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Facebook’s IPO and its plans for China and global domination

Yesterday I was interviewed by Radio Australia in a piece titled Facebook IPO filing reveals China plans.

Their website includes a podcast and transcript of the segment. Below are the parts where I spoke.

BAHFEN: The question I put to Ross is…what do these excerpts from Facebook’s IPO filing say about its intentions, with regard to China?

DAWSON: Facebook has global ambitions and the biggest potential market of all is China. So Facebook has been very keen to get into China for some time, yet it is blocked inside China. In fact Mike Zuckerberg has been learning Mandarin which seems to probably reflect his ambition to get Facebook into China. At the moment there seems to be no possible way in the short to medium term that China will open up to Facebook, but it is possible and it’s certainly something which is high on the long term strategic agenda for Facebook.

BAHFEN: The filing also mentions competition from Mandarin language social media sites like Sina or Renren. Do you think those sites pose serious competion if Facebook were to somehow miraculously find a way to operate in China?

DAWSON: Absolutely. Renren is the closest equivalent to Facebook in China. In fact Renren mimicked everything about Facebook. It started in universities then opened out to the broader community. If you look at it, it has the same look and feel as Facebook and it has – I don’t know the latest figures – but it has hundreds of millions of users. Most Chinese are in fact quite nationalistic. While Facebook would allow them to communicate with people around the world and would probably gain some traction, I think Renren and some of the other similar tools such as Sina Weibo (which is touted as a microblogging platform like Twitter) are ones where the Chinese are currently comfortable, where they’re spending their time now, and I think it would be really difficult for Facebook to gain significant traction in China given the existing competition.

BAHFEN: The IPO aside, I ask futurist Ross Dawson if he thinks Facebook is likely to continue trying to get into the Chinese market in the future.

DAWSON: Absolutely, China is a very high strategic priority for Facebook over the long term. It seeks to be global and it cannot be global unless it is in China. At the moment of course they have other priorities such as the IPO. They will have a very large cash stockpile to make acquisitions which they will no doubt do. So they’ll have a lot on their plate but there’s do doubt they’ll continue to do what they can to be able to tap the Chinese market.

BAHFEN: With Twitter’s announcement, and Facebook’s comments in its IPO filing, are social media companies rethinking compromising, in order to get into the lucrative Chinese market? Futurist Ross Dawson’s thoughts.

DAWSON: Twitter’s move reflects legal realities. They do need to respond to countries’ legislation in the countries in which they operate. In some cases they may choose to not operate in those countries if that goes against what they believe is right. But Twitter is saying we need to accommodate the legislation in the countries in which we’re working and I suppose some would see it as compromise but it’s a reality of doing business in the global world.

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About the Blog author

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Ross Dawson is globally recognized as a leading futurist, entrepreneur, keynote speaker, strategy advisor, and bestselling author. He is Founding Chairman of AHT Group, which consists of 3 companies: consulting, publishing, and ventures firm Advanced Human Technologies, future and strategy firm Future Exploration Network, and events company The Insight Exchange.

Ross is author most recently of Getting Results From Crowds, the prescient Living Networks, which anticipated the social network revolution, the Amazon.com bestseller Developing Knowledge-Based Client Relationships, and Implementing Enterprise 2.0. (click on the links for free chapter downloads). He is based in Sydney and San Francisco with his wife jewellery designer Victoria Buckley and two beautiful young daughters.

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