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Inside Facebook

Facebook’s Start-and-Stop Growth in China, Taiwan and Hong Kong – A Closer Look

Posted: 02 Mar 2011 02:20 PM PST

Odd Facebook traffic patterns have been showing up in the main Chinese-speaking parts of the world over the past few months, based on data from Inside Facebook Gold, our data and research service covering Facebook's growth, demographics, and monetization in global markets.

Taiwan (Republic of China) gained millions of users, and mainland China (People’s Republic of China) — where Facebook is blocked — gained hundreds of thousands of users over the course of January. Both countries then lost users in the past month, even as neighboring countries posted normal-looking traffic gains.

These anomalies are occurring as Facebook finds itself in geopolitical cross-currents. The company has gotten new attention for the role its product has played in helping people organize protests in the Middle East, and as Chinese communist leaders are further restricting internet access in order to preserve "stability" — and as new rumors surface about deals Facebook may be doing to get into mainland China.

We'll examine possible explanations for the traffic changes further down. First, the numbers.

The Growth of Greater China

Mainland China itself went from 119,000 monthly active Facebook users at the beginning of January to 694,000 monthly actives at the beginning of February, even though the site is blocked in the country. It had not had any significant growth since the summer of 2009, when it had plummeted from 1 million users to 100,000 users — almost certainly due to a nearly complete block. Since then, with the average month has showed somewhere around 50,000 and 100,000 MAU. The winter growth has not continued, in any case. As of March 1st, the country has fallen slightly to 659,000 MAU.

Meanwhile, Taiwan, the island nation that the mainland Chinese government claims as its own, gained 3.08 million new users over the course of January to reach 11.8 million at the beginning of last month. Before then, growth had mostly been slower, ranging from the ten-thousands to a few hundred thousand new users each month in 2010. However, a surge appears to have started in October, when it grew on Facebook by nearly 400,00, and continued in November and December, adding around half a million new users each month.

But traffic dropped over February to almost exactly 10 million monthly actives. It’s unusual to see the equivalent of a third of a country’s existing Facebook user base join in a single month, then fall off by two-thirds of that growth in the next month.

In contrast to the other two places, Hong Kong didn't show anything surprising. Facebook is not blocked in this “special administrative region” of China, but growth is about what one would expect, given that more than half of its total population is now on the site (typically, countries slow down when they reach those levels of penetration). It grew from 2.83 million to 3.70 million new users over the past twelve months, but then only 21,000 new users in January. It gained an even smaller number: only around 5,000 new users.

For developers, marketers, and anyone else interested in the Chinese-speaking market, these changes are significant. Greater China (defined as these three countries) accounts for the majority of the 16 million Chinese speakers on Facebook; out of all countries with significant Chinese-speaking Facebook user groups, South Korea, Malaysia and the United States account for most of the rest, at above one million users apiece.

So, to review: Facebook had unusual, hard-to-explain growth in January, that more than dried up in February. What’s going on?

The Possible Explanations for the Starts and Stops

Proxy Servers

Social game developers, international residents and outwardly-interested Chinese citizens have long used proxy servers to access Facebook from the mainland, essentially spoofing their internet connection locations to make it appear as though they were located in other countries. That's not a new trend, and anyway such traffic wouldn’t show up for China, it’d show up for the country where the users pretended to be.

But it's possible, given the close business and technology ties between Taiwan and the mainland, that Chinese users have somehow been finding it especially easy to access Facebook through Taiwanese servers. That wouldn't explain the growth in that country, but it could explain the strangely large February surge in Taiwan.

Missing Censorship

Another possibility is that Facebook is somehow getting through to China in a limited form, in spite of censorship. We heard last year that the site may not be blocked on some mobile devices, although sources in the country have only been able to confirm that it is blocked on mobile devices. This could also explain the new China Facebook traffic.

PengYou, a real-name social network created by Chinese internet giant Tencent, introduced Facebook Connect as a way for users to authenticate themselves when joining, back at the end of December. It’s possible that a large but short-term influx of Chinese users who somehow had Facebook accounts tried using this service in China. The authentication required the use of proxy networks, though, so its usage would also not show up as Facebook traffic in China.

