Facebook's Very Long Road to China

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HONG KONG, China -- As unrest, fueled in part by Facebook, spreads across the Middle East and North Africa, the largest social network has been quietly laying the foundation for a future move into China.

This month, Facebook opened a Hong Kong sales office in China's special administrative region (SAR), its second in Asia. This follows the opening of a Singapore office last summer. It already has over 3 million users in Hong Kong.

Facebook made the low key announcement during Hong Kong Social Media Week to a small group of local journalists: "We are excited about being a big part of the Asian market, in general."

When asked specifically about the company's China strategy, Blake Chandlee, Vice President and Commercial Director, Asia Pacific, Latin America, and Emerging Markets said "there are a lot of reason I do and don't want to talk about China."

The Chinese government currently blocks Facebook, along with Twitter and YouTube, making it inaccessible to over 420 million internet users. That's only a fraction of China's 1.3 billion population and statistics show explosive growth online over the next few years as more Chinese get on the net.

Experts say after Google's very public departure in 2010 and the subsequent political fallout it caused, Facebook has been staying away from both Hong Kong and Mainland China, so as not to offend Beijing.

According to Charles Mok, Chairman of Internet Society Hong Kong, "the main reason why Facebook [is here] is for business reasons and be where the advertising revenues are, but it is choosing to do it in a low-profiled way to minimize any political overtones or unnecessary speculations."

This could explain why Chandlee called co-founder and CEO Mark Zuckerberg's visit to Beijing last year a "vacation" with his girlfriend Priscilla Chan, explaining "Mark is learning Mandarin."

During that trip, Zuckerberg is widely reported to have met with the head of Baidu, China's top search engine, as well as, Sina CEO Charles Chao, Billionaire Jack Ma and China Mobile's Wang Jianzhou.

Zuckerberg appears to be well aware of the network of social media players vying for users on the mainland. These include: Sina's Weibo, a Twitter-like micro-blog; RenRen, a Facebook equivalent with 170 million users; and Youku/Tudou, video sharing sites modeled after YouTube. As his meetings show, the young American CEO clearly wants to learn from them how to navigate this difficult market.

While Zuckerberg works to climb over the Great Firewall, Facebook's Chandlee and others are focused on the rest of the region. "We are north of 500 million users and we are growing... and a lot of that is in Asia."

Figures show Asians are flocking to Facebook and it is quickly becoming the region's leading social network. After the US, Facebook's largest market is Indonesia, which has tripled its users over the past year to an estimated 29.4 million people. India and the Philippines are also showing explosive growth.

So what's next?

When asked about the future, Chandlee said simply "mobile is the future of our business, especially in Latin America and Asia.

Zuckerberg recorded this nerdy infomercial  about mobile phones for Taiwan's HTC so he could tell you himself.

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Jennifer Mattson is a Hong Kong based journalist and a former producer for CNN. Her writing and reporting have appeared in USA TODAY, The Boston Globe, The Women's Review of Books and CNN.com. She is the former Managing Editor of AsiaSociety.org

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