AT&T’s Wi-Fi experiment: Watch ads, get access

Remember the old NetZero(s untd) dial-up Internet plans that gave you free Internet access as long as you put up with an advertising window emblazoned across your screen? Well, AT&T(s t) is experimenting with a similar concept at Dallas-Fort Worth International Airport, only it’s offering up an access technology that these days is in far greater demand: Wi-Fi.
Starting in September, any of DFW’s 57 million annual passengers will be able to access AT&T’s Wi-Fi hotspot network free of change in the airport’s five terminals, but they’ll have to watch a 30-second video ad for every 40 minutes of web surfing they do. Not a bad trade, considering a one-off session at a U.S. airport these days can cost as much as $10.
AT&T hasn’t yet specified whether the free service will be available to smartphones and tablets as well as laptops. An AT&T spokesman said the company is still working on the details. The decision, however, will likely depend on whether those non-PC devices can render the video ads AT&T will proffer.
So far the trial is confined solely to DFW and required special permission from the airport’s board of directors to implement. AT&T made it worth their while: It’s expanding its hotspot coverage and capacity to more areas of the terminals, as well as blanketing parking garages and other parts of the grounds. AT&T is likely assuming it will get a lot of takers for the service, and it’s probably right.
These days, it’s not too hard to find free Wi-Fi in many urban locations, given the number of businesses and residents that open their networks to the world. But airports, conference centers and hotels are major exceptions, and those venues take advantage of their captive audiences by charging exceptional rates. If AT&T expands this pilot to other parts of its 30,000-strong hotspot network, then it could have a game-changing business model on its hands.
AT&T currently sells Wi-Fi access for $20 a month nationwide and offers session-based access for $4 a pop. It’s doubtful AT&T is charging advertisers $4 to show a few 30-second videos, but by making the service free to use, AT&T could also attract a lot more users to its network, giving those advertisers fistfuls of impressions.
There could be a dark side to this little experiment as well. While there’s little downside for the innumerable non-AT&T customers that would otherwise be forced to pay for Wi-Fi access at DFW, AT&T has millions of smartphone and home broadband customers who already get free access to Ma Bell’s hotspots. The AT&T spokesman said AT&T hasn’t yet decided whether that no-strings-attached access for current broadband customers will continue in the confines of DFW.
One of the main reasons AT&T has pursued Wi-Fi is its usefulness as an offload technology, sparing its cellular networks from data overload. This experiment may signify that AT&T is looking for a way to monetize that Wi-Fi traffic.
Airport image courtesy of Flickr user Michal Osmenda