Brad Stone of BusinessWeek has written a long and glowing profile of Facebook COO Sheryl Sandberg in which Stone reveals that Sandberg and CEO Mark Zuckerberg disagree on the wisdom of entering China:
Facebook has explored creating a joint venture with Chinese Internet companies such as search engine Baidu (BIDU) to operate a division of the social network in China that complies with local censorship and filtering requirements. The company maintains that no decision has been made. Sandberg says the subject, like countless interpersonal relationships on Facebook, is complicated. “There are compromises on not being in China, and there are compromises on being in China. It’s not clear to me which one is bigger,” she says.
Three people familiar with these internal deliberations say that Sandberg and Zuckerberg fundamentally disagree on the issue.
As I wrote in “The Rise of China’s Cybercrats,” the Chinese government is paranoid about social networks and their potential for political subversion. Stone continues the quote above with a sentence that plays directly into the paranoia of the Chinese leadership and will likely doom whatever chances Facebook had to enter China:
Zuckerberg believes that Facebook can be an agent of change in China, as it has been in countries such as Egypt and Tunisia.
It is not clear from the article if Stone is quoting Zuckerberg or if he is reporting what he has heard from others at Facebook. My guess is that he is repeating what he has been told by one or more people inside Facebook who do not want a China deal to happen.
Why speculate that Facebook insiders opposed to a China deal might be using the press to kill such a venture?
Liz Gannes wrote a very interesting article a couple of weeks ago–What’s Really Going On With Facebook’s China Plans–that was clearly sourced from Facebook insiders who provided details of the compromises Facebook might make:
Alibaba had also been in the running, but sources said its leaders had voiced disagreement with Facebook’s vision for connecting Chinese users to one global social graph, rather than first starting with a closed system.
Alibaba advised the more conservative approach, given that the Chinese political situation is currently quite tricky and the U.S. government would likely find fault with Facebook seeming to play any role in censoring its users in China, said sources.
A source familiar with those talks said of Facebook’s inclination to go with Baidu over Alibaba, “It was an issue of Mr. Right Now instead of Mr. Right.”…
Under discussions now taking place, sources said Facebook’s proposed plan could have Facebook and Baidu share the cost of setting up servers in China, and share revenue from the local version of the site. The local partner, Baidu, would presumably manage the censoring of the site and ongoing dealings with Chinese authorities.
As described above, when users outside China opt to connect to those inside China, they would see a warning message about the Chinese government.
As we all know, users are notoriously good at clicking through pop-up warnings without reading them, although this one is sure to get more notice.
Facebook could also use a combination of what it calls input filters and display filters, where Chinese users won’t be able to post or view content that’s objectionable to the Chinese government, but the rest of Facebook can run normally, sources said.
It will be a somewhat complicated technological endeavour to ensure that non-Chinese portions of the site don’t get stored in China.
Finally, Palo Alto, Calif.-based Facebook is considering sending a small group of its employees to help manage operations, but sources close to the company said this issue is still being debated due to safety considerations related to China’s oppressive government.
Such an implementation is guaranteed to piss off both US politicians and the Chinese government, and claiming that Facebook is concerned about the safety of its employees in China is the kind of extra detail that will win them no friends here.
Why would Facebook executives use the press to kill a proposed China venture? Zuckerberg controls the company, is said to be obsessed with bringing Facebook here and so has been unwilling to listen to the wisdom of other executives, especially those who fought this battle at Google. At least some of those executives are masters of public relations and media management.
Perhaps those executives opposed to a China deal have achieved a fait accompli by making the internal dissension public and placing statements in the press that will alarm US politicians and increase the already robust paranoia the Chinese government has about Facebook?