ümobile (or U Mobile) is Asia’s 1st Free, Ad Driven Telco

Huge news for the Asian telco industry. But just to put a little perspective … there’s been a lot of speculation on the Google Phone business model since 2005. With Google’s core competence being contextual advertising (wasn’t it search a long time ago?) they’ve never really kept secret about their plans to use the 700MHz spectrum for a completely free, advertising driven telco and broadband (?) service.

Free, advertising driven telco.

Well, Asia has just opened up it’s first and it’s in the Philippines. Pardon me, I had to break the news in my personal blog simply because of regional implications. I wanted the thought of a free telco to settle in.

So here are a few thoughts about the service and what exactly “free” means.

First off, it isn’t completely free. U Mobile works pretty much like any other telco because it is owned by SMART telecommunications, which is perhaps the largest telco in the PH. The “free” part comes in when you opt in to the contextual advertising program that is sent to your phone and when we say “contextual” we mean something predetermined by a series of lifestyle questionnaires. I filled mine up and it took me a good 20 minutes to get through everything. The form is updated every year. If you don’t fill up the form, you cannot participate in the ad program. There is also a current limit to the maximum amount of free credits you get. I expect this to get higher and higher as they win subscribers.

Not everyone can sign up just yet. Sign ups work like Orkut’s social network where you need to be referred by a friend who is currently a subscriber. The first 350 handsets were generously awarded as raffles to “influential people” who attended the launch (wow, I’m influential!).

Leo Laporte and the rest of TWiT talked about the implications of ad driven telco services. It’s a question of whether you want to allow advertisers to spam your sacred inbox with advertising. Some people may be sensitive to this. Some don’t really care.

The service launched yesterday and there are just so many questions for U Mobile. Hoping to grab an interview with them soon. But yeah this shows how the telco is evolving, and being the first in Asia, well, wow. I’m not sure if similar telco operators in the USA and Europe have an equivalent service. Would appreciate a chime in from the readers!

The image above was taken by yours truly at the ümobile event launch.