Exploring the Dubious Maths Behind Facebook’s Free Basics

Last month, Facebook claimed in its newspaper ads, “In India, more than 40% of users coming online for the first time with Free Basics pay for access to the full Internet within 30 days of joining Free Basics”. So instead of being a walled garden that would limit people within its confines, Facebook suggests Free Basics is responsible for initiating and converting the hitherto unconnected millions to the wider Internet. However, on a closer look, this 40% conversion number raises more questions on the basis it seems to have been calculated.

These users may not have “come online for the first time with Free Basics”

To understand how Facebook would identify someone as a first time Internet user, we need to understand how tracking works in the online world. A digital company such as Facebook, needs some kind of identity tracking to know a user’s  Internet usage and behaviour over time. If a user has never appeared on Facebook’s network – Facebook has very limited ways to know anything about him. In case of PC web, Facebook might still be able to use cookies to build a rough browser based identity if a user visits a site which has “login/like/share facebook plugin” on the page. However, in case of mobile web/apps, the concept of cookies doesn’t work. While some mobile apps integrate Facebook advertising SDK in their code, which may help Facebook with tracking a user’s lifetime journey, other leading players such as Google, Yahoo or Amazon won’t put it because of competitive reasons. Hence, creating an account and logging to Facebook is mandatory for Facebook to know a user’s identity.

A second way for Facebook to track a Free Basics user is through Reliance Communications, its sole telecom partner in India. Using this approach, Facebook would most likely identify an Indian mobile user as coming online for the first time, if he hasn’t bought a mobile  Internet data plan on Reliance before using Free Basics (No Reliance Identity), or if he has never created an account on Facebook before using Free Basics (No Facebook Identity).

Despite employing both these approaches Facebook can miss a first time user. If prior to signing up for Free Basics, users have used mobile data only on a non-Reliance connection and never yet used Facebook, neither Facebook nor Reliance can establish how they began they began their online journey. In India this number is likely to be rather large due to several factors.

First, many mobile users in India, (48% according to OpenSignal, a London based Network analytics company) are on multi sim devices, with each of their SIMs likely to be from different telecom networks. As of 23-Jan-2016, 96.8% of Internet enabled mobile handsets available on sale on Flipkart below the price of Rs. 10,000/- are dual SIM handsets. Second, given Reliance is a laggard in a Telecom space where Airtel, Vodafone and Idea Cellular combined command 91% of revenue, it is highly likely that many Reliance users have infact already used the Internet on the other network they subscribe to. Further, not all online Indians are on Facebook. As per IAMAI and other industry figures, India has anywhere between 300-400 million active mobile Internet users. Facebook’s own advertising dashboard shows that it is used by roughly 115 million Indians each month via mobile phones. This suggests that above 60% of online Indians don’t use Facebook at all. This also includes many who may may have tried Facebook in the past (on a non-Reliance SIM), but now choose not to use Facebook at all on Free Basics (on a Reliance SIM). Finally, a Free Basics user with a single sim phone also could have used data on another mobile network before they switched to Reliance and signed up for Free Basics. With high penetration of prepaid connections and mobile number portability, the barrier to switching connections is even lower in a market, where the churn rate is anyway very high. All these user types we just identified, would get incorrectly counted as first time Internet users. And their numbers could be significant.

Pre-Free Basics: How Facebook would identify a first time Internet user incorrectly

Multi-SIM user Operator Used for accessing Mobile Data Sites visited (lifetime)
SIM 1 Airtel Yes Non-Facebook only
SIM 2 Reliance No NA

Due to absence of a prior Reliance identity or a Facebook identity, Free Basics would incorrectly identify this multi-SIM user as first time Internet user, even though he’s already using his Airtel SIM for accessing non-Facebook sites.

How many first time Internet users on Free Basics have really converted to paid Internet?

In May 2015, Facebook had said that out of 800,000 users who had used in India till then (as Free Basics was formerly called), only 20% were previously not active on mobile data, or first time Internet users. In October 2015, Reliance Communications said that 1 million Indian users had experienced Free Basics. A rough extrapolation on this base of 1 million suggests that only 200,000 users on Free Basics platform were first time Internet users.

Applying the 40% conversion number, given by Facebook in December 2015, gives us 80,000 users who finally converted to the full Internet. However, as explained above, if most of these 80,000 could be multi-SIM users, Facebook has no way to know how many of these are really first time  Internet users and therefore, how many of them could even be called “converted users” attributable to Free Basics. This is important as Facebook has primarily promoted Free Basics as a platform to experience Internet for the first time with zero data charges. In absence of achieving this goal, it just remains a walled garden restricting its users to selected confines of the Internet.

Several research studies, including one by an author of this article which was previously covered in The Wire, have found that Internet walled gardens such as Great Firewall in China have lasting influence on user behavior. In essence, after spending some time within the confines of these “gardens”, users tend to rarely look outside, even when they are free to venture outside.

In a country where, Internet penetration and usage is anyway growing, and 100 million people joined the Internet in 2015 alone, the claim that Free Basics is responsible for getting them online (to the open access Internet) is unverifiable. The causal link between getting on Free Basics and converting to the paid Internet can only be established by comparing differences in Internet adoption between two similar groups, one that had Free Basics and one that didn’t, provided users were randomly assigned to either of these groups. With voluntary sign ups, it is quite possible that people who converted were anyway more likely to start using the Internet. Especially if they were not true first time users, this is even more probable.

True first time users and role of incentives (such as Free Basics) in converting non users into into active Internet users requires panel studies that track people’s usage over time. Such studies may aid formulate a long term public policy to convert majority of Indians into Internet users.

Both authors contributed equally to the article

Himanshu Gupta (@halfrebel, blog) is a digital marketing professional who previously headed India Marketing & Strategy role for Tencent’s WeChat between the years 2013-15.

Harsh Taneja (@harsht, is a an assistant professor at Missouri School of Journalism whose research focuses on audience behavior, including Internet use.

  • Byunghun Yoo

    Interesting. no free food in the end…