Today, approximately 2.5 billion people have some form of internet access. Mark Zuckerberg, founder and CEO of Facebook, recently announced the launch of internet.org, a consortium of handset makers including Nokia, Samsung, Ericcson), browser companies like Opera, infrastructure companies such as Qualcomm and MediaTek. Declaring internet connectivity a human right, the internet.org alliance has the stated goal of making internet access available to the remaining 5 billion people on the planet.
The group intends to drastically cut the cost of basic internet service, especially for mobile phone data plans in developing countries. A key part of lowering costs will be reducing the bandwidth required for Facebook and other apps by simplifying the applications so they run more efficiently and by improving the components of phones and networks so that they transmit more data while using less power. In an interview in Wired Magazine, Zuckerberg talks about reversing the course of ever-increasing bandwidth requirements for applications like Facebook to make it more affordable for those in developing nations. While phones have gotten to be relatively inexpensive, the cost of data plans remains unaffordable for many: “In the beginning of this year, the average person used about 12 megabytes for the Android app on Facebook, and I think over the next couple of years, we’re going be able to get that down to one megabyte a day, with very few changes. Since one megabyte is still too much for a lot of the world, the question becomes, Can you get to half a megabyte or a third?”
Zuckerberg foresees the cooperation of members of the consortium leading to a text-based internet service that would provide the equivalent of an “Internet Dial Tone” for free. A minimum level of service that would include access to useful information like Wikipedia, search engines, social networks, weather access, and commodities prices for anyone anywhere anytime.
Declaring that this project is simply too large to be undertaken as a strictly philanthropic venture, internet.org attempts to marry the greater societal good with the demands of capitalism, and it might very well work. All of the tech companies in this sector are under pressure to find long term growth, and the developed markets are at near-saturation, making emerging markets an attractive avenue for the kind of growth Wall Street demands.
Internet.org is not the only entity experimenting with this business model either. Google, which is notably absent from the coalition has its own program that its testing with phone carriers in developing countries, giving users free access to Gmail, search and the first page clicked through from a search’s results. Twitter, which is currently preparing for its IPO, has set up deals with 250 mobile companies in more than 100 countries to offer free Twitter access.
From within the coalition, Nokia recently ran an experiment with Facebook and the Mexican phone carrier TelCel where they bundled Facebook with some of Nokia’s Ahsa phones. The resultant rise in sales of those phones made such a good business case for the practice that they’ve expanded the program to Africa and India, partnering with Bharti Airtel, one of the larger mobile carriers that serves both the continent and subcontinent.
On the infrastructure front, Qualcomm has created new chip designs to maximize phone battery life and worked out compression schemes that reduce the amount of data needed to transmit a video significantly. They’ve also come up with miniature cell service transmitters to extend the reach of mobile networks with devices that are the size of WiFi routers rather than the large, expensive, tower-mounted arrays that are prevalent in the developed world.
In an article in the New York Times, it’s pointed out that the profit potential of connecting more people to the internet is already obvious in places like the Philippines, where the second-largest mobile phone company, Globe Telecom, used free Twitter, Facebook and Google access as a promotion to increase the number of its 37 million users who also subscribe to a mobile data plan to 20 percent from virtually zero in just two years. “Once you’re connected, you’re connected, and you don’t want to look back,” said Peter Bithos, Globe’s senior adviser for consumer business.
Answering critics that say that this is merely an expansion plan for Facebook, wearing a humanitarian cloak, Zuckerberg replies: “Of course, we want to help connect more people, so theoretically we do benefit from this. But that criticism is kind of crazy. The billion people who are already on Facebook have way, way more money than the next 6 billion people combined. If we wanted to focus on just making money, the right strategy for us would be to focus solely on the developed countries and the people already on Facebook, increasing their engagement rather than having these other folks join. Our service is free, and there aren’t developed ad markets in a lot of these countries. So for a very long time this may not be profitable for us. But I’m willing to make that investment because I think it’s really good for the world.”
NationalNet continues to pursue technological advancements in the area of collocated hosting, data center infrastructure upgrades and optimization techniques that improve efficiency. In the recent past, bandwidth costs have dropped considerably and significantly lowered the hosting expense of most online entities – but these developments show that reducing bandwidth consumption is important for reasons that go beyond lowering a monthly hosting statement. In the very near future, maximizing revenue for any web service or digital product may be as much about delivering it in the fewest data packets possible as it ever was about reliable up-time or anything else.