Local Web

Social networking site, Facebook is the latest to branch out to China. It has now launched a version tailored for Chinese Web users. Users accessing the site are redirected to a localised version, zh-cn.facebook.com, which is in a simplified version of Chinese.

The move follows the social networking site's decision to release French, German and Spanish versions earlier this year. Facebook hopes this move will help it gain ground on some of its competitors - MySpace set up its Chinese site in April 2007 and has already presence in over 20 countries around the world.

Back of the QQ

However, the Silicon Valley-based company will have its work cut out if it is to dislodge China's most popular social networking site. QQ, which is run by Tencent is the world's largest social networking site. Integrating instant messaging and games into its offering, the site has over 300 million active accounts in comparison with Facebook's 67 million or so - although many of these are multiple accounts.

QQ is also managing to do what the western-based social networking sites are currently struggling getting to grips with - namely monetising its content. QQ recently announced its 2007 earning, showing revenues of $523 million. Last year Facebook recorded a $50 million loss.

Interesting, money from advertising made up only 13 per cent of the total revenue. The most profitable was value added services such as digital goods and games, with mobile services accounting for one fifth (21 per cent).

Facebook needs to take into account the huge cultural shift not only between western society and Chinese society, but also the difference between Chinese youths and their older counterparts.

Different cultures within China

"The new generation of Chinese feel that they are living in a time of great change - they are much more open to change and progress than previous generations. They are the first generation to have grown up with technology at their fingertips and the everyday use of this is the 'norm', which has lead to a need to be constantly connected.

"However, in China, even within this younger generation, face to face interaction is still regarded as being important," said Caroline Richardson, International Director of market research agency, Nunwood.

"What we do see is that chat sites are extremely prominent in China. When asked how important online social networks and communities were in their life, 75 per cent of the Chinese said they were important. With Facebook entering the Chinese market, it will allow them to capitalise on the current success of chat sites. If they can launch of Facebook as the 'next generation' messenger site, which should be feasible considering the recent launch of the Facebook chat facility then Facebook could prove a huge success in China."

Anonymity important

"Facebook do need to consider that chat sites are so popular in China because they allow a safe and easy form of anonymous personal expression and interaction. There is no fear of being tracked down, particularly relevant given the government restrictions on media. This is a hurdle that Facebook might need to overcome. Facebook needs to demonstrate that being part of on an online community of friends is far more rewarding than being part of an anonymous chat site community," she continued.