ST Trend Alert: Free to barter

Major companies, such as Google, Sony, Cadbury's, EMI, Microsoft, and start-ups such as Blyk, SpiralFrog, QTrax, and We7 ? are all exploring new ways of providing services for free in return for time spent watching adverts. Music downloads, mobile phone subscriptions, games, or videos, even mobile handsets are all on offer. And these emerging barter based services seem to be popular.

• Peter Gabriel helped set up We7, to provide free on-line music downloads with adverts 'grafted' on the front. Any band can put their music on the service, as long as they pass the review of the 'tastemaker' group.
• SpiralFrog, Ruckus and QTrax are exploring similar ides , with QTrax chasing major contracts with the big record labels.
• Orange meanwhile has been testing a mobile based service since late 2006, with its Orange Portal. Users seem to like it.
• Blyk, another start up is targeting the elusive but all important 16-24 age group with its new phone service, and deals with Coca Cola, L'Oreal and Buena Vista are lined up.

Why is this important?

• As CD sales plummet and P2P illegal file swapping further erodes music sales, the music industry need to find serious alternatives. These barter based services will also give new bands new routes to market.
• The Web 2.0 generation is notoriously difficult to reach. 'Bartered' content services may be an important new route.
• These services may, as indicated by Blyk, allow for the precise targeting of subgroups, based on either data collection or music genre via We7.
• Savvy consumers may increasingly recognise the value of their custom and attention, and up the ante on what they expect in return for access. We may see the emergence of the ' personal value bank' ? personal networks, profile information and comment, with trade-able value.
• Research about advert effectiveness, film / programme testing or comment on ideas may become another focus for barter based deals.
• With the arrival of maps on phones, such as Nokia smart2go, and Yell (the electronic version of yellow pages), joining up with Blyk and possibly Orange, then the potential for location based, targeted, barter based advertising really begins to take off.

In some respects, these ideas have been a long time coming: back in 1997, several services were being tried out in Italy, Sweden and Germany, but were regarded as a curious experiment!

Sheila Moorcroft, Research Director, Shaping Tomorrow

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