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A new company is giving Americans free TVs. You know why


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Deepfate

A new company is giving Americans free TVs. Is it the start of an all new era of free consumer electronics?

Telly’s pitch is simple: 10 minutes of your time to fill out a survey, get a free TV (Telly)

FREE?

A new startup called “Telly” is giving Americans free smart TVs in exchange for 10 minutes of their time filling out a survey. (The company says the TVs are worth about US$1000.)

Too good to be true? It’s not. The reason Telly’s able to give this hardware away is because this particular TV comes with a second screen, a short and wide rectangle that hangs below the main screen and always shows ads, no matter what.

WHERE DO I SIGN?

Telly's free smart TV offers an attractive bargain. And they’re very open about how:

“Brands pay for the non-intrusive ad on the Smart Screen… you get Telly free. It's time you got cut in on the deal.”

But zoom in. The underlying dynamics of this seemingly benign offer are complicated. And the Telly trade off has some far-reaching implications.

THE GOOD NEWS: FREE TV ON A FREE TV

Telly’s founder also co-founded the free streaming video service Pluto. Pluto’s free because (you guessed it) it also serves ads. He calls Telly the biggest innovation to happen to television since color.

But, like, is it?

NOT A SLAM DUNK

Providing free or deeply discounted physical products in exchange for ad consumption isn’t new. This idea has been experimented with in various ways over the past few decades.

For instance, Amazon sells Kindles at a loss, because they know they will make up the difference with e-book purchases and ads.

In the late 90s and early 2000s, Americans could actually get home Internet service for free, in exchange for watching ads. The most notable free ISP was NetZero, which offered free Internet, but made users watch an ad bar on their screen while browsing.

Google's business model for Android can be seen as a variation on this theme: the company provides the Android OS to device manufacturers for free, but in return, Google's services (which, of course, display ads and gather user data) must be pre-installed on the device.

BUT. Not all of these initiatives have been successful. Sure, some have managed to gain a user base, but many others seem to have struggled with long-term sustainability, mostly because of the high costs of the provided product or service, and the challenge of generating enough ancillary purchases or ad revenue to cover those costs. (Rising interest rates don’t help this business model.)

What’s more, companies doing this also have to deal with user fatigue from all of that constant advertising, which can totally affect the overall user experience.

WHAT’S DIFFERENT WITH TELLY?

Telly presents an intriguing manifestation of what I call "The Deal" (that’s is my nickname for the advertising supported business model). Telly’s twist is that funky, two-screen set up. The smaller second screen is dedicated to constant advertising. It’s an audacious play.

But Telly's success or failure actually rests not only on its ability to generate enough ad revenue to cover the cost of these luxury TVs, but also on consumers' willingness to barter their privacy for free electronics.

Yep, their privacy.

THE WORLD’S MOST VALUABLE RESOURCE

I’ve really enjoyed writing about data lately. Not from a scientific angle (I’m not a scientist), but from a cultural, and a pop-economics one.

I love the idea, first popularized by The Economist back in 2018, that data is the most precious commodity of the modern age. I also love analogies, and so I dig thinking about oil, or diamonds, when thinking about the value of data.

Oil, diamonds, and pretty much every precious substance, comes out of the ground in a really raw form that is actually not very usable. On the way to market, oil, diamonds, lithium, and many, many more commodities have to be refined into something else in order to really unlock their value.

Same goes for data. In its raw form, data’s value is actually more theoretical than practical. BUT. When that data is parsed into information, the whole package becomes something you can sell for a lot more. And when that info is further distilled into insights (that you can base big decisions on, like who to serve ads to), that data becomes more valuable still.

COOL STORY, BRUH. THE POINT?

Telly does embody an evolution of "The Deal," but the ads are actually small beer. As I’ve written, if you want to know the reason behind the moves that smart companies are making (and I have no idea whether Telly is a smart company or not), follow the money and look for the data angle.

Telly’s bet is that it can capitalize not just on the persistent visibility of ads on its secondary screen, but on the treasure trove of data gleaned from users' viewing habits.

MORE TO COME?

By transforming America’s living rooms into gold (data) mines, Telly’s paving the way for an era of ad and data-capture driven consumer electronics. Or is it?

On one hand, all this data mining might be seen as invasive. If met with backlash, Telly may well end up a cautionary tale about the limits of consumer tolerance for both "The Deal" and data capture.

On the other hand, we’re several decades into what I’ve called the “post privacy era“. Many people nowadays are both familiar and comfortable with the notion of raw data —our data— being mined and traded. Online firms have been mining our viewing and browsing habits and refining the results into commercially valuable info and insights for over 20 years.

On top of that, it’s also totally worth noting that the cost of living crisis likely makes free products even more attractive proposition.

OK, SO IS EVERYTHING GONNA BE FREE NOW, OR WHAT?

Telly’s play is to aggregate and transform all this raw data into valuable insights and information, ready for sale to the highest bidder.

That’s the play.

And people are here for it. Our society is data-saturated. Popular devices like Kindle Fires, Android phones and Google Pixel Watches routinely harvest and monetize user data.

Telly could potentially herald a new era of free, ad-and data-fueled consumer electronics. Or it could foster a new digital divide: between those who choose to pay for data-free devices, and those compelled, for whatever reason, to trade their privacy for "free" goods.

Bottom line: Free TVs today. But the implications for privacy, personal autonomy, and equality tomorrow are unknown.

More:

Telly official site »»

Written by Jon Kallus. Any feedback? Simply reply. Like this? Share it!👇

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