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Facebook to open Asian office

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So Facebook looks like it’s finally going to set up an office in Asia. And about time too.

As I’ve written before, last year was the year of Facebook in Asia (Southeast Asia particularly). It managed to dislodge former leader Friendster to become the leading social network in several Southeast Asian markets, with user numbers jumping 78% across Asia between January and September.

The interesting thing is that it managed to do this with no Asian presence. It has no office in the region that I’m aware of, and has outsourced its ad sales to companies such as Pixel Media and iHub.

That looks set to change. Facebook has commissioned a research company to look into how Facebook is perceived in Asia’s media-buying community and to advise on its best market-entry strategy. They’re speaking to the great and the good of Asia’s media community. I know this because they’ve approached me to give them some input too (though I’m not really great or good). One of their competitors I spoke to has heard that Facebook is currently debating between Hong Kong and Singapore for their regional hub.

The questions they’re asking make it clear that their priority is boosting their Asian ad sales. (Interestingly, the questions cover the basics of the media landscape in SEA, suggesting that the Facebook team still know relatively little about the markets they’ve conquered.)

Unless you’re employed by Friendster, it’s good news that Facebook is doing this. There’s been so much buzz about it in Southeast Asia over the past year, and the site needs to have its own people on the ground evangelising on its behalf. Another powerful voice for online can only help the industry as a whole.

It seems to me that there are two big challenges ahead though:
1) Facebook often seems to be handled as a PR tool. The way social media has been sold has been ‘get involved with the conversation’. That means branded pages, comments etc – which advertisers can do without paying Facebook any money. It needs to show marketers it can work as a Yahoo-style display platform too. Hopefully that means we’ll see some user numbers.
2) The low level of online spend in Southeast Asia and HK. With online spend still hovering around 5% of total budgets in the markets Facebook will be focusing on, the site shouldn’t expect to make big money in a hurry. Just like the rest of the industry, it needs to educate clients first of all. It wouldn’t surprise me to see Facebook joining IAB Singapore.

All in all, this is something to follow. Watch this space.

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Written by davidtiltman

February 22, 2010 at 1:37 pm

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