• Wednesday, February 21, 2024
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BusinessDay

Facebook defends $19bn WhatsApp buy, seeks to democratise internet

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Facebook, social network giant, says its recent acquisition of WhatsApp for $19 billion is all part of forging a high-powered, strategic coalition which seeks to bring affordable internet services to the next two or three billion people specifically those in emerging markets like Nigeria.

Mark Zuckerberg, chief executive officer, Facebook, made this remark while answering questions from technology journalists at Mobile World Congress (MWC) in Barcelona. Industry insiders at the conference told BusinessDay that the acquisition of WhatsApp is driven essentially by Facebook’s resolve to avoid irrelevancy in a dynamic technology market.

Blackberry, Motorola, Dell, Hewlett Packard (HP) in recent times have lost market relevancy and are currently struggling.

facebook-whatsapp

According to Adam Hartung, an industry analyst at Forbes, these firms were industry leaders who lost their luster, many of their customers, a big chunk of their employees and much of their market valuation in months when they missed a fundamental market shift.

But Zuckerberg insists that WhatsApp is a ‘great fit’ with for the company’s vision of connecting everyone on the planet.

WhatsApp Messenger is a cross-platform mobile messaging app which allows you to exchange messages without having to pay for SMS. It is available for iPhone, BlackBerry, Android, Windows Phone, and those phones can all message each other. WhatsApp currently has 200 million active users. As at December 2013, Facebook had 1.23 billion users on its network.

This marriage of both online businesses, according to industry insiders, could have a profound impact on improving the level of internet connections and subscriptions in underserved and unserved communities across the entire globe.

The number of mobile broadband users in Africa is expected to hit 277 million by 2015, according to research firm, Ovum. There are roughly 6 billion active cell phones in the world. Of the 6 billion cell phones currently in use, around 1.1 billion of them are mobile broadband devices.

“Why are the next two billion not on the internet?” Zuckerberg further queried. “The reason is not because they don’t have any money, it’s because they don’t know the value of having a data plan or the services they can access”, the Facebook CEO said.

According to the Nigerian Communications Commission (NCC), there are currently 120 million mobile subscribers out of a population of 167 million people. There are little over 47 million data users on operators’ network in the country. The Nigerian government, through the implementation of its national broadband plan, which includes issuance of new spectrum and infrastructure licences is really determined to connect the vast majority of Nigerian populace to the internet.

Under Facebook’s coalition dubbed ‘Internet.org initiative’, launched last August, Zuckerberg gave insight into some of the successes recorded with Globe in the Philippines and Tigo in Paraguay.

Both telcos doubled mobile data subscriptions within just three to four months by simply ‘zero-rating’ data chewed up by their users when accessing Facebook and other services, such as Wikipedia and weather information. According to him, customers were willing to pay for data once they had a free trial. But what’s zero-rating? It is the practice of not counting the data used by specific services or content against a user’s monthly data cap or data bundle.

By: Ben Uzor Jr