Tesco Mobile launched a new service in the UK this week that promises to reduce users' mobile phone bills in exchange for viewing different types of content, promotional offers and advertisements when they first unlock their Android smartphones.
The service, called Tesco Mobile Xtras, is an Android app based on a platform from Australia-headquartered company Unlockd, which recently raised AUD15 million (€9.8 million/$11 million) in a series A funding round. This is the first launch of the service in Europe; Unlockd has already secured deals with Sprint's Boost Mobile unit in the U.S. and Lebara Mobile in Australia.
Tesco Mobile users with Android smartphones will be able to download the app and get £3 (€3.83/$4.33) off their monthly bill in return for viewing content and ads on a total of 21 days within a month. The content appears when the user unlocks their device. Unlockd said it owns the IP "whereby the unlocking of a device is the trigger that serves digital content onto the display of a device."
Tesco Mobile said the content would depend on a customer's age, gender and interests and include items relating to health and fitness, beauty, home and gardening as well as news and special offers.
Tesco Mobile was also quick to dispel concerns that users would have to wait for a promotional message to be cleared before making an emergency call: "You don't have to unlock your phone to make an emergency call," the company said.
However, the operator noted that the Xtras app does interfere with the clock and alarm on "a small number of devices, and we're working on a fix right now."
Importantly, Tesco Mobile is also providing 200 MB of free data a month to ensure that data allowances are not used up by the content that is served through the Xtras app. The app will also only work when the user is on a Wi-Fi network when roaming abroad.
The move certainly comes at an interesting time for mobile advertising in general: Three UK recently said it would trial ad-blocking technology on its network later in June and is among a number of mobile operators looking at strategies to deal with what they see as increasingly intrusive advertising on mobile phones.
Ernest Doku, telecoms expert at uSwitch.com, commented that whether or not mobile users are willing to live with ads in return for cheaper bills will depend on how intrusive and how relevant the ads actually are. He also noted that the savings are far from generous:
"Another tick in the box is that brands won't be able to access or buy users' personal mobile data but, on the flip side, a saving of £3 a month barely covers a coffee these days," Doku commented.
Unlockd said the service helps operators to find new revenue streams; helps advertisers have first access to consumers on mobile devices before Facebook and Google; and helps customers reduce their phone bills.
Three UK to trial ad-blocking technology in June
Report: Google exploring policy for 'acceptable ads'
MWC panel highlights tension between ad blockers and the mobile-ad ecosystem
Juniper Research: App advertising to reach $44B by 2020
Three deploys Shine ad-blocking technology in UK and Italy