Each Saturday, Farhad Manjoo and Mike Isaac, technology reporters at The New York Times, review the week’s news, offering analysis and maybe a joke or two about the most important developments in the tech industry.
Mike: Hello, Farhad! How has your week been? I’m weighing what to do for Valentine’s Day this Sunday. My prospects include “sitting on couch with dog eating a burrito bowl” and “other.”
Farhad: Ah, I see you’re really getting into the spirit of Married Valentine’s. My wife and I are probably going to clean the garage and maybe go furniture shopping. If you catch my drift.
Mike: Cool. Well, at some point I want to be eating a large box of old Russell Stover chocolates in bed, preferably in the dark to minimize the shame factor.
Onto tech! This week was weird. Twitter announced its quarterly earnings and, surprise, surprise, user growth has flattened. I’m tired of talking about Twitter, so let’s just move on.
Farhad: Wait a second, you didn’t mention my idea for Twitter! As I argued in a column this week, I think it’s bogus that the stock market expects it to keep adding more users. When’s enough enough? In other words: I became a communist. I think Twitter should be a public utility.
Mike: Yeah, whatever, Chairman Manjoo. Also, I wrote a story on food delivery start-ups — and the questionable economics behind at least some of them — that I am not above promoting to our newsletter readers. Please go read that.
Google keeps getting bad news from regulators in Europe, which is really boring but also important, so I will link to it here. A bunch of giant Chinese tech companies bought Opera, a browser company, for $1.2 billion. Also boring, also significant, say people who know how ad networks function.
Oh, and tech stocks in general are doing a dramatic re-enactment of Francis Ford Coppola’s “Apocalypse Now,” so that’s exciting. Also terrible for people who, you know, own tech stocks.
Farhad: Hey, you forgot Zenefits! That’s the health insurance and human resources start-up that has seen meteoric growth over the last two years. This week it hit a potentially catastrophic roadblock. After reports that it had skirted insurance regulations, Zenefits’ chief executive, Parker Conrad, left the company and the board. Now the firm is vowing to clean up shop, but things sure don’t look good for it.
Mike: Not very Zen if you ask me.
Farhad: But what we should really talk about is Facebook’s plan to connect the world. This week regulators in India blocked Facebook’s Free Basics program, which would have given people free access to Facebook and other Internet services. The regulators opposed Facebook’s plan to give priority to some websites — including Facebook itself — over others as part of Free Basics. The plan was a major component of Internet.org, Mark Zuckerberg’s program to provide Internet connectivity to the developing world.
So is this ruling the end of that plan? And what should this loss tell us about Silicon Valley techies’ approach to the rest of the world?
Mike: First, it is definitely a huge blow to Facebook’s efforts in spreading across India, something the company has invested untold millions of dollars and resources in furthering. Free Basics and Internet.org is a passion project of Zuckerberg. His claim is clothed in altruism: Facebook truly thinks everyone should be connected to the Internet to better improve their lives.
Of course, you could view this in a different lens of enlightened self-interest. Obviously Facebook wants to bring as many people online as possible, as that means more customers, more money and more control for Facebook.
Farhad: You reporters are such cynics. What, you don’t believe a corporation would invest millions just to help humanity?
Mike: You’re such a sweet child. When Oculus is finally released I will make a note to virtually pet your head.
But there’s the more paternalistic view of Facebook enacting a kind of modern-day colonialism — similar to, say, what the British Empire carried out in India more than a century ago. Facebook isn’t offering the full, open Internet. The company is offering a set of services that it thinks people should have, including free data access to Facebook. The assumption, by some, is that Facebook knows what is best, and that Indians should listen to and happily accept what the benevolent corporation has to offer.
Facebook resists on this line of thought, but Marc Andreessen’s comments this week — which essentially reinforced this point of view — did not help Facebook’s case. (Andreessen, who is a Facebook board member, received a pretty epic smackdown from Zuckerberg 12 hours later.)
So, in essence, I have no idea what Facebook’s recourse is from here, legally or strategically speaking. I’m not even sure if the company knows. What do you think? Has the sun finally set on the Facebook empire?
Farhad: I think it will need to — and probably will — rethink the whole plan. Luckily for Facebook, it has a good track record of transforming an initial disaster into a long-term success. (We recently talked about how they did it for their mobile strategy.)
The way forward seems pretty obvious to me: Facebook can offer a new free or low-cost plan that doesn’t limit what people do on the service. As some Indian tech entrepreneurs have pointed out, there are already carriers in India that offer these sorts of supercheap but unrestricted Internet plans.
Now, why would Facebook want to give Indians a free Internet plan that doesn’t favor its own services? Because it would still win in the end. Facebook and its subsidiaries — WhatsApp, especially — are extremely popular in India, as in the rest of the world. If people sign up to the Internet, there’s a very good bet they’ll use these services even if they’re not being forced to.
Mike: I’d bet at least in the short term, Facebook stays quiet on this front. The ruling in India affected all “zero data” plan providers, including those offered by mobile operators that aren’t working with Facebook. Since Facebook has been in the spotlight for months on this, my guess is it will let the operators do the fighting.
Farhad: Finally, and most important, offering a plan that doesn’t restrict what people can do would be a hell of lot less condescending and paternalistic. In an excellent piece on Medium this week, Sumanth Raghavendra, an Indian tech entrepreneur, wrote “the explosion of mobile phone usage in India even among folks who could be regarded as ‘poor’ aptly demonstrates that contrary to what some people might believe, poor people are more than capable of demonstrating agency and adopting technology on their own — as long as they see a clear and visible path towards a better standard of living.”
Zuckerberg and other techies have long argued that the Internet will improve the lives of people in the developing world. Offering a low-cost plan that offers the full Internet would be a good way to prove that.
Mike: What they should probably do is talk up all the other parts of Internet.org that aren’t just the Free Basics India initiative. They’re working on drones, free Wi-Fi, all sorts of other stuff that isn’t limited to Free Basics. When Zuckerberg keynotes the Mobile World Congress conference in a few weeks, I’d watch for him to play that stuff up there.
Anyway, I’m tired and need to figure out what burrito bowl to colonize on my couch this weekend. Should I use Postmates, DoorDash or Seamless?
Farhad: I just heard of an on-demand massage start-up. That’s obviously the way to go. See you next week!