Facebook Marketing Efforts

Facebook has also been building out its local presence in Hong Kong and Taiwan. It opened an office in the former location last month to support its advertising and marketing teams in both places. It also released a customized application on its main Facebook page for the Lunar New Year, a major event throughout Asia — the app allows you to upload photos commemorating your new year celebration. It’s not clear if that app in particular contributed any growth over January, but the company does seem to be putting more work into developing its localization efforts, and perhaps its efforts helped account for the traffic increase in Taiwan.

Government Approval

Or, perhaps Facebook is somehow appearing in China with the approval of the Chinese government. Facebook founder and chief executive Mark Zuckerberg said last fall that he believes having China on Facebook is an important part of the company's mission to help connect the world. Given the company’s slowing growth in some other parts of the world, getting the country on may be how it can reach its goal of having 1 billion users. One can infer from Zuckerberg’s statement that he is willing to work with the government, as many other international tech companies have chosen to do in the past. It’s not clear what cooperation might mean for Facebook — China internet companies typically have in-house teams of censors, who act based on input from the government.

Zuckerberg also took a trip to China over the holidays which, while described by the company as a personal vacation, included a number of meetings with leading Chinese entrepreneurs. His visit, and leaked reports of those meetings, brought on heavy coverage in China and around the world. Maybe the trip spurred more users to try to find ways around China's "Great Firewall" censorship software? Publicity about Facebook has helped drive its growth before. In neighboring Japan, for example, coverage of The Social Network — the unofficial and unflattering Hollywood movie about Facebook's early days — has inspired hundreds of thousands of users to sign up in recent months, sources in the country have told us.

Facebook, Sinophile

Zuckerberg’s statement last year was not the first time the company had expressed interest in China. It registered the Facebook.cn domain name in late 2007. And, Facebook had also looked at getting into China in the first part of 2008, according to sources in the country who we spoke with at the time. That could have involved some sort of special version of the site that gave the Chinese government special access to China-based users.

There have been no reports of any special version of Facebook going into testing as of today. But many of China’s 1.33 billion people do not have access to the rest of the world — it's not impossible that Facebook and the government (or a government-sanctioned company) has done some testing with a far-flung portion of the country.

This sounds a lot more possible than it may have seemed just months ago. Zuckerberg met with executives at leading internet portal Baidu during his trip, and the Chinese press (via Bill Bishop) has recently reported that Baidu representatives came to Silicon Valley to discuss some sort of partnership with Facebook. That's not the only potential China deal on the table. The chairman of China Mobile, Wang Jianzhou, said in late January that he'd also met with Zuckerberg about the possibility of working out a deal.

Implications: Facebook’s Public Image, Local Competitors, Ecosystem Growth

Facebook’s Public Image

Facebook has been getting reams of positive press in Western media over the role it appears to have played in Tunisia and Egypt, two countries that have recently and apparently successfully revolted against oppressive dictatorships. Protest organizers were, despite some hiccups, able to use Facebook features like Pages to persuade thousands of people to march against their authoritarian governments. The Chinese government followed up last month by making pointed comments about its intentions to further restrict internat access. It also squelched what appears to have been some sort of attempt at coordinated protests around the country. That trend, as this recent New York Times article explains, is going to continue.

Given the timing, Facebook’s position looks especially awkward. If it does not advance any China effort in cooperation with the government, it will not be getting into the country any time soon. If it cooperates, its recent publicity wins from the role it has played elsewhere will be more than erased.

In the event of a China entrance, we expect Facebook to make the arguments that other tech companies have previously made to explain the same decision. It goes like this: Even with censorship, the very nature of Facebook — its use of real names, its social graph, its easy ways to upload and share photos and videos, its status updates tool, etc. — will help spread new ideas and make China more “open and connected.” Entering China will therefore bolster Western democratic ideals, despite the apparent contradiction.

In fact, after Google decided to work with the Chinese government last decade, its then-head of communications Elliott Schrage argued this point in detail in front of the US House of Representatives. Google mostly pulled out of China last year, following its discovery of security breaches coming from inside the country. Meanwhile, Schrage has become the head of communications at Facebook. But even given the validity of Facebook’s arguments, and Schrage’s experience with handling the issue, we still doubt the company will be able to enter China without considerable damage to its reputation elsewhere in the world. Possible fallout could include negative press coverage about the company and its values, and more hearings in front of politicians championing free speech.

