Earlier this year, we reported on the plans by NetZero and FreedomPop to offer free 4G mobile broadband in the U.S. over ClearWire’s WiMax network. Both companies planned to operate on a freemium basis where users get a limited amount of data each month and can buy more if they choose.
This week, a company in the U.K. called Samba joined the free broadband bandwagon with a model that’s ad-based and freemium in nature, making it somewhat similar to NetZero’s original business model from the good old days of dial-up service.
Samba users will need to pay £2.99 (about $4.65) plus packaging to buy a SIM card for their 3G-enabled device (the company is offering a Micro SIM for iPad owners). USB dongles will also be available for additional devices, though there’s no information on Samba’s site as to when customers will be able buy them.
With the SIM card in their device, users will be able to earn 3G service by watching various ads. Each thirty-second ad, selected from a grid of six ads, will earn about 3.5MB of service. Advertisers will be able to cap the number of times a user can watch a single ad – the idea being that there are only so many times a person can meaningfully absorb an ad’s content and going beyond that point doesn’t generate value for the advertiser.
Users wanting service but not wanting to watch ads (or wanting more service than they can earn from watching ads) can also pay for service in one of two ways. They can buy bandwidth directly in chunks that can be added to their account, or they can earn credit by making purchases from retail partners including Apple’s iTunes Store.
If the model proves even moderately successful, it’s reasonable to assume that companies in other countries might try to replicate it. One interesting possibility is using location-based advertising in a ad-for-service system like this. That could deliver targeted ads based on a user’s community or location, something that major retail chains could find attractive – particularly if they were able to get some data about where customers were when they viewed an ad (properly devoid of identifying information, of course). As with Apple’s Passbook feature in iOS 6, local business and regional chains could benefit from such a system just as much as major chains, if not more.