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Why Facebook came to SA first

Facebook has explained why it chose South Africa over Kenya and Nigeria to establish its first African office.

Facebook chose South Africa over Kenya and Nigeria for its first African office because the country has a strong advertising agency ecosystem and the companies it’s worked most closely with to date on the continent are headquartered in the country.

That’s the word from Nicola Mendelsohn, vice-president of Facebook in Europe, the Middle East and Africa.

It chose Johannesburg, recognising that South Africa is the “hub to service the continent”, while also recognising “the fact that Kenya and Nigeria are important markets as well”, Mendelsohn said. She said South Africa also has a “very strong talent hub”, which helped influence the fast-growing social networking company’s decision to invest in the country.

Facebook announced in late June that it was opening its first sales office in Africa in Johannesburg, with the office set to serve businesses across the continent. It declined to say how many people the local office will employ, saying it doesn’t share local employment numbers.

It described its investment as the “first step in furthering our investment in Africa and its people”. It has hired advertising industry executive Nunu Ntshingila-Njeke to head up the African operation. She helped build ad agency Ogilvy’s network in sub-Saharan Africa.

The company said its active user population in Africa has grown by 20% to 120m in June 2015 from 100m in September 2014, with more than 80% of users accessing Facebook from mobile phones.

Mendelsohn said she and a team from Facebook have spent time this week meeting with businesses in South Africa who use the platform to market themselves. “I find them to be some of the most sophisticated users of our platform actually anywhere in the world,” she said.

So-called “over the top” (OTT) providers like Facebook, which also owns instant messaging and Internet voice dialling business WhatsApp, have come under fire in recent months from some local operators.

Though Cell C has chosen to work with OTT companies — for example, offering zero-rated data for WhatsApp and helping Facebook launch its free Web platform in South Africa — rival MTN has been highly critical of OTT providers.

Outgoing MTN South Africa CEO Ahmad Farroukh said in an interview with TechCentral last year that the operator was not prepared to spend billions of dollars building advanced telecommunications networks just so that OTT providers can get a “free ride” by competing with the company using that same costly infrastructure. There had to be some sort of quid pro quo, Farroukh said.

Asked by TechCentral how Facebook intends working with mobile operators in South Africa, and how it intends addressing their fears about the impact OTT companies could have on their businesses, Ebele Okobi, head of public policy for Africa at the social network, said: “We have made a habit of working very directly with the operators. Without their infrastructure, we wouldn’t exist as a business.”

She said Facebook will continue to partner with mobile operators “as we have before”.

“We see ourselves coming into South Africa as part of a community and as part of the ecosystem, not to compete, but really to join together.”  — © 2015 NewsCentral Media

This article was published on Moneyweb with permission from TechCentral. To view the original, please click here.


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Must have taken months of agonising with all the options to consider? Cart or car? Cart or car? Cart or car? Playing stupid to appease not a good tactic, poor back door strategy.

Get real, cart or car? Agonising for months, poor back door strategy.

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