Facebook samples China's potential with sneaky app

Facebook's sneaky launch of a photo-sharing app in China, where its social network is banned, gives it a small taste of the massive market's potential, but it may have to settle for just that for now.

The US tech giant acknowledged last week that it was behind the Colorful Balloons application, which is similar to its Moments app but omits any mention of Facebook's brand name.

Facebook has strived to breach the "Great Firewall" -- which tightly controls China's internet content -- ever since its flagship social media platform was banned by Beijing in 2009.

Facebook chief executive and co-founder Mark Zuckerberg has made high-profile visits to China and met with political leaders. He is even studying Mandarin.

"We have long said that we are interested in China, and are spending time understanding and learning more about the country in different ways," a Facebook representative said last week after the app's origin was revealed by The New York Times.

But analysts voiced doubts that Facebook will fully enter the Chinese market any time soon, and the app has had a humble beginning since it emerged in May.

According to San Francisco firm App Annie, Colorful Balloons ranked 46th in the photo and video category for iPhone apps in China and a lowly 758th among all apps.

"Facebook threw a curve ball in getting inside the China market. It may not be effective, but it is certainly a nice try," said Zhang Yi, head of mobile-internet consultancy iiMedia Research Group.

"But it will be difficult for Facebook to enter the Chinese market as a whole because it is unlikely China will change its policies and laws any time soon."

The app has icons and features similar to Facebook's Moments application. Chinese users must register with a local mobile number and the app will sort through the images stored on their phones based on dates.

The app is not linked to Facebook accounts, so users can't post pictures to their Facebook pages or view content from Facebook through the app.

"If the app can't cross the Firewall and (can) only be used in China, what's the use of it," one person commented on China's Twitter-like Weibo social media network.

- Shanghai subsidiary talk -

Colorful Balloons was released in May by a company called Youge, according to Apple's App Store and one of the Android app stores.

A company named Youge Linking Internet Technology was registered in Beijing in March, with a capital of one million yuan ($150,000), according to the National Enterprise Credit Information Publicity System.

While the app is not mentioned in the system it says the firm's business covers internet information service and software development.

Shortly after the company was registered, Facebook's China representative Wang-Li Moser had a meeting with Shanghai's commerce commission director Shang Yuying in May to talk about setting up a Facebook subsidiary in the city, according to the commission's website.

Facebook is among the several global internet giants that are blocked in China, whose security services closely monitor the web for sensitive content within the Great Firewall.

The government has implemented new cybersecurity measures this year to further police the internet.

- Too big to pass up -

"China is not banning Facebook the company. Only its social networking platform is not allowed," said Fu Liang, an independent technology analyst based in Beijing.

"As long as this app does not go where it shouldn't and stays as an innocent photo sharing app, China's regulators won't give it a hard time," said Fu.

Zhang Yi of iiMedia said Facebook could afford to try out an app that is limited to China's huge market and not available elsewhere in the world.

"China is too big a market for Facebook to pass up," Zhang said. "And I think it is worth it to put down some chips in the game now, as long as it does not affect the operation of the parent company itself."