A Model for Facebook: China's Tencent

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Monday, I profiled Tencent, China's largest Internet company. Wednesday, Facebook announced the launch of their location-based app, and I noted that the company is looking more and more like a business, and less like a piece of technology.

In the wake of Facebook's announcement, a Chinese investment banker wrote in with this perspective about the company's new strategy:

The natural analogy [for Facebook] is Tencent. Slow follower as I have called them (though that is entirely unfair since they did do the virtual goods thing earlier and better than most).
The beauty of Goog is that the cash machine was just one machine. FB will need to stack a lot of businesses together. Again, Tencent proves that the most important thing is the user base. Monetization is easy on a sticky base, even if you have to essentially build a myriad of businesses.

It's a good point. If you look at Tencent's business, they began with an IM service, which is a kind of social network. Once they'd built the best network, they started rolling out different products like mobile services, games, virtual goods, and more involved social tools.

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Alexis C. Madrigal

Alexis Madrigal is the deputy editor of TheAtlantic.com. He's the author of Powering the Dream: The History and Promise of Green Technology. More

The New York Observer has called Madrigal "for all intents and purposes, the perfect modern reporter." He co-founded Longshot magazine, a high-speed media experiment that garnered attention from The New York Times, The Wall Street Journal, and the BBC. While at Wired.com, he built Wired Science into one of the most popular blogs in the world. The site was nominated for best magazine blog by the MPA and best science website in the 2009 Webby Awards. He also co-founded Haiti ReWired, a groundbreaking community dedicated to the discussion of technology, infrastructure, and the future of Haiti.

He's spoken at Stanford, CalTech, Berkeley, SXSW, E3, and the National Renewable Energy Laboratory, and his writing was anthologized in Best Technology Writing 2010 (Yale University Press).

Madrigal is a visiting scholar at the University of California at Berkeley's Office for the History of Science and Technology. Born in Mexico City, he grew up in the exurbs north of Portland, Oregon, and now lives in Oakland.

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