Internet & Tech

The long-distance runner

Zuckerberg looks for a new path into the China market

Facebook founder and CEO Mark Zuckerberg meets Founder and Executive Chairman of Alibaba Group Jack Ma, at the China Development Forum in Beijing

Jogs in all conditions

The Temple of Heaven lies south of Beijing’s Forbidden City. When emperors still ruled China, it was a ritual for them and their court to make a pilgrimage twice a year to the Temple, in order to make offerings to Heaven and plead for the emperor’s reign to be secured.

Last month, while attending the China Development Forum in Beijing, Facebook founder Mark Zuckerberg made a similar journey. On the day of his arrival, Zuckerberg posted a picture to his Facebook account that showed him jogging through Tiananmen Square, going “past the Forbidden City and over to the Temple of Heaven”. Some thought this yet another tactic to secure Beijing’s blessing to let his firm operate in China. But the image of him jogging through the smog mostly earned him ridicule online.

One netizen commented that Zuckerberg must be “the most expensive human vacuum cleaner in the world” thanks to the murky haze he inhaled from the capital’s streets, whilst Greenpeace reposted the picture on Twitter, instructing “Smog kills thousands everyday. Wear a mask!”

But the most interesting observation was that Zuckerberg’s “smog jog” looked to be a strangely visual metaphor for his hopes of getting Facebook into China: striving onward despite the oppressive environment.

The odds are stacked against Facebook’s entry. First of all, there is little room in the Chinese market for a new social networking platform. The forerunner in that field is Tencent and its mobile messaging service WeChat, which not only dominates the domestic market but also provides a far broader range of services than Facebook is currently capable of – such as payments and banking functions. WeChat is already an integral part of the Chinese internet ecosystem, and it is unlikely to be dislodged by Facebook.

Nor is the policy context particularly positive. When Liu Yunshan, a member of the Politburo’s Standing Committee, met Zuckerberg during his trip he told him he hoped Facebook would simply “work with Chinese internet enterprises to enhance exchanges and share experience so as to make [the] outcome of the internet development better benefit the people of all countries.” So aside from a lungful of smog, the billionaire suffered a dose of hot air.

But it was during his meeting with Jack Ma at the China Development Forum that Zuckerberg reminded us that his interests extend beyond social media, as the two primarily discussed artificial intelligence and virtual reality (VR).

Facebook owns Oculus – a virtual reality developer – that is due to release its first headset, the Oculus Rift later this year. Zuckerberg told the conference he believed VR would be a “focus of innovation in the next five to 10 years and would drive consumption”, reports the South China Morning Post. Certainly, with China’s new emphasis on developing a consumer-driven economy, and its penchant for computer games, getting Oculus Rift into the Chinese market would be a boon for Facebook.

Even in this area Facebook is likely to face domestic competition. Sitting next to Zuckerberg, Jack Ma said that he would happily sell Oculus through his e-commerce platforms. But only days before Zuckerberg’s arrival in China, Alibaba announced it had begun its own research into VR technology. Bloomberg commented: “The Chinese e-commerce emporium is exploring how virtual reality technology can be applied to its other services, including online games and video streaming.”

Although Alibaba’s foray into VR will not necessarily exclude the possibility of Facebook becoming a leader in the emerging market, it is a telltale sign of the obstacles Oculus Rift will face. As VR technology progresses, Facebook’s latest pet project will need to stay one step ahead of a Chinese tech industry which is good at (initially) producing cheap – but effective – replicas and then developing them into more ambitious devices (see our recent Focus issue on the Pearl River Delta for a deeper analysis of this trend). Evidently for Facebook, getting ahead in China could prove a hard slog.

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