An awesome map of Facebook's connections around the world. China is conspicuously absent.

Mark Zuckerberg’s visit has sparked media speculation that Facebook will set up operations in China, despite all evidence that it’s simply a personal visit coupled with personal curiosity.

Quora has an excellent thread on Zuckerberg’s visit that discusses two different options should Facebook seek to access the China market:

  1. A censored or separate Facebook
  2. Provide free technology to circumvent The Great Firewall

I argue that neither is likely for the foreseeable future. Instead, the likely course is a continuation of the status quo: no Facebook China. Facebook neither appeases nor pisses off the Chinese government (with circumvention technology). Instead, it concentrates on encircling China by dominating the neighboring markets in Russia, Korea, and Japan. If it succeeds, Facebook has then conquered every major nation on earth except China.

If Facebook is keen to establish a China presence, the most realistic step is to open a Beijing office for R&D, serving HK and Taiwan, and helping Chinese Facebook developers (who are surprisingly numerous (see the Top 10 Chinese Developers) and love Facebook). Facebook currently has 10 offices in the US, plus offices in the Ireland, the UK, Germany, Spain, Italy, France, Sweden, Australia, Japan, and India. China would be its first office in a market it has not yet conquered.

1) A Censored or Separate Facebook China

A Facebook that appeases the Chinese government might be a net positive for Chinese netizens, but I think it’d be a disaster for Facebook. It would piss off far more than just ‘rights groups.’ The storm would be more akin to Yahoo turning over the details of dissident Shi Tao‘s email account (and leading to his imprisonment), for which they were decried far and wide in the general public.

I see no implementation of “Facebook China” that could appease the government without infuriating Western/international users and/or jeopardizing its global interconnectedness (which would also be its competitive advantage in China). Questions to consider:

  • Who would “Facebook China” censor and who not?
  • How would Facebook wall off the accounts of young Chinese who study overseas, set up accounts, and return to China?
  • Would Facebook stop current news, like Nobel winner Liu Xiaobo, from spreading and trending?
  • Would it turn over the personal details tied to accounts?

China’s social networks (QQ, RenRen, Kaixin001, etc.) employ long ban lists of sensitive terms (both political and pornographic) and warehouses full of manual censors (who click through images and videos for sensitive content all day long). All “cooperate” with government requests. I can foresee the articles, “NYT Interview with One of Facebook’s 1000 Censors in China” and “The 50,000+ Terms That Facebook Blocks You from Sharing with your Chinese Friends.” Absolute nightmare.

Facebook does censor in other nations (e.g, Germany (Nazis) and Pakistan (images of the prophet)), but it’s limited to a few extreme cases. And which Western internet service with user-generated content has succeeded in appeasing the Chinese government anyway? Google’s content is far less sensitive and even that went too far for them. To be fair, MySpace did try a censored, walled off China version of its service (and I’m shocked it didn’t generate more outcry), but it never caught on. I don’t see this as a workable solution.

2) Provide Free Technology to Circumvent the Great Firewall

In his insightful post, “Mark Zuckerberg and China – A Love Story,“ Bill Bishop writes:

My (unsolicited) advice? Don’t try to set up operations in China. Instead, build and distribute free circumvention tools that allow Chinese users to scale the Great Firewall and join the global Facebook community. Chinese netizens will love you for it. The government will not love you, but let’s be realistic. The government never has and never will love you Facebook, no matter what you do.

This, by contrast, is a superb way for Facebook to piss off the Chinese government (and Iran, Vietnam, etc.). I doubt Zuckerberg would be very welcome on his next trip to China–he’d be toxic for China’s internet CEOs to touch.

This tactic would divide the Chinese population. Many techies and internationalized Chinese would love Facebook for this. And many more nationalist Chinese would hate it. And for the vast majority of Chinese who don’t know a thing about Facebook? They’d hear about it from the state-owned media as “some foreign social network that meddles in China’s internal affairs.”

If Facebook embraced this approach, it’d win goodwill in the West and with rights groups. Facebook would stand for something, which I think Zuckerberg is actually keen upon–he’s always driven it towards a more open, transparent platform after his own vision.

