The announcement that Facebook has finally launched its free basics Internet access to Nigerian is a good news for Nigerians and maybe Airtel.
However a deeper look at the arrangements makes Facebook the biggest winner in the arrangement.
For many months unending, Facebook has launched a global digital campaign using banners, search and video to push for more sign ups for its social network. While many are wondering why Facebook is spending tons of cash to push a product that has already become a global phenomenon. With over 1.65 billion users monthly active users, Facebook is seen to be reaching a diminishing point.
The move to launch free basics is a sign that Mark Zukerberg is not believing that narrative. Afterall, there over 4 billion users on the Internet. Facebook has only gotten hold of about 41% of the total Internet population. The growth for Facebook is in Africa, South East Asia and India subcontinent.
With Africa’s 1,1 billion population which is 16.0 % of the world’s population, only 330 million are on the Internet accrording to the World Interstat. Facebook has only 9.8 % of the African population on its network which is a mere 124 million. While Facebook has launched free basics across 40 countries, coming to Africa with this approach is to boost its sign up faster than it has ever had.
Airtel its strategic partner in Africa would indirectly get new SIM activations as a result of this exclusive benefits to its customer, but in terms of revenue growth, Facebook has more to gain.
Apart from increasing its stagnating user base, Facebook is expecting to boosts its revenue in Africa and other emerging markets. In its Q1 2016 result, Facebook revenue per user in emerging markets with Africa included fell in comparison to last years performance. With millions of Africans having unfettered access to Facebook through free basics, it is expected that clicks on banners, sponsored posts and videos will increase.
Google had tried to provide free web search and and use of Google’s products such as GMail but it did not push it for a medium term. In 2011, Google launched Google SMS, a service that allowed Gmail users to receive their emails via SMS and reply right from their native messaging apps.
We will be seeing a higher growth in Facebook user growth for the next quarter.