Several China-based publications are reporting that Facebook has signed a deal with Chinese internet search giant Baidu to create a special social network for China. Facebook’s is blocked by the Chinese government, so the rumors indicate that the company will create a new social network especially for Chinese market of 500 million internet users, and that this site won’t be integrated with Facebook.
There have been false rumors in the past of Facebook entering China in one way or another, but this could be a way for the company to reach and monetize an enormous audience that isn’t able to sign up for the US-based social network.
Beijing-based Marbridge Consulting quoted Hu Yanping, founder of Beijing-based market research firm Data Center of the China Internet (DCCI), as saying Facebook signed a deal with an unspecified Chinese company. Marbridge Consulting later updated saying multiple industry sources told it Baidu was that company. Bill Bishop, a respected source on Chinese technology developments, tweeted that Baidu, along with Alibaba, China Mobile, and Sohu were possibilities, and confirmed that Sina was not the signee.
Facebook CEO Mark Zuckerberg met with Baidu on his recent trip to China, and the Chinese company’s leaders reportedly visited Silicon Valley in February. Baidu has been said to up to 83.6% of Chinese search traffic, and could therefore have the ability jumpstart a new social network through promotion on its properties. Facebook worked with Russian search engine Yandex to promote itself through the inclusion of status updates and a Facebook widget, and an integration with Baidu but for the China-specific social network could follow the same structure.
We’ve detailed the complicated problem China represents to Facebook. The open-and-connected nature of Facebook does not mesh with government policies or social norms in the country. It would costly if Facebook had to develop an alternate version of its site that fit the local culture. Catering to China’s repressive government to gain access there could also harm Facebook’s reputation around the world. As of the beginning of March, Facebook had 659,000 monthly active users in China despite being blocked there, probably due to some combination of faulty censorship efforts, the use of proxy servers, government officials with special access. This incredibly low penetration leaves China as a blank void on the world map of Facebook friend connections pictured above.
Creating a separate social network in partnership with Baidu could help Facebook sidestep some of these problems. It could be designed from the ground up to offer what Chinese users want without violating government policy or needing to surmount the wall of censorship. This would relieve Facebook from having to divert its product development team. Without the Facebook name on the product, there’d also be a reduced risk of a public relations backlash.
Rumors of the Baidu deal could be false, and this could all blow over quickly. But if they are true, Facebook may have found a way to enter China, albeit under a different brand name.