And if Facebook decides to wait until China opens up, this would be great branding for that day: connect with the world and freedom. If that day ever comes, I’d likely short China’s copycats (RenRen and Kaixin001 plan to IPO soon).

I’m of the view that Facebook would have won if China were a free market, but but alas that’s a mere hypothetical (and there is a strong counterargument). Now that local copycats like RenRen are more entrenched it would be more difficult for Facebook to win, though I believe still likely. Zuckerberg may prove me wrong, but I don’t expect RenRen to be a stop on his trip.

Zuckerberg is in China. An R&D office is conceivable. Facebook China? Not so much.

  • TeaWithCarl

    Hi Kai -

    Here’s a 3rd option – Favebook, Google, Twitter (US govt, GM, thousands of locked out US corporations – the list is huge) – quietly behind the scenes finance disruptive technology.

    For instance – quite inexpensively – GOOG, FB, Twitter “scrape” e People Table (1.3 billion rows) datasets for China – post it open source for free – then crowd source YouTube, Twitter, Google Translate – you’d have an explosive datasets ( and bingual television station).

    ANY PERSON in China could slam the reputation of a corrupt official, thug policeman, etc

    Activists threatened by jail – could real- time POINT their cellphone video cameras on any policeman, official, or situation – and say YOU’RE on LIVE TV “.

    ” Not only are you NOT going to put me In jail, but I’m making a LIVE video that will put you in jail when democracy comes. Your reputation matters on live TV.

    Crowd sourcing this via Google Translate onto Justin.TV and YouTube – would allow Engish speakers worldwide to watch it LIVE – with crowd sourced teanslations only lagging 30-60 seconds.

    we’ve only seen the beginning of disruptive technologies – and pissed off forgeign govts and companies – angry at decades of manipulative lockout by Chinese authorities would EASILY justify this method of corporate investment for disruption – an endless stream of financing for activists, people who love China, and people like myself tat china will become even stronger when they adopt world standards for freedom.

    • ERICVALELY

      if only such technology was available for iraqis before they get blown away, raped, or beaten by u.s. soldiers.

  • http://twitter.com/mayline974 Carole WAI HAI

    @TeawithCarl, This is so not gonna happen! “Your reputation matters on live TV (in the West only – Justin.tv and youtube are blocked in China, remember?)”. It would be a mistake for these international companies to pissed of the Chinese gvt. Softpower is what would work best.

    And about Facebook in China, why buying renren (or another chinese social network) could not be considered? Censorship of Chinese content would be left to the Chinese operation site with a censored-free English content. And if facebook.com remains blocked for sensitive English content, it is still possible to develop an application bridging facebook.cn’s content (censored interface so authorised in China) to facebook.com (blocked interface). Meaning that outside China facebook users can access international+chinese content, while in China, users can only access Chinese profiles. That still sucks for returning Chinese who want to keep up with their Foreign friends, but hey! These guys can buy a proxy!

    • ERICVALELY

      americans/westerners only know sabatoge as a way of getting ahead. just read confessions of an economic hitman. they dont know any other way. it has worked up to now, for the past 300 years. if these Chinese want to keep up with their foreign friends so much, then maybe they shouldnt come back. living in China is a privalege, not a right.

      • Alexi

        …living in China is a privalege, not a right…

        Are you on crack? Have you ever been to China? Or are you just one of those insecure China hawks/flame baiters?

        I’ve been there for 5+ and this privilege as you so call it, is something my wife and I are planning on ridding ourselves of as soon as possible. We’ve heard enough BS to last us ’til retirement. It’s time to go.

      • Alexi

        Oh, and about your brilliant “americans/westerners only know sabatoge as a way of getting ahead”

        Again, are you on crack? Chinese, to move ahead, lie, steal, cheat, and flee. How’s that for a generalization that is just about as brilliant as yours???

        You’re an idiot.

    • John Rushnik

      I don’t think it would be a mistake for these companies to piss off the Chinese government at all. They have nothing to lose. Something is better than nothing.

