Facebook has almost conquered Southeast Asia and why

Two months back, I broke the story regarding Facebook overtaking Friendster in Malaysia and predicted that the surrounding countries in the region will also fall after. After looking at an updated world map of leading social networks in the globe (by Vincenzo Cosenza - translator of Facebook Marketing Bible in Italian), the domino effect is continuing across the whole of Southeast Asia. Facebook has now overtaken Friendster in Southeast except Thailand and Phillipines. Note that Hi5 is still the most dominant social network in Thailand, and Phillipines remains to be the last bastion for Friendster with their recent introduction of calling cards and mobile payments. How did that really happen given that Friendster received a fresh injection of funds from IDG Ventures SEA?

•  Design Interface of Facebook continues to bring new users to her platform: One of the key revolutions in online social networks in the 2.0 era, is the ability of users to be clairvoyant and view the activity of their friends. An example that I often used during my talks on online social networks from Barcamp to Unconference 2009, is that I can now know a lot about a friend who I have not been in touch for the longest time via the activity feed which was first introduced by Facebook. For example, if my friend has uploaded new baby pictures, I would know that his wife has just given birth. It is that kind of interaction that attracted Facebook users. Whereas in Friendster (see the activity feed picture I attached on the right), when I login, the first page that I am directed to is not the page which displayed the activity of my friends but my own user profile. To be fair, Friendster has recently incorporated a "Home" page. In fact, I believe that they have taken a leaf from the dashboard (or Home) page from Hi5.com with the way they display activity of other users connected to you. It is not that Friendster is losing the battle by not trying to catch up with Facebook in terms of functionalities, but rather the way how the users interact via a clean and well-designed interface in Facebook makes Friendster less appealing and starts losing users. In fact, I can easily point out two features which Friendster has imitated from Facebook but failed to gain traction within: groups and apps. Till date, BattleStations (one of the successful Singapore games on Facebook by Tyler Projects) has not done well after their app is launched on Friendster is one clear example.  
• Migration of Friendster users over to Facebook: The tipping point for Facebook happens in Sep-Oct 2006, where there is a lot of coverage from the mainstream media in Southeast Asia about the platform. In fact, when I was working with my students in National University of Singapore, most of them are organizing events using the Facebook event feature. Even when I first signed on Facebook, I did not really use the account until I started getting a lot of friend requests via Facebook from my alma mater in UK. In fact, I can now safely say that the crossover of users from Friendster to Facebook and vice versa is asymmetrical with more flow going towards Facebook rather than Friendster. The interesting question now is why Facebook has not been able to supercede Hi5 in Thailand. We should probably explore this further.
• Why social networks in East Asia are not subjected to this Domino Effect: The social networks in the East Asia bloc are making more headways against Facebook as compared to those in Southeast Asia (and they are few and far between local social networks). First of all, one should probably notice that the western social networks are dominant in Southeast Asia and India. India is former British colony and also have a huge English speaking populace, and hence a western social network like Orkut (owned by Google) dominating should not be much of a surprise.The key is that most of the countries in this region are former western colonies and the local populace tend to follow the western social networks with little need for localization. A more subtle reason, I suspect is to do with the business model. In the East Asia bloc, the main revenue model is not just online advertising per se. In fact, most media buyers are still thinking that the only thing they can do in online advertising is just banner ads. They are more conservative in adopting new and radical approaches and given the limitation of micropayments, the situation gets much worse. So, the western social networks may dominate Southeast Asia, but the monetization does not come along while the East Asian social networks are fully monetized from dollar to dollar and cents to cents. 

So, the story continues. Speaking of which, if Friendster will to fall in the future and Facebook will to set up shop in Asia, will they be still hiring the same group of executives who did not successfully revive the company against the onslaught from Facebook?

P/S: I have just received a note that the Social Networking World Forum for Asia will be held in Grand Hyatt Hotel, Singapore on 22-23 Sep 2009. I will suggest that a forum like this will be helpful in knowledge transfer from East Asia to Southeast Asia to explain why the social networks in the East Asia bloc are monetizing better than their western counterparts. Perhaps, brand marketers and media buyers should start to move beyond banner ad online advertising for a change.

Comments

[Geekonomics]

Orkut's dominance in India is unique in itself, not sure if it's related to their British colony past. But I believe India will move into mobile social networks fast.

Friends and I have always wondered why Friendster's CEO office in Australia with less than 10% of the staff when the action is really in the rest of the world. But I believe Friendster still has a sizeable user base in SEasia amongst the much younger audience who don't want to add their parents on facebook.

Facebook has to be careful how they constantly upgrade their UI and lose users along the way. It remains to be seen how successful they can generate revenues from the businesses entering facebook.

[ssumin]

there was a related article in mypaper this week that talked about how the biz models of social networking sites in Asia and how they have managed to monetize by selling virtual goods. based on an interview with benjamin joffe from the e27 unconference.

i have the clipping of the article if you want to read it - it's in chinese, which is actually quite appropriate since it's talking about east asia sites. lol...

[Hillary]

Facebook could have offered the username for a fee but instead, they gave it out for free. I guess they realize there's still some competition in their marketplace. The easier they enable their users to connect with each other, the more users they will have.