Facebook Ties Up With Operators For Discounted Data
Facebook has announced a number of partnerships with mobile operators to provide free or discounted data access to Facebook messaging for their subscribers.
The promotion offers free or discounted data access on Messenger for Android, Messenger for iOS and Facebook for Every Phone, which is now optimized for chat. It will be available from more than 18 operators in 14 countries. The operators include TMN in Portugal; Three in Ireland; Airtel and Reliance in India; Vivacom in Bulgaria; Backcell in Azerbaydzhan; Indosat, Smartfren, AXIS and XL Axiata in Indonesia; SMART in the Philippines; DiGi in Malaysia; DTAC in Thailand; Viva in Bahrain; STC in Saudi Arabia; Oi in Brazil; Etisalat in Egypt; and Tre in Italy.
Pamela Clark-Dickson, senior analyst at Informa Telecoms & Media, believes the promotion has the potential to deliver benefits to both the operators and to Facebook, since both parties will likely be able to use the promotion to boost customer acquisition and retention, and also to increase their revenue from mobile data and mobile advertising, respectively.
“The promotion has the potential to drive existing smartphone users to download and use the Facebook application/s, and it may also help the mobile operators to gain new smartphone and mobile data customers, whether they are new customers or customers that have been up-sold from feature-phones,” said Clark-Dickson. “Many of the operator partners listed by Facebook for this promotion are in emerging markets, where smartphone penetration is low, but where Facebook is very popular. A number of the mobile operator partners (for example, Smart, DiGi, XL) have also been offering Facebook Zero to their subscribers, a text-only version of Facebook for which the operators do not charge their subscribers data fees. It is possible that Facebook has come under pressure from its mobile operator partners to provide a strategy that would allow them to migrate Facebook Zero subscribers to a service that would generate revenues. However it is as yet unclear whether the mobile operators concerned will shut down their Facebook Zero services. Moreover, the partnership is described as a promotion, which would seem to indicate that it has a finite lifespan.”
Clark-Dickson adds that Facebook will potentially benefit from the partnership also by being able to increase its reach, and consequently, its ability to generate revenues from advertising.
Informa believes that Facebook could generate about $1bn in revenues from mobile advertising in 2013, or about 10 per cent of total global mobile advertising revenues of $12.8bn in 2013. Facebook itself reported that its revenue from mobile advertising represented about 23 per cent of its total advertising revenue of $1.33bn in Q4, 2012, or $305m. The social network had 680m monthly active users (MAUs) on mobile in Q4, 2012, representing 64 per cent of the company’s total MAUs of 1.1bn. Facebook also stated that it had 157m mobile-only MAUs in Q4, 2012 (15 per cent of total MAUs).
“Unlike the providers of other over-the-top communications services, Facebook has so far been willing and able to maintain what appears to be a good working relationship with its mobile operator partners, and its latest partnership announcement is testament to that,” concludes Clark-Dickson. “However, it’s possible that Facebook’s relationship with mobile operators will be tested by the addition of VoIP to its iOS applications, which may be one reason why the company has only rolled out the capability in N. America."
Facebook messaging and chat can be accessed from more than 6,000 mobile phones via Facebook Messenger, Facebook for iOS and Android, Facebook for Every Phone, m.facebook.com and across other devices with Facebook integration.