Why Mark Zuckerberg Came to China and Why Facebook Will Not

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.