FRX have chosen WhatsApp, but could in effect do this with any other app or type of traffic on their network. E.G Viber, Line, WeChat, FB, Instagram, Spotify, etc.
What they are doing is demonstrating the sponsor concept to potential partners.
"Hey Mr partner, we offered our users free WhatsApp chat for 1 year in exchange for 10 referrals and we gained an additional 10,000 downloads in just 2 months. Of these downloads 1,000 turned into customers spending $100 each and we generated an additional $100k in revenue. The data we supply to the 1,000 referrers will cost us $10 each or $10k. In addition, these referrers were never interested in paying for our service so we hardly cannibalised any revenue at all."
The initial partnerships I'd expect to result from this offer would be from existing partners (such as TripAdvisor, Union Pay, Grab, Food Panda?(since Acquired by Delivery Hero), Korean Air, Scoot, KLM).
I believe FRX would get most traction targeting their offering towards services that add transactional dollar value to the providers service.
So Grab (asian version of Uber) could run a promotion for X2 users to provide them with free usage of their App whilst roaming abroad, as well as say 500MB of data for each ride you take with them. This would make sense for them as many westerners only use Uber, so it is in essence creating a customer they would otherwise be unlikely get. I expect that FRX would offer this data at a reduced wholesale rate to Grab based on volume, resulting in a win-win for both parties.
It would also be very valuable for currency exchange, travel insurance, car rental, hotel chains, etc. The cost of providing the data to the customer would be offset by the revenue generated by facilitating a transaction, in addition to goodwill with the customer.
How happy would you be with Commsec/CBA if they enabled you to execute a profitable trade in the middle of the jungle in Ubud whilst on holiday, or block your credit card in Africa after you wallet was stolen?
The above examples would generate tiny amounts of network traffic, but be high in transaction value, and in many cases may have not occurred without the immediate availability of data.
The additional win for FRX is these customers will have an X microchip in their phone for the foreseeable future are more likely to purchase data packs and refer others to X.
FRX Price at posting:
7.5¢ Sentiment: Buy Disclosure: Held