The company has no doubt delayed any moves up to this point because it is all too aware of the risks.

Local Competitors

Beyond the question of political speech, or other activity prosecuted by the Chinese government, there’s the larger issue of how Facebook’s product might do in the country. After all, the site is intended to be a general-purpose part of people’s lives — a way to share photos, post status updates, organize family events, play games, and all sorts of other things besides political discussion and organizing. Observers in China have cited a variety of other factors that may cause Facebook to fail, including the wide range of established local competitors, and Chinese users’ preferences for other types of internet activity (such as anonymous online profiles).

Recent trends suggest that Facebook, all other factors aside, has a good shot at the market. Chinese social network RenRen has made itself quite popular through not only requiring users to provide real names, but copying most other parts of Facebook down to the letter (TechRice has a good breakdown of the site). If a Facebook clone can get traction in China, then Facebook itself — backed by a world of 600 million existing users, an existing Chinese-language user base, a huge portfolio of games, and deals with Chinese companies — has a great shot. Especially if one looks at all other countries where Facebook has faced established local competitors: Germany, India, Brazil, Russia, South Korea and Japan have been growing in the past year, even though it was just a year or two ago that many pundits believed that Facebook could not enter those markets.

Ecosystem Growth and Monetization

Larger geopolitical implications aside, all these traffic changes and a China entrance are being keenly watched by companies on Facebook’s developer platform.

Chinese-speaking users in East Asia have already proven to be a valuable demographic for social game developers; there are now seven titles in Chinese with more than one million monthly active users, for example, according to AppData. Zynga has even been creating localized versions of its hits, like FarmVille, to better reach these users. The recent gains in Taiwan could spur more developers to go after the market — access to mainland China would get basically all of them excited.

More detailed stats are available via Inside Facebook Gold, our data and research service covering Facebook's growth across global markets and demographics.

Facebook Brings Back Reverse Chronological “Most Recent” View to Page Walls

Posted: 02 Mar 2011 11:32 AM PST

Facebook has returned the “Most Recent” tab to Page walls, allowing users to view a reverse chronological stream of updates by the Page and its fans. The removal of this version of the wall was the most criticized change in the February 2011 Page redesign. Users can choose to switch between the Most Recent and the relevancy filtered “Top Posts” view, but admins can’t currently set Most Recent as the default view.

The change will please some unhappy admins who argued that the relevancy filter surfaced comments that were too old, especially admins whose Pages focus on current events.

Last month’s Page redesign included significant changes to the Page wall. Instead of the option to show users the Most Recent real-time stream of updates, admins could only show the Everyone view, which surfaced recent posts by friends, posts by other users in same language or country, and posts that have received a lot of Likes and comments. This sometimes surfaced comments that were days older than the latest comments.

Only admins could see a Most Recent view, which helped them make sure they’d read every post for moderation purposes.

Facebook has now renamed the Everyone view “Top Posts”, the name Facebook tested the relevancy view under in January. When admins set “All Posts” as the default view for their wall in the Edit Page admin interface, the Top Posts tab appears first.

When users are viewing Top Posts, they’ll see a drop-down menu in the top right corner of the Page wall allowing them to switch to Most Recent. This displays the latest posts by other users and the Page at the top of the stack, with no relevancy filtering.

Users will see a Page’s wall display the same tab as it last showed. So if they switch from Top Posts to Most Recent, leave the site, then come back, they’ll still see the wall display the Most Recent tab. This persistent wall state works the same way as the Top News and Most Recent tabs for the news feed, which similarly maintain state between visits.

There’s currently no way for admins to make the Most Recent tab appear first instead of the Top Posts tab when they set All Posts as the default view for their wall. Since Most Recent is now a public view, Facebook has removed the tab from the Admin view, and now shows admins a direct link to moderate”Hidden Posts” in the navigation menu.

The change shows that Facebook is paying close attention to feedback on product changes. It clearly wants Pages using a relevancy filtered wall, as this obscures especially low quality posts that might otherwise appear prominently. These low quality posts bore visitors and dissuade brands from advertising for their Pages.

The compromise of allowing admins to display a Most Recent view but not by default will quiet critics while still furthering Facebook’s goal of surfacing compelling content that sparks conversation and doesn’t repel brands.

