Uganda, located in East Africa, is a notoriously poor and challenged nation. But today, it also hosts approximately 500 miles of fiber-optic cable that enable its citizens to gain 4G access to the Internet—an advancement that few other regions in Africa can boast about. The cable installation came about through a collaborative effort by Facebook and a local telecommunications provider, Bharti Airtel Inc. It promises to improve the lives of consumers living at the bottom of the pyramid, but it also offers great potential benefits to Facebook.
In sub-Saharan Africa, most online users access the Internet using their mobile phones. This market offers huge room for expansion; for example, only 42 percent of the 43 million people living in Uganda have a mobile phone. Worldwide, approximately 3.8 billion consumers still lack any means to access the web. This gap limits development and education, prompting calls to increase Internet access to the poorest consumers as a form of social responsibility. With increased connectivity, consumers can participate more fully and easily in economic transactions, as well as gain necessary information for their well-being.
These developments could represent a win–win for companies such as Facebook, who need to continue expanding their markets beyond the nearly saturated developed economies. If more consumers use the Internet, more of them are likely to use Facebook too. But this motivation has raised some concerns and regulatory attention. In particular, if Facebook lays the cable and controls access to the web, it has a strong advantage for driving users solely to its site, which could limit competition. Noting similar concerns, legislators in India banned Facebook from offering free access to its services to consumers.
Another issue for Facebook involves national governments’ attitudes toward social media. In Uganda, a recently passed national tax requires consumers to pay a fee to access any social media sites. The rationale for the law, according to Uganda’s President Yoweri Moseveni, is to prevent the spread of false information. However, such taxes and limitations also might signal an attempt to control the information available to people. In Myanmar for example, leaders posted false information on Facebook that, according to a U.N. report, sparked violence and genocidal actions against the Rohingya ethnic minority. The report singled out Facebook for failing to do more to prevent and limit hate speech in the build up to the genocide.
The ethical implications thus are multifaceted. Arguably, Facebook is doing a good thing, by expanding Internet access to some of the poorest populations in the world. But also arguably, it is doing a bad thing, by supporting oppressive government actions. And in yet another argument, maybe it is just trying to grow beyond the developed markets, where it already has reached saturation, and ensure its survival.
- How do Facebook’s efforts to expand in less developed nations necessarily differ from its efforts in more developed countries?
- What unique considerations do companies need to address when they expand globally, especially into countries ruled by non-democratic governments?
Source: Alexandra Wexler, “Facebook Pushes into Africa,” The Wall Street Journal, October 8, 2018