Facebook Co-Founder and CEO Mark Zuckerberg dined with about 20 executives from wireless carriers Monday night in Barcelona, Spain, site of the 2014 GSMA Mobile World Congress, Bloomberg reported, and the conversation at the private dinner may have been guarded, given the wireless industry’s concerns over the threat that the social network’s most recent acquisition, cross-platform mobile messaging company WhatsApp, presents to their text-messaging services.
The purpose of the dinner meeting, according to Bloomberg, was to discuss the Internet.org initiative spearheaded by Zuckerberg and the potential of teaming up with the wireless carriers to help bring free Internet access to emerging markets, but the specter of WhatsApp likely made its presence felt at the dinner table.
Ovum Analyst Eden Zoller said in a research note, as reported by Bloomberg:
Zuckerberg’s proposal is Facebook-centric, with the social network and OTT (over-the-top content) players reaping the immediate benefits. The direct monetization prospects for telcos are thin. The question remains as to whether this will be enough to counter the negative impact OTT services are having on operators.
Orange CEO Stephane Richard, who attended the dinner, said during an interview at the conference earlier in the week, as reported by Bloomberg:
The risk for us is being excluded from the world of services. If that happens, we’ll be downgraded to simple pipes.
A service like WhatsApp, to be honest, that’s something we could’ve and should’ve come up with before. We’re well decided to catch up.
Telecom Italia CEO Marco Patuano also said in an interview earlier this week, according to Bloomberg:
Over-the-top operators have no intentions of investing in fiber networks. The Facebook-WhatsApp deal teaches us that with $19 billion, Facebook could have built new fiber networks in both Italy and France.
And Bloomberg reported that Vodafone Group CEO Vittorio Colao chimed in:
Facebook’s is the first biggest inorganic deal — a 1.2 billion-customer company acquiring another with 450 million clients. And you’re asking me whether Ireland (Hutchison Whampoa’s $1.1 billion acquisition of an Irish carrier) will go through? The world is clearly changing, and old regulation doesn’t fit this world anymore.
Readers: How will Facebook’s acquisition of WhatsApp play out for wireless carriers?
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