      The Chinese government will never allow a foreign internet company to be successful in China. They will always put up roadblocks. Since they are not going to make money anyway, there is no harm in “pissing off” the Chinese government by doing the RIGHT thing for the Chinese people. Let’s face it, the Chinese government is an enemy of the Chinese people – Foreign companies should be on the side of the people not the government.

      Apart from that, buying into a Chinese company is only going to lose money – they cannot be trusted. There is more chance that they will just take the money and run than will actually conduct a legitimate business.

  • http://www.kailukoff.com Kai Lukoff

    Gady Epstein wrote an excellent piece at Forbes, “Will Facebook Follow Zuckerberg To China? Inevitably”, in which he argues Facebook will be unable to resist the allure of the China market and opt for a censored version: “It is easy to overestimate the impact of any outcry by Western or international critics when it comes to China; more important, one should not underestimate the rest of the world’s willingness to accept compromises in connecting with China… Virtually all companies, even Google for four years, have succumbed to the temptations of the Chinese market. It would be foolish to think Facebook won’t succumb one day, too.”

    I still disagree. But it’s definitely true that foreign internet companies still drool over the market, even if foreign firms have an abysmal track record so far. And Facebook would face especially strict government regulations. I look forward to tracking the latest developments!

  • http://500hats.typepad.com davemc500hats

    might not happen overnight, and i don’t think it will be as stark a set of options as you outline above… but i’d be surprised if Facebook didn’t at least try something in China in the next few years.

    given the enormous potential for interaction between the US & Chinese people, it would be a shame if we didn’t find common ground somewhere, whether on Facebook, Twitter, or another Chinese internet service.

    we shall see.

  • Danbloom

    re: The myth of Facebook’s 500-million-strong arrny

    To tell the truth: Most FB accounts have just 120 ‘friends’,

    Just as Amazon likes to inflate it’s bestseller rankings in order to hype
    its online presence and global glamour, So too does Facebook inflate
    its so-called “membership” stats. When TIME magazine honored CEO Mark
    Zuckerberg with its “[Geek] Person of the Year” cover story — an
    annual sales and marketing
    gimmick on TIME’s own part — Richard Stengel, the magazine’s hype guru, told
    readers that Zuckerberg was chosen “for connecting more than half a
    billion people
    and mappingt the social relations among them.”

    Excuse me, Richard, but most Facebook accounts have at most around 120
    “friends”, and
    that’s a far cry from half a billion. Where does this 500 million
    figure come from? I have a FB
    account, and I have around 120 friends, and I am not a ”member” of
    Facebook but merely
    someone who signed up for a free account. I do not belong to Facebook
    as a membership
    organization any more than I belong to Google for having signed up for
    its free gmail email service

    And furthermore, Richard Stengel, Facebook is not a
    500-mllion-member-strong social networking site. Most FB account
    holders interact with at most 10-15 other FB account holders on any
    given day. Where does this half a billion stat come from? It’s hype,
    it’s marketing, it’s bullocks.

    Let’s get real. Facebook is a phenomenon, it rocks. But it is not a
    club of 500,000 people who all
    interact and network with each other. It’s just another platform on an
    internet comprised of thousands of platforms, and while FB has won the
    lottery for now, it might not even be around in 10 years.

    Read more: http://www.techeye.net/internet/china-is-afraid-of-facebook-but-facebooks-not-afraid-of-china#ixzz19PNbIFbD

    • Zictor

      Completely missing the point. Or maybe I am, so please correct me if I am wrong. You seem to believe that all the 500K people on Facebook would need to be connected to every other user. If that is the case, I recommend you read Linked, by Albert Lazlò Barabbasi. It’s a book on the science of networks.

      One person only needs to be connected to one other person in the network to be a part of it.

  • Danbloom

    China is afraid of Facebook, but Facebook’s not afraid of China…..
    Zuckerberg’s Beijing trip Shanghai’d…..When banned-in-China Facebook CEO Mark Zuckerberg visited last month, accompanied by long time girlfriend Priscilla Chan, a Chinese-American woman from Boston who went to Harvard wtih him back in the good old days, there were two signs that caught his attention as he toured Beijing.

