Why ESPN could pay for data use by wireless customers

ESPN wants to make it easier for its app users to stream data-chugging video.
Written by Tyler Falk, Contributor on

Streaming video on your smartphone can make a major dent in data usage. With wireless carriers in the United States putting monthly caps on the amount of data you can use to connect to the their networks, companies that focus on video and other content that clogs broadband networks could be losing out on potential customers.

But at least one company has a plan to get around that, to the likely joy of consumers, Wall Street Journal reports:

ESPN, the cable sports channel majority-owned by Walt Disney Co., has had discussions with at least one major U.S. carrier to subsidize wireless connectivity on behalf of its users, according to people familiar with the matter. Under one potential scenario, the company would pay a carrier to guarantee that people viewing ESPN mobile content wouldn't have that usage counted toward their monthly data caps.

Why is ESPN specifically looking into this model? Mobile traffic is booming and their most popular app, Watch ESPN,  streams live sports. Daily mobile Web traffic has more than tripled, according to WSJ, from 3.2 million in 2010 to more than 10.3 million this year. So it would make sense to invest in the data used by its viewers to make sure there isn't a sharp drop-off in users and ad revenue at the end of the month when wireless customers reach data limits.

ESPN Eyes Subsidizing Wireless-Data Plans [Wall Street Journal]

Photo: Flickr/ramseymohsen

This post was originally published on Smartplanet.com

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