Will Facebook Enter China?
As Facebook is set the launch the most-anticipated IPO in years, observers are wondering if and when the company will attempt to enter the China market. From BBC:
Analysts say the longer Facebook takes to enter China, the harder it will become for the firm to crack the market.
“The point is that they have already missed out on it,” Michael Clendenin of Red Tech Advisors in Beijing tells the BBC.
“They will be naive to think that just because they are Facebook they will be able to come in and capture the market.”
China already has a thriving and fast-growing social networking market and the sector is controlled by domestic players.
While Facebook faces concerns about the durability of its business model, which relies heavily on advertising, some analysts believe the social networking behemoth will seek to enter China, where its services are not yet available, to grow revenue.
In its original prospectus filed with the US Securities and Exchange Commission in February, China was mentioned nine times, clearing indicating “the country is under serious consideration as a new market for the social network”, said Jon Russell, Asia editor of NextWeb, a technology site.
“It’s very likely that Facebook’s goal is to expand very rapidly. It is looking at China because it’s the only field left open for them,” said Jeffrey Barlow, director of the Berglund Center for Internet Studies at Pacific University in Oregon.
While China Daily acknowledges that Facebook services “are not available” in China, it does not explain the reasons: The site has been blocked by the Great Firewall of China since 2009. As a result, in an infographic on Facebook use in Asia, China is missing.