    One banner read, in English, “Warm welcome to China to the founder of the website 404 Not Found”. The other banner read “Warm Welcome to Mr. Part of Your Search Results Cannot be Displayed”.

    Kidding. Actually, Zuckerberg had a good time in China and is now safely back at Facebook headquarters gently scratching his head and wondering what to make of it all. It sure is a big country, and he knows that now. It sure has a lot of people, and he knows that now, too. And damn, the Beijing winters are even colder than Boston and New York. Lessons learned by a peripatetic internet visionary on his way to world domination.

    Kidding again. Zuckerberg met with a host of China’s top technology leaders in Beijing, fuelling massive media speculation that Facebook has its eyes on entering a market where it is blocked by Chinese Communist Party censors.

    Seems China is afraid of Facebook, but Facebook’s not afraid of China.

    Will he go in? Will Beijing extend an invite? Not in 2011 and probably not until China opens up enough to be called something like a full-fledged democracy. So don’t expect any Facebook members in China this century.

    Taiwan, “the other China”, is another story. With millions of Facebook members in Taipei, fuelled by the complex Chinese writing characters that Taiwan still uses – in marked juxtaposition to the simplified characters mandated by the communist mandarins in China,

    ‘Farmville” and status updates are part of daily life in the democratic island nation just off the coast of China. But Taiwan has just 23 million people and China has 1.3 billion people, so Zuckerberg is, naturally, how shall we say, interested in that part of the Chinese-speaking world.

    Do the math: China has 420 million internet users, more than any other nation on Earth. Do more math: Chinese social-networking sites have 176 million users and the number is going up every day.

    More math: Facebook is available in 66 languages worldwide, and 77 percent of its more than 555 million active users are outside Obama’s America.

    With Facebook being terminally blocked inside China, and with communist authorities never saying exactly why, Zuckerberg wants to know what’s cookin’. So he’s lookin’. Stay glued to your status updates.

    • ERICVALELY

      why do americans mention democracy all the time when they spend so much time over throwing “democratically” elected leaders?

    • ERICVALELY

      youre a god dam moron. if China was afraid of face book, they would not have given zuckerbrg a visa.

      • John Rushnik

        Ummm… NO. If China was afraid of Zuckerberg they wouldn’t have given him a visa. If China was afraid of facebook they would block it, which they HAVE.

  • 50cents

    Hasn’t the wikileaks debacle shown us when push comes to shove, America can pressure companies to to self censor just fine?

    Does Kai dispute that Facebook cooperates with the CIA requests?
    Do you dispute that the Facebook terms of use basically surrender any right to privacy and ownership of anything you post on your Facebook? If Facebook was a Chinese company with such terms of use, there would be a national outrage in America. Who needs to spy when you are willing to offer up your personal information for free? All we need next are personal RFID tags and cellphones that

    • John Rushnik

      In China it’s even more blatant. You think the Facebook and Google ‘Co-operating’ with the CIA is bad, in China the government OWNS social media and has complete control over it. Even Skype calls and chats in China are logged for 7 years and the government does not require any kind of warrant to access that data. That’s why 18 journalists are in JAIL for sending emails in China. Yeah the CIA does some bad stuff, but in China if they don’t like you the government will sell your organs for a profit. I love it when Americans say “oh it’s bad here too” and have a cry, go and live in China for a few years, you will be running back to your supposedly evil government in no time.

  • Terence Hew

    and i quote:

    “In his insightful post, “Mark Zuckerberg and China – A Love Story,“ Bill Bishop writes:

    My (unsolicited) advice? Don’t try to set up operations in China. Instead, build and distribute free circumvention tools that allow Chinese users to scale the Great Firewall and join the global Facebook community. Chinese netizens will love you for it. The government will not love you, but let’s be realistic. The government never has and never will love you Facebook, no matter what you do.”

    unquote.

    i do think Mr. Bishop has erred on this.