T-Mobile trivializes SMS

T-Mobile is making a free trivia game available to all of its customers that it hopes will make the operator’s service stickier in an age of cutthroat competition. The SMS-based game is available to every T-Mobile customer, from smartphone users to talk-and-text phone owners, across its prepaid and postpaid, and it promises the bonus of a big payoff—$4000 daily cash prizes and a weekly prize of an Audi Q5.

The game is called 4G PayDay, but has nothing to do with T-Mobile’s high-speed packet access plus (HSPA+). The only hardware or service requirement is an SMS-capable phone. After opting in via SMS (texting START to the short code 4444), T-Mobile sends the customer a series of multiple choice trivia questions. Through SMS responses, the customer can keep playing until he or she answers a question incorrectly or the hour time limit expires. Each customer can play up to three games a day, and at the close of each 24-hour period, T-Mobile awards a $4000 prize to the customer with the highest tally of any single one-hour game. At the end of the week, T-Mobile gives the car to the customer with the highest total of consecutive correct answers.

This may seem like an innovative means for T-Mobile to encourage more messaging usage as operators see SMS growth suffer from competitive IP messaging services like IM and e-mail. But T-Mobile is exempting all SMS charges in the game—even for customers who have no messaging plans and pay by the SMS. There is a funding mechanism built in, though: For every question there is an option to receive a hint or skip to the next question. Either choice costs $1, and skipped questions don’t count toward the total correct answer tally. So there is no way a customer can skip his or her way to winning a prize.

Has T-Mobile stumbled on a new way of monetizing SMS—making it the vehicle for games and contests? Hardly, said Brad Duea, T-Mobile senior vice president of value added services and marketing. T-Mobile is hoping the skip and hint revenue will cover the cost of the prizes and marketing of the service, he said. The main goal of the 4G PayDay is for T-Mobile to engage more closely with its customers, Duea said. T-Mobile wants the game to go viral, generate buzz, and give customers an exciting reason to switch to T-Mobile if they’re on another carrier or stay with T-Mobile if they’re considering switching, Duea said.

Though no U.S. operator has offered such a carrier-branded service, the concept has been tried out in several developing markets, usually with the goal of generating more SMS revenue, Duea said. While T-Mobile isn’t using the game to generate more SMS revenue—and in some cases is taking a hit on that traffic—Duea said the carrier was inspired by the added benefits these games accrued to the operators that ran them.

“What we’ve seen is a great buzz generated where it’s been done,” Duea said. “We hope to get people talking about T-Mobile with this game. We hope to see a lot of goodwill created from the prizes we give out.”

Duea said T-Mobile will run the contest from today until Oct. 2, giving out more than $400,000 in cash prizes and 15 different vehicles. After the first contest period ends, T-Mobile will evaluate its success. If T-Mobile is able to recoup its prize costs from skip and hint revenue, it hopes to launch another contest round, Duea said.

Even if T-Mobile winds up losing some money on the game, it may be worth its while to keep it running. Acquiring new customers and keeping old ones from leaving is an expensive proposition for all operators. If T-Mobile experiences any noticeable drop in churn that could attribute directly to 4G PayDay, it will have gone a long way to recouping its costs.