How Far is it Between Facebook and China?

Mark Zuckerberg visited China again. In terms of publicity, I think Mark Zuckerberg really enjoyed his weekend in Beijing. Mr. Zuckerberg spoke with Jack Ma of Alibaba, climbed the Great Wall, and met with the propaganda chief of China. But the highlight of the trip was a picture he posted on Facebook: Mr. Zuckerberg was jogging around the Tiananmen Square of Beijing.

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But ironically, Mr. Zuckerberg might have a hard time logging on the website he founded, unless through a Virtual Private Network, or VPN. Since 2009, Facebook has been blocked in China for around 7 years. Philosophically, this is not acceptable for Mark Zuckerberg, since his ultimate goal is “making the world more open and connected”. From a business perspective, Facebook loses more than 1.4 billion potential users, which consist of 1/5 of the total population on the earth. However, franking speaking, Mark Zuckerberg is doing his best to seek access to Facebook in China.

In 2015, when China’s Internet Chief, Wei Lu, visited Facebook’s headquarter, Mr. Zuckerberg told this powerful Chinese official that he was reading a book called The Governance of China, written by Chinese president Xi Jinping.

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Also in 2015, when Chinese president Xi Jinping visited the United States, Mark Zuckerberg politely asked Mr. Xi to name for his future daughter. However, this proposal was rejected by Mr. Xi since naming a kid would “bear a huge responsibility”.

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Even as Mr. Zuckerberg was making a speech, he wouldn’t forget courting China. In his speech at Tsinghua University in Beijing, he filled his remarks with compliments on the nation’s history and with idioms of traditional Chinese wisdom. Speaking in Mandarin Chinese, Mr. Zuckerberg stated that “there is a good Chinese saying, which says that if you work at it hard enough, you can grind an iron bar into a needle,” he said. “If you keep working hard, you will change the world.”

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But despite of his hard work, there is still not a clear timeline of when Facebook can be accessible in China. Politically, Facebook is a threat to Chinese government. Ever since 2009 race riots in Xinjiang Province, Facebook is banned in China unless through a cumbersome and often expensive workaround called a virtual private network, or VPN. The Chinese government is allergic to any digital technology that could be used to organize the masses outside of the authorities’ purview. Websites or keywords deemed politically sensitive are censored. YouTube, Google and Twitter are blocked by the Great Firewall.

From a business perspective, the Chinese government prefers seeing local technology companies, instead of western ones, thrive in China. Domestic alternatives, including Tencent’s WeChat, Sina’s Weibo and Baidu Tieba are gaining increasing popularity. These Chinese technology giants, though popular among the nation’s nearly 670 million digital population, are willing to be under constant monitoring and censorship. On the other hand, the development of such local firms is crucial to China’s great efforts to encourage innovation. With China’s export-led growth slowing down, its central strategists want to shift the economy up the value-adding ladder. For example, when the Chinese government tends to reinforce its Internet Plus strategy, its Internet policy is designed to incubate homegrown firms like Tecent and Baidu while discourage reliance on foreign companies such as Google and Facebook.

But can we say that there is absolutely no chance for Facebook to enter China? Probably not. Over the past few years, some other American technology companies have offered examples to Facebook in terms of how to deal with the Chinese government. LinkedIn, the professional social network, is allowed to provide service in China by working with two politically-connected Chinese venture capital firms and censoring sensitive content on its China network. Uber, which has experienced huge growth in China during the past two years, has moved quickly to ensure that all its customer data is stored within China to comply with regulations there.

The problem is whether Mr. Zuckerberg is willing to accept a version of the social-media service that submits to local censorship rules? For an idealist like Mark Zuckerberg, perhaps no Facebook at all is still better than the censored “Facebook Lite”. Another problem is does it worth Facebook to enter China under such huge political and business risks? Maybe Facebook has overrated its popularity in China. It’s hard to see how Facebook could achieve a meaningful market share as a new entrant in China’s social media market, given the dominance of existing players like Tencent, Baidu and Sina, let alone regulatory issues.

Until now, Facebook still has a long way to go.

 

7 comments

  1. This has been, and will continue to be, a major issue for Facebook. It was really helpful to learn more about the details of the situation and about the perspectives on each side. I find it interesting to hear about the different things Mark Zuckerberg is doing in order to attempt to enter the Chinese market. I wonder if people in China have been wanting Facebook, and will therefore give up the existing platforms such as Tencent, Baidu, and Sina if Facebook enters the market. However, if all of their friends are on these existing platforms, there is a chance it would not be worth the switch. I assume Zuckerberg and Facebook have done a lot of research into this and would not be trying so hard if there was not a lot of potential here.

  2. Great post! Caroline makes a good point in wondering if users in China will even want to switch to Facebook when/if it is able to pass the Great Firewall. I agree that it really depends on the network–if their friends switch, they will switch. But I think the question is if Facebook really should be in China. If the existing platforms now are serving users well, then why push another platform into a political climate that won’t accept it? Clearly, Zuckerberg is trying his best to court China, but it seems that they won’t be changing their internet restrictions anytime soon. I agree with you that as an idealist he probably thinks that no Facebook at all may be better than a restricted version of it. We will have to wait and see what happens!

  3. Super interesting post! This topic keeps coming up and it was great to learn more about it. I totally agree with Amanda and Caroline that getting Chinese users to switch is key. My gut feeling is that knowing the global reach of Facebook, they would certainly be inclined to try it. The issue of no Facebook at all vs a “lite version” is interesting. I wonder what the “lite version” would look like and if it would be at all worth Zuckerberg’s while to try it and at least introduce the Chinese users to the brand with hopes of someday launching the full on site?

  4. I think you raised some great points here. The most pervasive for me deals with Facebook “Lite” and how Zuck may or may not implement it. My perspective stems from Facebook’s existing network of users implementing a different platform than the one with which we’re familiar. Hasn’t the company rolled out mobile versions of the app tailored for India and other places with less powerful mobile computing capabilities? I think if Zuck had the chance to penetrate the Chinese market with a similar version, he would jump out of his pants at the opportunity. I don’t think he would hesitate at all. Some of the other comments regarding the questionable nature of this market don’t necessarily add up for me, considering the staggering figure of 670 million digitally equipped in China. Zuck won’t pass up the growth potential, in my opinion. Would he craft a custom version of Facebook to compete? Absolutely. It’d be a huge mistake otherwise, especially considering how much money the company can pump into the effort. Cheers, and thanks for the great post!

  5. You can definitely see Zuckerberg trying to finagle his way into China. The stat that China makes up 1/5 of the world population is insane. Which is why it is easy to understand how this can be such a big problem for Facebook. With this immense audience not even able to access it, FB is not completing their goal of connecting the world. These alternatives to FB that you mentioned I am curious to see what their platforms are like, and what sort of content they have on them. Because I really dont think FB will put out the Lite version so China better stay familiar with what they have.

  6. Great topic! I find globalization and localization fascinating. It was be very interesting to see what Facebook’s next move will be in China. I agree with Michael’s comment that Zuckerberg would jump at any opportunity to get his foot in China’s door. I’m curious to what the government thinks it’s people will post versus what the people will actually post. It’s very promising that LinkedIn has been able to make its way in.

  7. I doubt Facebook will ever enter China. Google did a few years back, eventually having to pull out due to all sorts of censorship and piracy concerns. I suspect more likely would be a FB investment in some China SM platforms or purchasing a startup (like WhatsApp).

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