Facebook for Every Phone and its impact on the developing world

Image representing Facebook as depicted in Cru...

Image via CrunchBase

The mobile revolution in Africa is well documented, however mobile statistics are specifically impressive in the BRIC Nations — Brazil, Russia, India and China – as well as the likes of Indonesia, Mexico and the Philippines. Many emerging markets have skipped the ‘desktop generation’ and are already mobile-first economies where mobile devices are more ubiquitous than either land-line telephones, PCs, or fixed Internet connections. Although research suggests that global smartphone shipments have overtaken those of feature phones recently, it is still the basic feature phone that dominates in emerging markets. Facebook has been quietly working on a project over the last 2 years to expand its user base of 1.1 billion and enable Facebook access on simple, feature phones.

The scheme is called ‘Facebook for Every Phone‘ and has reached 100m users. The stripped-down, minimum capacity version of Facebook is accessed through over 3,000 types of feature phone, some costing less than 20 dollars. Working with mobile operators, Facebook has encouraged them to allow users free or cheap access to this basic version of their product.

Why is Facebook doing this?

Although markets such as India, Indonesia, Brazil, India, Mexico and Vietnam are not currently lucrative advertising markets for the internet giant, they are some of the fastest growing markets for internet access and social networking, and Facebook is clearly eyeing up its next generation of customers and the potential ad revenue these markets will bring.

As Facebook subscription in the likes of the US reaches saturation point, many people see the next generation of customers from the developing world as Facebook’s greatest opportunity to increase its global market share. Although Facebook’s success in the mobile advertising market has been well documented, it is still like many struggling with the seismic shift in internet access from the PC to mobile devices. As the economies of emerging markets grow and its consumer class demands access to the same products and services as the developing world, they represent a lucrative market for the likes of Facebook. Indeed, research suggests that users who access the product through a feature phone are the most engaged users, representing another opportunity for advertisers. As the middle class in the developing world grows, so do their purse strings and Facebook is fully aware of this.

Snaptu

Facebook purchased an Israeli company called Snaptu, that had begun to produce basic versions of applications to allow users to access them on feature phones. Facebook, having originally discounted mobile Facebook access as simply a way to update a status as opposed to the full service, saw a massive opportunity here. The Snaptu team began to re-engineer Facebook’s software to reduce its capacity and allow it to run off minimal data requirements. Facebook for Every Phone includes all the phones most popular features, including News Feed, Messenger and Photos, and is optimized to use less data than other Java apps and mobile sites.

Despite the obvious benefits access to Facebook brings many people in the developing world, there is a danger that users see Facebook as the entire internet, instead of just a small part of it. As powerful internet giants such as Facebook, Microsoft and Google continue to see emerging markets as a priority, there should be a limit to their influence allowing home-grown developers and mobile applications to launch and thrive in the developing world.

Future Mobile Trends in Africa

Satellite image of Africa, showing the ecologi...

Satellite image of Africa, showing the ecological break that defines the sub-Saharan area (Photo credit: Wikipedia)

Mobile access has democratised technology and allows people to communicate across geographical borders as well as acting as a social glue from a personal point of view as well as a broader societal perspective. Nowhere is this point more prevalent than in Africa.

Below are several key points derived from a recent report entitled ‘Mobile Trends 2020 Africa’ which was put together by various industry experts, as well as my response to each point.

The African market will see a flood of cheap smartphones allowing access to online information and social networks which could have an impact on the democracy of a country

We all saw the impact of  social networking, particularly Twitter, during the Arab Spring. The mobile device and is use as a mass communication tool also had an impact on the recent elections in Kenya, previously marred by mass violence, by means of monitoring results and diffusing ethnic tensions. Finally, mobile technology can also be used by politicians to communicate with its electorate and open up information on policies.

Smartphones will replace the need for physical banks, as mobile makes banking a far easier process

The success of Kenya ‘s M-PESA has been well documented and has opened up banking services to large numbers of people in parts of Africa and Asia. Africa is the hotbed of Mobile money activity, and the continent counts 15 of the top 20 countries by mobile money usage. It’s success has been such that it will also soon be launching in India.

Concerns are rightfully being raised around security, however the potential benefits to millions of’ unbanked’ people surely outweigh the risks, and opening up mobile money access acts as a tool of empowerment allowing people and businesses to prosper.

In addition, mobile devices are being used to prevent corruption, in places like Ivory Coast and Afghanistan, as mobile money payments ensure that workers get their full pay and the m-transfer prevents management from taking ‘tips’.

Mobile and associated technologies will ensure Africa acts as a hub of innovation

There are countless examples of this, the most prominent one being Kenya’s Silicon Savannah which will provide employment and act as a centre of innovation for the region, this follows on from Kenyan technological breakthroughs such as M-PESA and Ushahidi. In addition, projects like the iHub in Kenya offer an alternative picture of a bright future for the continent with a focus on technological innovation.

The crucial role of Mobile in Africa

Excellent quote from Eve Pennington, Head of Human Experience for SMG and ZenithOptimedia South Africa discussing a recent report entitled ‘Mobile Trends 2020 Africa’

‘Where technology was always the remit of the wealthy, mobile technology has democratised technology. It allows people to connect with one another across geographical borders and facilitates like minded people congregating and sharing experiences.

