Imagine people in developing countries thinking Facebook is the gateway to the Internet. They would log into Facebook to access email, Wikipedia pages, weather information, and food prices. If they wanted additional services like the ability to stream video, they can buy it with a simple click—through Facebook.
That’s Mark Zuckerberg’s vision for Internet.org.
At the Mobile World Congress on Monday, Zuckerberg delineated some of his plans for moving forward with Internet.org, the initiative led by Facebook to bring Internet connectivity to poor countries around the world.
While Zuckerberg touted the altruistic vision of his company’s goal to connect the next one billion people, it’s important to note that the project isn’t just for the sake of bringing basic services to those that don’t have it, but rather bringing millions of additional eyeballs to Facebook and its advertisers.
“[We are] making it so that we can increase the amount of up-sells to subscriptions when they’re using these basic services,” Zuckerberg said in his keynote. “They will come to a link that isn’t included in the basic services package; a popup that says, ok if you want to consume this, you have to buy this data plan.”
Facebook is making a long-term promise to both data carriers and advertisers—Zuckerberg said the next one billion people to attain Internet access will not be as affluent as those already on Facebook, thus making it harder to monetize the company's services. Zuckerberg said the social network will subsidize Facebook, Messenger, and other services like weather or basic news and information, and then provide up-sells in applications to deliver the whole package—like a gateway drug. Those up-sells are where carriers and Facebook make money.
“The reason why they’re not on [the Internet] is they don’t know why they would want to get access to it,” Zuckerberg said. “[We will show] people why it’s rational and good for them to spend the limited money that they have on the Internet.”
How WhatsApp Fits Into Internet.org
Facebook recently spent $19 billion to acquire the mobile messaging application WhatsApp, an application Zuckerberg claims will be one of the few services to amass a billion users in the future. He claimed that, by itself, WhatsApp is worth more than what the company paid for it.
In developing countries like those Internet.org is targeting, many people rely on SMS communications due to a lack of data services. WhatsApp is already popular in many emerging markets, including those in South America and Asia where Facebook’s growth was stagnating.
While exploding in popularity, WhatsApp was facing pressure to monetize. It already had a subscription-based business model, but in order to handle the influx of customers, WhatsApp would've needed to focus on building out a business model. With the Facebook acquisition, WhatsApp was given the opportunity to focus exclusively on growth without worrying about revenue models, since Facebook is footing the bill.
The Next One Billion
“Connecting the world” is Facebook’s vision—one that can’t be achieved without the support of other organizations, including the six telecom companies it partnered with for the Internet.org initiative.
Zuckerberg said the organization is looking for an additional three to five partners to bring on board, ones that will bet big that Facebook subsidies of social services will pay off by up-selling their data plans. In most underdeveloped countries, 2G and 3G data networks are already available; people just don’t understand the value of the Internet yet.
“One thing I think is easy to take for granted is that most people in the world don’t have access to the Internet,” he said.
In order for Facebook’s strategy to work, it will have to make Internet relatively affordable, and provide incentives—like free Facebook access—for people to use it. Cheaper infrastructure, easier accessibility and up-selling additional data use will ultimately grow the company into a global Internet provider.
A Facebook phone may have failed in the U.S., but it might just work in international markets. By using Facebook as an on-ramp to the Internet, the next one billion people will use social logins not just to control various apps, but their entire Internet usage.
Lead image via screenshot of Zuckerberg's keynote at the Mobile World Congress