Wireless carriers like Verizon, AT&T and others have been looking to expand their mobile advertising segments of their business. These carriers are creating video content that they stream to their users, funded by pre-roll advertisements in most cases. The FCC, however, is currently looking at a variety of privacy rules that are putting this type of advertising at risk. Specifically the regulations look at how wireless carriers can use customer information for advertisements. This will, of course, make it more difficult for wireless carriers to compete with major ad networks like Facebook and Google.
Doug Brake, a telecom analyst that is associated with the Information Technology and Innovation Foundation, said, “I think the rules as proposed are explicitly structured to lock down providers into providing broadband service and not providing digital advertising. The FCC’s proposal also has the potential to derail efforts by wireless carriers to cultivate mobile video advertising revenues.”
Some people who worry about the dominance of Facebook, Google and a small number of other major players in the ad industry were hoping that the wireless carriers entering into the market could add additional competition. With these regulations, however, that will be impossible.
While the proposal being considered by the FCC does not strictly eliminate the possibility of carriers from using customer data for marketing, it does say that they need to get permission in order to do so. As we all know, getting people to actively take steps like this is extremely difficult.
We will have to wait and see what the FCC does before fully understanding how it will impact the wireless carriers, and the digital advertising industry in general.
