China Wants To Buy Facebook Stock

http://blogs.forbes.com/gordonchang/2011/07/03/china-wants-to-buy-facebook/

by taylorbuley • 15 years ago

61 39 15 years ago

blogs.forbes.com

Shenglong• 15 years ago

Is it safe to say Facebook can probably double its userbase by going into China? Morality aside, this could be immensely profitable. More, Google has already backed out of China... so wouldn't it only make sense for Facebook to seize the opportunity to expand without Google+ competition?

jayp08• 15 years ago

I dont think that will happen ...unless facebook's only interest is to make bucket loads of money. If China does end up buying stake in fb, fb risks loosing a lot of existing users.

pavel_lishin2• 15 years ago

> ...unless facebook's only interest is to make bucket loads of money

Aren't they a corporation? What other interest would they have?

And Facebook is probably going to lose quite a few users to Google+ anyway - I can't think of anyone who would eschew Google+ for Facebook, but then suddenly quit because China invested.

wisty• 15 years ago

Not really. China will get non-voting stock. I'd pay money to see a Chinese representative trying to explain to Mark "I'm the CEO, bitch" Zukerberg why their minority non-voting stock means Facebook MUST follow Chinese laws OR ELSE.

chernevik• 15 years ago

They are trying every vector of influence. Maybe they're trying to work up to a board seat. That would give them strategic and operational insights that would help them monitor and censor. And, position them to co-opt any China entry under a "partnership".

Also: Many Chinese are accustomed to considerable collusion and shady dealings among partners. Simply publicizing a stake could make many Chinese leery of FB, and less likely to use it politically.

pavel_lishin2• 15 years ago

> A billion-dollar investment does not buy much influence in a site expected to be worth a hundred times that when it goes public.

Really? Facebook is going to be worth a hundred billion dollars?

tatsuke95• 15 years ago

Give or take, that's the latest figure being tossed around. I believe the last second market buy-in was at a valuation of $87.5 billion, and that was in May (someone correct me if I'm wrong).

Adding 10s of billions of implied market cap a quarter. The bubble knows no bounds. Interesting product, interesting stock. Regardless, does anyone else think this is going to go down as the biggest tech stock blunder in history? Can anything from 2000 touch this? It's madness, and infinitely intriguing.

nextparadigms3• 15 years ago

Last one was $70 bn. It dropped from about $85 bn. Even $70 bn is way too much for Facebook. I think their valuation grew more like a Ponzi scheme. Everyone thought it was going to have a higher value, so they invested more in it and told others about it.

I remember it grew a few tens of billions basically overnight with bit tech sites claiming "..and Facebook's value grew another $5 billion this week".

I think its value will start dropping fast by the end of the year, especially now with Google+ gaining traction.

Zakuzaa• 15 years ago

Yes, most likely.

hollerith• 15 years ago

The facts in OP lower my opinion of FB even more.

mef2• 15 years ago

The article confusingly states first that China's stake would not be influential, and then states that the apparent reason for China's interest is to have "control in the long run".

Even if China's stake was influential, why would they need it in order to censor Facebook? They censor plenty of sites in which they have no stake whatsoever.

esrauch6• 15 years ago

They are currently only able to completely block the website from China. If they can get an influential stake then they can have it open in China with back doors to block certain traffic/words and give law enforcement access to information on dissidents.

mef2• 15 years ago

Sure, but what motivation would they have to open it in China instead of just blocking it and propping up a Facebook-style Chinese site that they can surveil for free?

prostoalex• 15 years ago

It's a dual-class stock structure, "an influential stake" is purely theoretical.

joe_the_user• 15 years ago

"Even if China's stake was influential, why would they need it in order to censor Facebook? They censor plenty of sites in which they have no stake whatsoever."

Uh, to censor it in other countries?

andymurd• 15 years ago

I suspect that China does not want to censor or influence Facebook, but rather to co-opt its IP, as it has done with other US corporations (sometimes legally, sometimes not) - see Cisco, Google, GM, Microsoft.

Holding a good-sized stake in FB is a great way to plant an inside man and gain access to that IP.

taylorbuley• 15 years ago

Thanks to whomever clarified title from "China Wants To Buy Facebook" to "China Wants To Buy Facebook Stock"

SystemOut• 15 years ago

Hey, if they can get a few billion dollars of China's cash at the current inflated valuation for non-voting stock who are we to criticize?

They would need to somehow purchase very large blocs of voting stock to gain enough board seats to matter and that's not going to happen anytime soon.

I think this is much ado about nothing.

mclin• 15 years ago

Is this going to help in any way to better clone facebook? http://www.renren.com

ph0rque• 15 years ago

Reminds me of this cartoon: http://i.imgur.com/9q7UL.gif

enjalot2• 15 years ago

A lot of xenophobia in this article. The amount of data Facebook, Google and others are collecting on us is worrying when we think of what might happen if it gets into the "wrong" hands. Right now thoughts of China buying Facebook illicit this image easily in our western minds, but we should recognize this feeling as an admission that we don't really feel safe giving so much control to these companies.

I haven't taken many active steps not to depend on them, but it's troubling whenever I think about what happens if a bad apple gets in the bunch. If I were to become a target of someone with access to Google or Facebook level data, there would be nowhere to run.

I don't foresee becoming a target in the near future, so I haven't done much to 'liberate' myself or switch to open solutions. For now the services provided give me many more benefits than worries. I just wanted to point out that this article is playing on xenophobic fears and we should be careful of doublespeak.

sliverstorm• 15 years ago

*elicit

esrauch6• 15 years ago

As far as I know no company has ever tracked down dissidents and imprisoned them. I'm not saying that you should exactly trust Facebook, but I think it is disingenuous to imply that you have just as much to fear from a crooked company as you do from a crooked government.

18pfsmt2• 15 years ago

I find this interesting because I was just reading about these incidents from the early 20th century in the US:

http://en.wikipedia.org/wiki/Ludlow_massacre

http://en.wikipedia.org/wiki/Battle_of_Blair_Mountain

Both of these articles are about union struggles where the government intervened on behalf of corporations. These incidents have caused me to question how we treat various types of organisations [i.e. C-corps vs. 501(c)(3)] as they relate to society.

enjalot2• 15 years ago

My point was actually that I fear any corrupt person having access to the kind of data that FB or Google have. If I am that person's target, for any reason (political dissent, competition, just cuz) I am way more screwed. It doesn't have to be a company or a government, it can be a criminal organization or just a crazy individual.

I don't think I was being disingenuous, my point is about how dangerous and powerful the data these companies have is. They probably have more ability to identify and locate an individual than any of the 3 letter agencies. My other point was that the article has a serious xenophobic agenda, something that probably increases readership but is bad for the world.

Apocryphon• 15 years ago

Looks like it's a shadow war between the CIA and the Guoanbu!

faragon• 15 years ago

Let's them buy it all, could be a win-win, as since 4-5 years ago, Chinese economy has an important bubble component, so they are theoretically "experts" handling those cases (/irony).

dedicated• 15 years ago

First the Russians buy into Facebook and now the Chinese too? All kidding aside, why would Facebook even want this to happen. It's not like they don't have enough investors out there waiting to throw money at them, who won't have potential conflicts of interest (censorship, surveillance) don't the road.

And did the author actually mention MySpace as a potential destination for defecting FB users, without mentioning Google Plus?

China Wants To Buy Facebook Stock

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