browsers and apps running on their respective networks, carriers presumably will be thrust into the centre of the mobile advertising market, once again holding the keys to their networks. Regaining such control, analysts believe, will allow carriers to barter network access (which in this case means access to customers) for a piece of the pie in some sort of revenue-sharing model.

The one problem with this plan, though, is that AdSight stands in stark conflict to the FCC’s Net Neutrality standards, as it’s exactly the sort of arbitrary blocking and throttling that the rules were established to prevent.

While Net Neutrality still remains in a state of flux itself, the prevailing message from the FCC is that service providers do not control the information that flows through their networks, and by blocking or otherwise preventing advertising from moving across the network seems like such a violation, at least on the face of it.

Although it certainly doesn’t help the case of wireless providers that this move is nothing more than an attempted cash grab by companies that has seen their roles steadily diminish, analysts believe that there may be some defence for this action, seeing blocking or otherwise monitoring advertising as nothing but prudent network management, allowable under the current Net Neutrality rules.

The problem, carriers will likely argue, is that there are some ads that really gobble up data allotments, particularly ones with video, which is itself both detrimental to the end consumer and the network itself. By monitoring and restricting the flow of such content, the argument will be, carriers are better managing their networks and providing better service to their subscribers (until the advertisers pony up the cash of course)

That said, it’s doubtful the FCC will buy such an argument, as after decades of endless power plays and unquestioned control over the Internet, there are few who are feeling sorry for the telcos and the other service providers, meaning the providers are going to have to find another way to monetize their networks lest they remain nothing more than “dumb pipes”.

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Written by: Matt Klassen. www.digitcom.ca. Follow TheTelecomBlog.com by: RSS, Twitter, Facebook, or YouTube.

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