Mobile acts as the social glue for a society from a personal point of view and from a broader social development standpoint, enabling the biggest social need in countries such as education and health’

Kenya pushes forward with “Silicon Savannah”

English: I&M Bank Tower in Nairobi, Kenya

English: I&M Bank Tower in Nairobi, Kenya (Photo credit: Wikipedia)

Kenya has begun building the recently dubbed ‘Silicon Savannah’ development in Konza, about 60km south of Nairobi and the project is widely expected to be a game-changer for Kenya’s $36bn economy. The country that has focused on technology as a means of economic progress, and brought the continent breakthroughs such as M-PESA and Ushahidi, has now turned it’s attention to ensuring that it is one of the main centres of Africa’s technology sector. M-PESA is the country’s mobile phone banking system which empowers people by allowing the simple transfer of money through a mobile device and has helped the previously “unbanked”. Indeed, it estimated that the service transfers the equivalent of 27% of the country’s GDP. M-PESA has seen a massive uptake in Kenya and Tanzania and has recently launched in India targeting 220m people in Eastern parts of the country. Ushahidi is an open source, not for profit project that allows users to crowdsource information via multiple channels including mobile, the web, and twitter.

Construction on the 5,000 acre piece of land in Konza, has begun in an effort to turn Konza into the most modern city in Africa. The project has been split into 4 phases, with the initial phase planned for completion in 2017. Encouragingly, it has been reported that the development is not just about attracting technology firms to the site, but is also a way of circumventing the country’s corruption, which has been deeply embedded for decades. The site is also projected to create 200,000 jobs when completed in 2030, as well as schools and universities. Konza – economically and politically a “new city” in Africa – may well act as a blueprint for further developments on the continent.

The project is a natural progression for Kenya’s aspirations to be the technology hub in Africa, and organisations such as IBM, Google, Microsoft and Intel have their regional headquarters there. Concerns however have been raised about the fact that most of the companies being formed in Kenya are based on a single app or software programme, making them economically vulnerable. In addition, despite clear progress in the technology sector, the Kenyan government still has a long way to go in addressing the country’s 40% unemployment rate.

Will basic smartphones open up the developing world?

Nokia 6020

Nokia 6020 (Photo credit: Wikipedia)

As the latest smartphone becomes the de facto requirement for Mobile users in Europe and the US, it would be pretty easy to think the smartphone is the dominant phone throughout the world. Think again. While the UK and US struggle under mountains of debt and an uncertain economic future, parts of the developing world are making huge strides in connectivity and communication being driven by, you guessed it, the good old feature phone.

In India, mobile adoption is high in both towns and cities and offers a way of reaching parts of the country that are normally untouched. Indeed, Indians spend more time on their mobile device than on any other medium. Yes, this does mean opportunities for advertisers however examples of how mobile can advance peoples’ every days lives are plentiful. Recently, a funny telephone game has gone viral in Pakistan which allows illiterate and poorly-educated people to find out about jobs and telephone-based services. In Africa, Mobile devices are being used to warn people of floods, natural disasters and outbreaks of diseases that could affect both people and livestock. Kenya’s iCow offers farmers the opportunity to register their cow through a text and receive regular updates on gestation periods and when cows are most likely to mate. M-PESA, originally launched in Africa and newly launched in parts of India, gives the “unbanked” access to mobile banking services. This cheap, mass-communication device will continue to help people throughout the developing world.

It is the feature phone not the smartphone, that is driving this and global shipments of feature phones still far outstrip smartphones. The latest Android or Apple device is far too expensive for the majority of people in developing countries, and cheaper alternatives offer the basic services that people require. As mobile shipments continue to steer towards the developing world, we are likely to see companies turn their attention that way and come up with cheaper alternatives. Although there will always be an aspirational facet to owning a premium smartphone, and countries with burgeoning middle classes such as India and China will drive this, the large tech companies will need to produce cheaper alternatives to increase their uptake.

M-Pesa arrives in India

English: A poster advertising the introduction...

English: A poster advertising the introduction of the mobile payment service M-Pesa in Tanzania (Photo credit: Wikipedia)

The Vodacom M-Pesa mobile banking service has been a huge success in many African countries and has recently launched in parts of India. After the huge success the M-Pesa service has had in Africa, it is hoped that the service will have the same impact in India. We take traditional banking services for granted in the West, but huge numbers of people in developing countries simply don’t have access. M-Pesa offers a way of empowering people and allows for the free flow of money in countries like Kenya, Tanzania and now India. M-Pesa adopts a simple, text-based approach to enable users to deposit and withdraw from specific M-Pesa outlets, carry out transfers, make payments at retail outlets and pay utility bills.

The M-Pesa service from Vodacom will target 700m people in India who currently don’t have access to banking services. It is being launched in partnership with ICICI Bank and will initially target 220m people in Eastern areas of India with the aim of reaching the 700m people in India with no access to banking services.

Whereas there is currently a ‘land grab’ in the UK for the potentially lucrative mobile payment market, with the likes of Google, PayPal, VISA, the newly launched WEVE and Retail outlets all jostling for position in what is likely to be a long and complicated process, more simple solutions in developing countries are likely to have more of an impact on peoples everyday lives. It may indeed be places like India and Africa that lead the way with mobile payment services, allowing for countries like the US and UK to learn from the process. Indeed, whereby mobile payments play such a crucial role in peoples lives, the issue of ‘trust’ around the security of the system is circumvented and progress is potentially quicker.

Marten Pieters, managing director and CEO of Vodafone India, stated

For millions of people in India, a mobile phone is a bank account, a front door to a micro-business or a lifeline to people in the remotest areas. Research shows that M-Pesa brings real benefits to users in their daily lives, saving three hours a week of their time and around $3 in money transfer costs – a significant amount to people in some areas.