Facebook Business Aiding China Exporters Grows Amid Ban

Facebook Inc. (FB), the operator of the world’s largest social-networking site, said its business aiding China’s exporters to reach global markets is seeing fast growth even as its main Web services remain blocked in the nation.

Facebook also has “thousands” of application developers in China, Vice President Vaughan Smith told the Global Mobile Internet Conference in Beijing today. Smith didn’t comment on the outlook for offering Facebook’s social network in China, where since 2009 it has only been accessible through so-called proxy services that sidestep government censors.

China controls the Internet by blocking sites with pornography, gambling and content critical of the ruling Communist Party. Facebook said in the prospectus for its 2012 listing that “substantial legal and regulatory complexities” prevented its entry into China, home to the world’s largest number of Web users. That has led the company to instead focus on supplying marketing services to exporters.

“We have a rapidly growing business in China helping people that are exporting, exporters from China reaching customers around the world,” Smith said. “We’ve got 1.3 billion people on Facebook and it turns out that marketing to those people from China works really well.”

‘Important Role’

Chief Operating Officer Sheryl Sandberg in September met with the government agency that oversees controls on the Internet in China. Sandberg and Cai Mingzhao, head of China’s State Council Information Office, discussed issues including the “important role” the Menlo Park, California-based company plays in helping Chinese companies expand overseas, according to a statement posted to the agency’s website at the time.

Along with Facebook, most other U.S. social network services, including Google Inc.’s YouTube and that of Twitter Inc., are also blocked in China. That leaves LinkedIn Corp. (LNKD), which set up its local professional networking site in Mandarin language in February, as the biggest U.S. social media company active in China.

Without entering China, LinkedIn couldn’t accomplish its corporate vision, Derek Shen, the China president at the Mountain View, California-based company, said today.

“We have to accomplish our global mission to connect all professionals across the world,” Shen said. “China has a lot of excellent professionals but they don’t have a good global platform.”

China has room for more social networks and there is nothing to stop companies from the U.S. or elsewhere from entering, Weibo Corp. Chief Executive Officer Wang Gaofei told the conference yesterday. Weibo, China’s most popular Twitter-like microblog service, was spun off by Sina Corp. last month in an initial public offering.

“The market is open -- no matter whether it’s Sina, Tencent, LinkedIn, Twitter, or Facebook-- they can all do it,” Wang said. “With the increasing number of mobile Internet users, users’ demands will become more specific, which will lead to a more diversified social networking market.”

Tencent Holdings Ltd. operates the WeChat messaging service.

To contact Bloomberg News staff for this story: Edmond Lococo in Beijing at elococo@bloomberg.net

To contact the editors responsible for this story: Michael Tighe at mtighe4@bloomberg.net Suresh Seshadri, Robert Fenner

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