Facebook has noticed something that other companies would do well to heed: The biggest opportunity right now isn’t in smartphones, where users are bombarded by the fruits of an ever-more-competitive market for apps and mobile services. Rather, the big play for some companies, especially any that wish to expand into emerging markets, is on the “dumbphones”—aka non-smartphones, or in industry parlance, feature phones—that most people in rich countries have now left behind.
We’ve known for some time that Facebook’s strategy for grabbing its “next billion” users is to convince them that Facebook and the web are one and the same by making access to Facebook free on every model of phone. But now Javi Olivan, head of “growth and analytics” at Facebook has dribbled out a handful of other interesting details about Facebook’s strategy.
The first is that, since Quartz first reported on it a year ago, Facebook’s push to get onto feature phones, which still comprise half of all phone sales worldwide, has accelerated. The service Facebook is working on is called Facebook for Every Phone, and it allows people with data plans on their feature phones to have smartphone-like experiences while using Facebook—meaning they get images, updates, chat, the whole thing. The secret is that most of the processing for Facebook For Every Phone is done on Facebook’s servers, in the cloud, and a minimal stream of data is trickled out to feature phones, which tend to be on slower networks in emerging markets.
Facebook for Every Phone is now on 100 million feature phones, which means almost a tenth of Facebook’s billion-plus users are accessing Facebook through devices on which Facebook isn’t normally accessible.
The second thing about Facebook’s push onto feature phones is that more and more of these devices can access the web. As Ran Makavy, head of Facebook’s feature phone initiative, told the New York Times, it wasn’t long ago that only about 2% of all feature phones could access the web. Now that figure is more like 25 percent, and he thinks “there is a pretty long runway still.”
In other words, billions of people the world over are going to start accessing the web through their feature phones, and in the rush to equip people with the latest and greatest, web experiences on these devices are likely to be an under-served market. Facebook is happy to occupy this space, but other companies should be, too, such as Jana, which is arguably the largest payment platform on earth, and can reach 2 billion people in emerging markets.
One issue, as always, with emerging markets, is that consumers here do not have as much disposable income as people in rich countries. Facebook just rolled out a platform to advertise to people in emerging markets via, among other services, Facebook for Every Phone, but it’s not clear yet how lucrative this effort will be. Even if Facebook can’t make money on these nascent web users right away, convincing them that Facebook is integral to the web is the sort of trick that will help the company continue to grow as these consumers graduate to smartphones, tablets and other more sophisticated means to connect.