Facebook vs Mahesh Murthy on Free Basics

The ongoing war between Facebook and Mahesh Murthy on Free Basics.

Mahesh Murthy vs Facebook Free Basics. (Photo: The Quint)

Indian venture capitalist Mahesh Murthy recently wrote a piece, which was republished on The Quint, that took a critical look at Facebook’s Free Basics. Now, Facebook has issued a clarification on Mahesh Murthy’s stand in an article published on The Wire. To this, Murthy has, once again, put forth his arguments.

Is Free Basics Really Open For All?

Facebook’s advertisement claims that “Any publisher or developers can have their content on Free Basics. Nearly 800 developers have already signed their support for Free Basics.”

<p>Who said they can’t? But the big sites don’t. They don’t want Facebook to own their customers, and they don’t want Facebook to snoop on their customer data, because all traffic goes via Facebook servers.<br></p>

<p><b>Mahesh Murthy</b></p>

<p>Many large sites participate in Free Basics including India Today, Network 18, Accuweather, BBC, Bing and literally hundreds more around the globe. The concern of net neutrality activists with our original program was that small sites would be locked out. We listened and responded to that concern, so we opened the platform and we’ve been thrilled that small sites have chosen to be a part of the program. Regarding your privacy concerns, we do not keep any customer personally identifiable information (PII) past 90 days.</p>

<p><b> Facebook</b></p>

<p>Only two of India’s top 40 sites, as ranked by Alexa, are in the list of Free Basics sites released by Facebook – and one of those is Facebook itself. The other is Wikipedia.<br></p><p>Even when the user goes to Bing to search – her bits and bytes go via Facebook servers.</p>

<p> <b>Mahesh Murthy</b></p>

Though Facebook guarantees that they are currently keeping your data for just 90 days, Murthy says it is as safe as the wolf saying, trust me, I’m guarding the sheep.

Stuck in Facebook Jail

Facebook’s advertisement claims it is not a walled garden. 40% of users go on to access and pay for the full Internet within 30 days, it claims.

<p>Which means 60% of their users are stuck in Facebook jail</p>

<p><b>Mahesh Murthy</b><br></p>

<p>Facebook responds by saying that of the 60% people, only 5% are using only free services. 55% have churned (normal in this scenario). The 5% they hoped are using the tools to access health information, communicate with people, or find a job.</p>

<p><br></p>

<p>As of October, about 1 million people had logged on to Free Basics.<br></p><p>Of these, about 80% by Facebook’s own admission were already users of the full Internet who dropped in to try the offering of free data. They’re not, as Facebook puts it “people who started their online journey on Free Basics”. That leaves around 200,000 people who were newbies who actually came on board. Of these, 80,000 or 40% went on to the full internet, and the rest 60%, that is 120,000, were locked in the Facebook walled garden. </p><p>And of the 120,000 who were locked in the walled garden, almost all of them: 110,000 dropped out and never came back again (the 55% of 200,000 who have “churned”) – perhaps disappointed with what they saw there. And 10,000 continue to remain locked in there.</p>

<p><b>Mahesh Murthy</b><br></p>

Photo from the Technical Guidelines (Photo Courtesy: Facebook)

Popular in 36 Countries? Which Ones?

Facebook’s advertisement claims that Free Basics is growing and popular in 36 countries.

Murthy writes this off as a lie.

<p>This scam may have been pushed through in African nations who have no experience of anything better online-progressive countries like Japan, Norway, Finland, Estonia and Netherlands have outright banned programs such as Free Basics. Facebook has since spent a large amount of cash in ads, lobbying, diplomacy and PR to try to get it unbanned here. They’ve managed to re-open a closed issue, again.<br></p>

<p><b>Mahesh Murthy</b></p>

<p>Your characterisation of these countries is rather insulting. We wouldn’t categorize them all as poor and we wouldn’t categorize any as helpless. The list includes Columbia, Philippines, Thailand, Bolivia, Peru, Mexico, Pakistan, Mongolia, Bangladesh, Panama, Mongolia, Iraq and others. </p>

<p> <b>Facebook</b></p>

Murthy, in response to Facebook condemning him, lashed out explaining that he called the countries “poor” with reference to their GDP and other economic norms and not as some imaginary “insult” or “arrogance”. He also pointed out that while “Columbia” is in the US, Facebook may have meant Colombia, the country.

Then, going a step forward, he asked ‘Hypocrite’ Facebook, to try to bring the same net neutrality to the US which has almost 50 million unconnected people.

Mark Zuckerberg, founder and CEO of Facebook, addresses a gathering during the Internet.org Summit in New Delhi October 9, 2014. (Photo: Reuters)

The Issue of Support from 3.2 Million People

Facebook’s advertisement claimed that in a recent representative poll, 86% of Indians supported Free Basics. It added that, in the past several days, 3.2 million people have petitioned TRAI in support of Free Basics.

Murthy ripped apart the poll, saying Facebook published many misleading polls apparently asking to support “connecting India” or “free Internet”.

<p> They never brought you both sides of the story, to take a fair decision. 3.2 million people out of Facebook’s base of 130 million people who were repeatedly shown a misleading petition by Facebook on top of their pages clicked yes and submit, without being told both sides of the story, and thinking they were doing something for a noble cause, and not to further Facebook’s business strategy.</p>

<p><b>Mahesh Murthy</b></p>

<p>This is false. This was a door to door in person poll of more than 3,000 people in India. Link is <a href="http://www.prnewswire.co.in/news-releases/survey-suggests-widespread-support-for-free-basics-across-india-563227551.html">here</a>.</p>

<p><b>Facebook</b></p>

As for the online petitions, Facebook claims that it sent a notification to people who had previously indicated their support of Free Basics denying any evidence that a ‘large number’ feel conned.

<p> No one could sensibly answer “yes” to both statements: “the Internet should be open to everyone” and “I support a program like Free Basics that takes people away from the full Internet”. </p>

<p> <b>Mahesh Murthy</b></p>

Thanking Facebook for confirming that the campaign was not representative, Murthy asked why Facebook brandished a number like 3.2 million that they themselves admit is heavily influenced by selection-biased and is not representative at all.

Activists in India are hounding Facebook’s Free Basics and hiding stuff from you. (Photo: Facebook)

No Revenue From Free Basics?

The advertisement claimed that Facebook on Free Basics has no ads. Facebook produces no revenue. We are doing this to connect India and the benefits to do so are clear.

<p>The intentional half-truth: It may not produce revenues from this Free Basics YET because the current version of Facebook on it has no ads YET.</p>

<p><b>Mahesh Murthy</b></p>

<p>There have never been ads in the version of Facebook in Free Basics. Ever. What if we find out that an ad-based model down the road has better conversion to the full Internet and better serves the unconnected? We don’t think that’s likely, but this is why we do not want to say “never.”</p>

<p><b>Free Basics</b></p>

Murthy ignores the explanation saying Facebook is just going round and round in circles. He says, “Facebook doesn’t have ads yet, but reserves the right to bring in ads at any point in time. Nothing new here.”

(The Quint does not necessarily subscribe to or endorse the views of Facebook Free Basics or Mahesh Murthy.)