The Digital Skeptic: Facebook Has Many Mouths to Feed in Global Market
Is this some sort of scam? I wondered. Absolutely not, I was told.
What's happening is most Facebook users in India are mobile users. The Telecom Regulatory Authority of India says a full 908 million Indians , out of a total population of 1.2 billion, rely on their mobile phones to communicate, compared with 33 million with wireline access.
The problem is, of course, mobile phones don't take cash. They must rely on electronic means to top up and, in turn, a networked banking system that essentially does not exist in India. According to the New America Foundation , despite a major government-sponsored effort to promote a modern bank infrastructure, only half of Indians have access to banking facilities. Indians rely mostly on a hodgepodge of third-party methods to buy stuff with phones. They include operations such as Obopay, YES Bank , Paymate and Paytm, just to name a few.
Each of which seek a cut of every dollar they touch -- which makes it darn tough for Indian consumers to do business with Web-based services such as Facebook.
When Apurva Chaudhary, who works with me from Mumbai, tested what it would take to order a promoted post, she was faced with the same choice of 99 rupees for a cellphone-based payment or 19 rupees if she paid with something called MOLpoints. This is yet another payment system created by a Malaysia-based commerce company called MOL -- which is used heavily by online gamers, among others.
For MOL, Facebook is a nonentity. And it showed.
As hard as she tried to get MOL to take her her 19 rupees to give to Facebook, it would not work. Apparently, her service provider was not properly supported. Customer support did not return calls. Carriers for customer service and public relations did not return calls. There is no support number for Facebook in India.
"It's like Facebook doesn't want my money," she told me in frustration.
The wrong side of the 80/20 split
This leads investors smack dab into yet more dark territory for global Web-based services. Sure, Facebook hopes it will do business in fast-growing markets such as India. The problem is, the infrastructure it relies on here in the U.S. is not in place overseas. That means almost wherever it turns, third parties must enable functionality, which take a fat piece of the action and raises the complexity. This all puts Facebook's already razor-thin margins even more at risk.
Sure Facebook figuring out how to get paid here in the US will be tough. But how this company figures out how to get paid in disorganized global markets will be that much tougher.
Like I said, it's never easy getting paid.