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Predicting Facebook’s Entry Into China: Attempt Likely to Be Made

Though news about Facebook’s IPO has been beaten to death, it’s worth briefly noting the importance of this event with respect to Asia and China in particular.

There are a number of reasons for Facebook to now set its sights on this area of the world — note the relative absence of China’s Mainland on the network map pictured above. It’s now impossible to ignore the lure of China, especially with the hopeful eyes of investors and shareholders hovering over Mark Zuckerberg’s shoulders . They will definitely be keen on seeing how the company intends to grow, and many in China will be keeping an eye on their progress as well. Coverage has been pretty consistent in China — and on a side note, according to a quick search on Sina Weibo, news of his marriage to Priscilla Chan has been rather hot as well.

It is true of course that Mr. Zuckerberg is making some comments that may not fit so well into China’s particular brand of social networking.  His S-1 statement, filed on Friday for the official trade kickoff, mentions that Facebook has a “social mission – to make the world more open and connected.” Additionally, it states that the company hopes “to change how people relate to their governments and social institutions.” For China, those are fighting words.

Still, the numbers are going to become important for Facebook very soon, and China is all about numbers. Mr. Zuckerberg alluded to the monetary nature of the business himself by stating that “Most great people care primarily about building and being a part of great things, but they also want to make money.” Though this is a pretty standard point to make, the implications may be much greater than some are anticipating.

Facebook currently boasts approximately 845 million active users, according to the aforementioned S-1 statement.  Of these users, 483 million are daily users. While China is late in the game in its adoption of social networking, there is reason to believe that, with inevitable hiccups aside, the growth of this market is about to skyrocket. As reported last week by TechinAsia, Sina Weibo registered users have already reached the 300 million mark, and most of them are mobile users. This comes only in a matter of 3 years since Sina’s official launch, which is a service still confined primarily to China, Taiwan, Hong Kong and Macau. Maybe this is already really obvious, but its worth making the point again that mobile is also the hottest way for users to access their accounts for Facebook.

The potential here is enormous and impossible to ignore at this point, especially with the amount of cheap smartphones now inundating the Chinese market and rumors that Facebook is developing its own phone. It is only a matter of time before we see Zuckerberg showing up in China again, at least to take another shot. As many said at our conference in Beijing two weeks ago, good partnerships in China are the key to success.

Of course you can never be too sure, but at the earliest I expect something to happen in the next few months.

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