This Day On The Street
Continue to site right-arrow
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Why Facebook Can't Go to China Alone

Stocks in this article: FB RENN WB TWTR

Updated from 10:45 a.m. with comment from Facebook.

NEW YORK (TheStreet) -- Facebook (FB) is already the world's largest social media company, with over 1.2 billion monthly active users (MAUs), and growing. However, if the company is going to enter China and do so to get even bigger, it's probably not going to go it alone.

Bloomberg reported Facebook is set to open a sales office in China this year, as it seeks to work with local advertisers, according to sources with knowledge of the matter.

"Chinese exporters and developers are finding Facebook is an excellent way for them to reach customers outside China," Facebook said in an emailed statement. "Today, our sales team in Hong Kong is supporting these Chinese businesses, but because of the rapid growth these businesses are achieving by using Facebook, we are of course exploring ways that we can provide even more support locally and may consider having a sales office in China in the future."

Currently, Facebook is banned in China and though COO Sheryl Sandberg has made inroads in the country, meeting with various Chinese officials, including Cai Mingzhao, the head of China's State Council Information Office.

Should the Mark Zuckerberg-led Facebook enter China officially, it will likely have to do so like almost every other American company, be it in the technology field or not: via a joint venture. Companies like General Motors (GM), Ford (F) and others have joint ventures with Chinese-based companies, so it stands to reason that Facebook, the largest social network in the world, would likely have to partner with its Chinese counterpart in order to gain access to the country, and its 1.3 billion citizens.

WATCH: More tech videos on TheStreet TV | More videos from Debra Borchardt

Perhaps Facebook gains entry into China by sharing patents, intellectual property or other methods with Renren or another Chinese social network.

Given the fact that Twitter (TWTR) and Facebook are currently not in China, due to the country's apprehension about social media in general, there are a slew of companies Facebook could partner with. Sina's (SINA) Weibo (WB), essentially the Chinese version of Twitter, could be a potential partner, with its more than 129 million MAUs.

Weibo went public in the U.S. last month, pricing its IPO at $17 a share, selling 16.8 million American depository shares, at the low end of the expected price range.

Among others, WeChat, owned by Tencent, could be another partner, given Facebook's recent announced acquisition of WeChat-competitor, WhatsApp.

1 of 2

Select the service that is right for you!

Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!


DOW 18,089.64 +59.43 0.33%
S&P 500 2,090.61 +8.73 0.42%
NASDAQ 4,798.7210 +25.2490 0.53%

Brokerage Partners

Rates from

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs