What If Every Mobile User Got Free Data? Some Companies Think It's A Gold Mine

Ok, Facebook blew it. It's Free Basics initiative in India was supposed to accomplish this goal. And as tends to happen with any of that company's concepts, sharing with local telecoms, tax authorities or regulators kinda got lost in the company's rush to claim credit - and power. Alas, the negative reputational cloud that tends to hover over any Facebook idea thanks to its previous grabby attempts to take first and sometimes ask for forgiveness later didn't help.

The notion that internet access is a multiplier exponentially expanding usage, data and financial rewards remains valid. This will require a change in conceptual thinking about how to make money from tech. But then isn't that what it's promise and experience has always been about? JL

Adrienne LaFrance reports in The Atlantic:

The Internet,e like most technologies, it’s a multiplier. It can multiply good, and it can multiply bad. But if you have no access, anything multipled by zero: It’s still zero. If you can monetize the metadata of what are people looking at—who is this person, what information can we sell —the data that’s passing through this network becomes just a high-volume business goldmine

More than half the people on the planet still don’t have Internet access. But figuring out how to get them online is as much of a political challenge as it is a technological one.
That was a lesson Facebook recently learned in India, where the company’s Free Basics program was effectively banned by regulators earlier this month. The idea behind Free Basics is to offer a stripped-down version of the mobile web so people can access parts of the Internet without it counting against their data plans. But those who oppose the plan argue that it gives Facebook an unfair advantage, and violates the tenets of the open web.
And although Facebook is continuing to move forward with Free Basics in several other countries, the setback in India has intensified the debate over how, if not through a program like Facebook’s, the digital divide might be bridged.
“I felt conflicted, frankly,” said Steve Song, a telecommunications policy activist. “I do think it’s problematic to have one of the largest companies in the world managing a large chunk of the world’s personal data. It’s clearly an issue that we need to be thinking about, and we don’t want to—in the name of doing something good—unintentionally do something bad by creating a de facto monopoly. At the same time, I felt that it just didn’t seem ethical to say, ‘You should just turn this service off.’”

In brainstorming possible alternatives, Song realized he kept returning to the same question: What if all mobile phones came automatically connected to the Internet at no additional charge?
The more he thought about it, the more he became convinced that what seemed like an idle fantasy might actually be a feasible plan to improve Internet access. Song’s idea is this: Mobile-network operators could make it so cellphones automatically come with low-speed, data-limited Internet access. Meaning: Mobile phones would automatically offer basic connectivity—essentially, data that you don’t have to pay for—so that people could access important online resources. However, the feature would be low-cost enough to implement that it would still make good business sense for providers.“Each person that gets added to the network adds value to everybody on the network,” Song said. “It occurred to me that that’s why mobile networks connect people for free to the voice network. It costs them millions of dollars per year to maintain ... but they add value to the network because they become other people who can be called on the network. Why wouldn’t that also apply to data? Don’t the same principles apply?”
There are other examples that demonstrate this same principle, suggesting that there might be good incentive for mobile-network operators to offer free, basic Internet. One precedent is the larger shift toward free email services. “And it wasn’t that long ago that people used to pay for browsers, either,” Song said. “You would buy a browser like a piece of software. But Internet companies recognized that the browser was the great enabler, so what was a paid service, previously, became a free service.”
For such a shift to take place on mobile networks, Song says there will have to be a more rigorous economic analysis. But he believes a good starting point might be to enable, by default, free 2G Internet connections at speeds around 9.6 kilobits per second—which is slow, really slow if you’re used to high-speed Internet. (He outlined his proposal in more detail in a blog post.)

“That’s about a quarter of the speed of what dial-up would be,” Song said. “So what would need to happen is you would need to have a profile for your phone that is secured to that basic rate—so it wouldn’t go downloading tons of stuff, you could disable images, but things like messaging services and basic Facebook would all work.”
Universal access to high-speed Internet might be the ultimate goal, but a slow connection is better than no connection, he says. “I think we underestimate how profoundly disadvantaged those without affordable access are, as the value of the Internet goes up and up and up—whether it’s agricultural information, or job information, or access to critical government.”

“The Internet, like most technologies, it’s a multiplier.”

Of course, just because something would be good for people, doesn’t mean a company will take steps (and spend money) to make it happen. “I think there would be push back from mobile-network operators in all kinds of places,” he said. “It will take some visionary action to make this happen.”
Song and others believe it’s most likely that mobile-network operators would be open to implementing his idea in areas of the developing world—where there are a significant number of people who still don’t have the Internet. This is already happening to some extent: In India, the telecommunications company Aircel says it will offer free Internet at 64 kilobits per second beginning in the fall. And T-Mobile has offered free 2G data roaming overseas. 
“For developing countries, this is extremely feasible, and it’s something that probably is going to happen,” said Pam Dixon, the executive director of the World Privacy Forum. “But in a more developed part of the world, I think it’s very, very difficult because the incentive is not there.”
Although there are still people in the United States who aren’t Internet users—some 15 percent of the adult population, according to Pew—network operators have several reasons not to offer free, low-bitrate access to the mobile web in America, Dixon said. Upfront costs might be minimal, but diminished access to data—the deep well of personal information collected about people when they go online—would be a big deterrent. In other words, if people opted for free access that’s slower and more basic instead of paying for more expensive high-speed connections, less data would be collected about them.

“If you can monetize the metadata of what are people looking at—who is this person, what information can we sell about this person—the data itself that’s passing through this network becomes just a high-volume business goldmine for them.”
However, there is still a chance, Dixon and others told me, that a small upstart mobile-network operator would offer free basic Internet as a way to disrupt the market in the United States. “There’s more room at the bottom of the market,” Dixon said.
“I mean, if there’s a will there’s a way,” said Josh Levy, the advocacy director at Access Now, a group that focuses on the intersection of human rights and digital rights. “I’ve suggested a very, very low-data package of like 50 megabytes per month that let’s people at least access the Internet and see what the possibilities are. But I don’t expect to see that happen from a [mobile network] operator. That kind of big-picture strategy has always come from the platforms like Facebook and Google and Mozilla ... And what I think the India decision from earlier this month showed is they kind of have to go back to the drawing board to figure it out.”
Song, for his part, is hopeful that the Free Basics quagmire represents an opening for mobile-network operators to rethink their role in all this. Regulators could even offer incentives for operators to step in, he says. “If you had a very forward-thinking regulator, they might say, ‘We’ll cover your risk for, say, the first three years.’”
“The Internet, like most technologies, it’s a multiplier,” Song told me. “It can multiply good, and it can multiply bad. But if you have no access, anything multipled by zero: It’s still zero.”