Mark Zuckerberg on WhatsApp, the NSA, and Bringing Internet to the World
For Mark Zuckerberg, connecting 1.2 billion people to Facebook is just a very good start.
On stage at the Mobile World Congress Monday, the young founder laid out his plan to bring access to the Internet to billions more people through the nonprofit organization Internet.org.
Of course, he didn't get off that easy. Tech journalist David Kirkpatrick, author of "The Facebook Effect" also pressed Zuckerberg on other hot-button issues like his recent $19 billion purchase of WhatsApp, his thoughts on the the NSA, how he plans to make money by giving the Internet away for free, and whether he'll ever take another stab at buying Snapchat.
Here are some of the highlights from the interview:
On Facebook's $19 billion WhatsApp acquisition:
Though Zuckerberg made it clear that his primary purpose for appearing at the Mobile World Congress was to discuss Internet.org, Kirkpatrick kicked things off by asking him why WhatsApp was worth the whopping $19 billion Facebook shelled out for it.
For starters, Zuckerberg said, WhatsApp has the numbers. "It's on a path to connecting more than a billion people. There are very few services in the world that can reach that level," he said, adding that 70 percent of WhatsApp users use it everyday.
But more importantly, he added, he and WhatsApp CEO Jan Koum share the same views on democratizing the Internet. "When we first met, we really started talking about what is was going to be like to connect everyone in the world," Zuckerberg said. "It wasn't until we got aligned on that vision that we started talking about numbers and decided to make a deal... It's that shared goal to help connect everyone in the world."
Later on, Zuckerberg added that by being part of Facebook, WhatsApp's team, which will continue to operate autonomously, would be able to focus exclusively on connecting more people, rather than sorting out its business model independently.
But is it really worth a whopping $19 billion? Zuckerberg said yes, before adding, "I could be wrong. There's a chance that this is the one service that gets to one billion people and ends up not being that valuable. But I don't think I am."
Zuckerberg maintained that WhatsApp will continue to operate as it always has, the subtext being that he doesn't intend to start collecting data from service's users. "Not only do they not use this content, but they don't even store it," he said. "That message is deleted from WhatsApp's servers almost as soon as it's sent. They've found that's the most important thing. We'd be pretty silly to get in the way of that."
On bringing Internet to the world:
Last August, Facebook teamed up with phone companies, including Samsung, Ericcson, and Nokia to launch Internet.org, which aims to connect people living without the Internet (that's two-thirds of the world) to free or low-cost Internet service.
"After Facebook reached its milestone of helping to connect one billion people, we took a step back and said, 'What problem can we solve next?'" Zuckerberg said Monday of the project's origins.
Expanding Internet access would not only be good for the world, but it could be good for the entire industry innovating online, opening up new markets that have never been penetrated before. According to Zuckerberg, the problem is not that people don't have access to the Internet (80 percent of people, Zuckerberg said, live in an area with 2G or 3G coverage). The problem is convincing people who only have $1 or $2 of disposable income to spend it on the Internet. That's where Internet.org comes in.
By teaming up with phone companies and telecom compaies, Internet.org can offer people free access to a limited number of apps, like Facebook. Once people get used to accessing Facebook and discover other parts of the Internet through Facebook, it will become easier, Zuckerberg says, to "upsell" those customers to more robust data plans. And by robust, Zuckerberg doesn't mean the entire world will be streaming House of Cards on Netflix, but people in developing countries may be willing to pay for add-on services like weather and food pricing data.
In an initial test market in the Phillippines, where Internet.org partnered with Globe Telecom to offer users free access to Facebook and messenger, Zuckerberg said, the number of people using Internet and data has doubled, and Globe's subscriber base grew by 25 percent. Now, Zuckerberg says, he's looking for three to five additional telecom partners to run additional trials with over the next year.
"So it's like a gateway drug?" Kirkpatrick asked wryly.
"We like to think of it as an on-ramp," Zuckerberg replied.
Whatever the end game, it's clear it will take a long (long) time for Facebook or its carrier partners to see a monetary return on this investment. Zuckerberg says early on that his board asked him how this would all be profitable in the near-term. "I cannot construct any model that will add up in the near-term," he admitted. "I think we're probably going to lose money on this for quite a while."
And yet, Zuckerberg said, that's exactly what happened when he started Facebook. "This is clearly good for the world and the global economy and global health," he said. "Over time, if we can deliver, it will probably be good for us, too."
On the NSA and it's impact on technology companies:
"It's not awesome," Zuckerberg said bluntly of the effect the NSA scandal has had on businesses like Facebook. "I think the government blew it on us... They're only now starting to get to the range of where they should have been. This whole thing could have been avoidable, and it would have been a lot better for the Internet."
The one silver lining in all of this, he says, is that it's forced the tech industry to play nice in the sandbox for once. He said, "The issues with the NSA have the industry working together better than they've ever worked before."
On that other service that deletes messages immediately:
"Any comment on Snapchat?" Kirkpatrick asked.
"No," Zuckerberg said, definitively, before adding, "After buying a company for $16 billion, you're probably done for a while.