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MWC 2014 Daily Round-up: Day Two

By Informa Telecoms & Media, February 25, 2014

Zuckerberg outlines vision of what Internet-access-for-all means for Facebook and the mobile industry

Facebook CEO Mark Zuckerberg used his MWC 2014 fireside chat with author David Kirkpatrick on Monday evening to provide an update on the progress of the Internet.org initiative and to promote the opportunities it offers to mobile operators. He also outlined how the company’s US$19 billion acquisition of WhatsApp last week aligns with Internet.org’s ambitious goal of enabling Internet access for all mobile users.

The Internet.org project involves Facebook and six handset/chipset/browser vendors – Samsung, Ericsson, MediaTek, Nokia, Opera and Qualcomm – and has the objective of enabling Internet access for, and promoting Internet access to, all mobile phone subscribers, not just those with feature phones and smartphones. By so doing, Zuckerberg argues not only that mobile Internet access could improve the lives of people in emerging markets but also that it could ultimately prove profitable for mobile operators.

He added that, even though 80% of the world now has Internet-capable network coverage, there is no corresponding penetration rate for Internet access, for two main reasons: affordability of the service, and the fact that many people in emerging markets do not know why they might actually want to access the Internet. “If you ask someone if they want a data plan, they say no; if you ask them if they want Facebook, then they say yes,” Zuckerberg said. Once mobile subscribers start consuming Internet-based content and services, they might then start becoming interested in accessing other Internet-based content and services, which in turn would generate more data traffic and revenues and, ultimately, profit for mobile operators.

At the moment, however, Zuckerberg says Facebook is very much at the stage of “sharing the vision.” He gave an overview of two Internet.org partnerships that are already delivering results. In the Philippines, Internet.org has been working with mobile operator Globe on an infrastructure project that has already seen mobile Internet penetration double among Globe’s subscriber base, with overall subscriber numbers increasing 20%. In Paraguay, Internet.org is working with Tigo on a similar project, which has seen mobile Internet penetration increase 50%, with daily Internet use growing 70%. “We are at the point where we have proved to ourselves that the model can work,” Zuckerberg said.

The next step is to involve more partners, which is partly the reason for Zuckerberg’s attendance at MWC 2014. “We don’t have the capacity to work with a lot of companies yet, but we want to find three to five companies that we can work with over the next year,” Zuckerberg said, “and if we can do that successfully then we’ll be back [at MWC] next year or the year after that in a position to be able to offer [the Internet.org capability] to everybody.”

Over the next year, Facebook plans to trial the complete vision of Internet.org, including a range of services and upsells, based on the knowledge it has about its customers, its own services and the carriers. “What we envision for carriers is a model that can help them get more subscribers and connect more people,” Zuckerberg said. “It is up to them to choose which services they want to give people for free. Our model and what we are trying to build is proof that building an on-ramp is better for the Internet and better for our customers.”

The project will involve three main pillars: reducing the cost of Internet infrastructure; optimizing data use on the network; and increasing the number of upsells to subscription-based services. Zuckerberg told delegates that a year ago the average Facebook user used 14MB of data per day; that has now decreased to 2MB per user per day. Additional data efficiencies are likely to be achieved via Facebook’s acquisition of Onavo, a provider of client-side compression technology.

Regarding upsells, Facebook has already seen significant improvement with its carrier partners. “The more friction we can take out of that purchasing process, then the easier we can make it for people to purchase content,” Zuckerberg said.

And it’s a mission that also resonates with WhatsApp, according to Zuckerberg. Acquiring WhatsApp made sense to Facebook because of the value inherent in the company itself, with its 465 million monthly active users and the potential to deliver significant revenues from that user base. There is also a shared ideology at the top: WhatsApp CEO Jan Koum shares Zuckerberg’s enthusiasm for Internet.org and for connecting more mobile users to the Internet. “When Jan and I first met we started talking about this, about what it would be like to connect everybody in the world,” Zuckerberg said. “It wasn’t until we got aligned on that vision between Facebook and WhatsApp that we started talking about numbers. That vision is what I think makes the companies a great fit.”

And, finally, would Facebook make another bid for picture-messaging application Snapchat? “After buying a company for US$16 billion, we are probably done for a while,” Zuckerberg said.

Samsung and PayPal add momentum to biometrics push

Samsung’s and PayPal’s announcement regarding digital fingerprints on the Galaxy S5 adds to the buzz this year at MWC around biometric ID alternatives to logging in with usernames and passwords. There is also talk of using users’ unique heart-rate patterns via health-tracking wearable devices, and a new startup called iProov is pushing photo-ID via “selfies.”

Vodafone Germany and Ericsson claim European first with LTE Broadcast trial

Elsewhere at MWC 2014, Vodafone Germany and Ericsson announced that they are trialing LTE Broadcast, a point-to-multipoint video-distribution technology that puts no additional load on the network. Vodafone Germany is the first European carrier to conduct live tests with LTE Broadcast, in collaboration with Ericsson, Qualcomm and Samsung.

The technology uses Single Frequency Network technology to distribute the signal to an unlimited number of recipients. The user only needs an LTE-enabled device with an LTE Broadcast app. As part of Vodafone Germany’s network-modernization program, LTE Broadcast might soon be rolled out in German stadiums beyond the one in which the trial took place.

Orange offers assistance to IoT startups

Orange announced that it is helping startups specializing in the Internet of Things (IoT) to help them accelerate their development and bring their products to market. The move builds toward the IoT hyperconnected world the mobile industry is approaching with 4G and which is expected to truly arrive when 5G networks are ubiquitous, estimated, by the NGMN, to be around 2020.

By backing IoT entrepreneurs in the development of their businesses, Orange says it is supporting the growth of the IoT market, which is especially strong in the fields of personal services, healthcare, the connected home and smart cities.

Orange is opening up its online-distribution channels, which are usually reserved for mainstream branded devices, in France, 19 other European countries and South Africa. Orange will also provide assistance for startups seeking to industrialize their connected-object prototypes through relationship-building support with global manufacturers. The offer is available to startups from all over the world that have developed a prototype or are on the verge of launching a connected object using 2G, 3G, 4G, Wi-Fi or Bluetooth technologies.