[Thanks to Eti Suruzon for the tip.]

Highlights This Week from the Inside Network Job Board: MXP4, MTV Networks, & More

Posted: 02 Mar 2011 11:07 AM PST

The Inside Network Job Board is dedicated to providing you with the best job opportunities in the Facebook Platform and social gaming ecosystem.

Here are this week's highlights from the Inside Network Job Board, including positions at MXP4, MTV Networks, Jagex Games, and Digital Chocolate.

Listings on the Inside Network Job Board are distributed to readers of Inside Facebook and Inside Social Games through regular posts and widgets on the sites. Your open positions are being seen by the leading developers, product managers, marketers, designers, and executives in the Facebook Platform and social gaming industry today.

Formspring, Profile Stats, Cars and Dating on the Top 20 Growing Facebook Apps by DAU

Posted: 02 Mar 2011 08:51 AM PST

Mixed in with games on our list of top 20 growing Facebook applications this week were apps for luck, photos, profile statistics, browser and mobile apps and for dating. Data in this post comes via AppData, our data tracking service covering traffic growth for apps on Facebook.

Top Gainers This Week

Name DAU Gain Gain,%
1. CityVille 21,270,241 +539,078 +3%
2. Luck Daily! 482,146 +426,714 +770%
3. Windows Live Messenger 14,208,071 +343,192 +2%
4. My Photos 248,617 +163,243 +191%
5. Formspring 1,225,395 +149,772 +14%
6. 7 Best Friends 187,698 +148,162 +375%
7. Conduit 1,153,634 +139,966 +14%
8. Mynet Çanak Okey 604,344 +137,178 +29%
9. Monopoly Millionaires 260,514 +132,165 +103%
10. Your statistics 206,947 +129,608 +168%
11. HTC Sense 4,696,082 +124,011 +3%
12. Badoo 3,048,517 +113,000 +4%
13. Zuma Blitz 1,001,643 +111,964 +13%
14. Auto Club 158,232 +102,722 +185%
15. Wild West Town 344,588 +93,639 +37%
16. Cupid 171,956 +87,898 +105%
17. Snaptu 1,150,440 +85,103 +8%
18. 麻將-台灣麻將 91,013 +79,516 +692%
19. 德州撲克(中文版) 457,270 +74,445 +19%
20. YoVille 873,573 +73,895 +9%

Zynga's CityVille topped the list, growing by 539,000 DAU this week. An app that shows you your daily luck score, Luck Daily, grew by 426,700 DAU; the app tells you your daily luck score and posts it to your Wall. Windows Live Messenger continues to grow, following these two apps with 343,200 DAU this week.

My Photos is an application that takes a photo from your collection of Facebook photos and posts it to your Wall daily; the app saw growth of 163,200 DAU and grew mostly in the United Kingdom, the Philippines and the U.S.

Formspring also saw some significant growth this week, 149,800 DAU; the app sends users emails reminding them of pending questions they must answer, once the user heads to the Connect app, they answer questions, which post to the stream and have the chance to invite Facebook friends to follow them, which requires using Connect.

Two profile statistic apps grew big in India this week. 7 Best Friends grew by 148,200 DAU and Your Statistics by 129,600; the apps gather information from your profile to tell you who most frequently interacts with your profile. Another app that grew in India, Auto Club, grew by 102,700 DAU; the app allows users to vote on the cars they like the most, which generates a news feed story.

Conduit, which we wrote about earlier this week, grew by about 140,000 DAU; the app allows users to download broswer applications such as Flickr, Travelocity and YouTube. Another app, Snaptu, allows users to download mobile apps from the company web site; the app grew by 85,100 DAU and saw mostly Indonesian growth.

Dating apps were on the list, specifically Badoo with 113,000 DAU, growing mostly in Mexico, France and Italy; we wrote a more detailed review of Badoo last year. Then there was Cupid, which grew by 87,900 DAU in the U.S., India and the UK. The app includes a pop-up asking users to Like the app's Page. Among the remaining apps on our list, most were games, two of interest were in Chinese for mahjong, 麻將-台灣麻將, and Texas Hold'em, 德州撲克(中文版).

torsdag den 3. marts 2011 at 07.24