Friendster Moves to Asia

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Courtesy Prodigee Media Sdn Bhd

Malaysian pop star Karen Kong is one of the most popular people on Friendster, with over 150,000 friends

If they recall it at all, most Americans probably remember Friendster as the also-ran of social networking sites. Although the site had a head start when it launched in 2002, its founders squandered their lead when software glitches and slow access times prompted users to flee to the now hugely popular MySpace and Facebook. Friendster seemed destined for the scrap heap, remembered mainly as the company with the smiley-face logo whose owners in 2003 turned down a $30 million buyout offer from Google.

But Friendster never died — it just moved. Thanks largely to an accident of geography, it's become Southeast Asia's top social networking site. Asia is home to three-quarters of Friendster's 58 million users, compared to 17% in the U.S., and it's the source of 89% of the site's traffic, compared to just 8% from North America. While its bigger rivals MySpace and Facebook are just discovering the land across the Pacific, Friendster is already the most-visited web site in the Philippines and Indonesia, and the second most-visited site in Malaysia and Singapore, according to rankings from web tracker Alexa. In 2006, Friendster hired a 20-person engineering team in the Philippines, and last September, it opened a sales office in Singapore. Friendster's second life came almost by accident. The company started in Mountain View, California, before moving its headquarters two years ago to San Francisco, "the most Asian of U.S. cities," says Friendster president Kent Lindstrom. As a result, thousands of early adopters were Asian-American Californians who formed a nucleus that quickly expanded across the Pacific as users invited friends and relatives in Asia to join the network. Until last fall, Friendster was available only in English, but that didn't impede its growth in Southeast Asia, where colonial history has left high English proficiency and romanized Asian languages. Still, the site's new home across the Pacific came as a surprise to management. "We never envisioned it'd be growing like this," says Lindstrom.

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Friendster's international reach has become a competitive advantage, for the company as well as for users. Five months after releasing her first album, Malaysian pop singer Karen Kong uploaded a video of a recent concert performance onto her Friendster page last summer, attracting two million viewers, mostly from Malaysia, Singapore, Brunei, the Philippines and Indonesia. Her manager, Fred Chong, says that even though the record label created an expensive web site for the artist, Kong's Friendster profile is "way more powerful than any official page," attracting up to 800,000 page views per month. With more than 150,000 friends linked to her page, Kong has the biggest following of any Friendster user. "Her profile just exploded," says Chong. "For us, it's been a miracle."

Friendster's trying to pull off another miracle. It's reaching out to the 210 million Internet users in China, where the company's user base is already "in the hundreds of thousands," Lindstrom says. Last September, the company began rolling out foreign language capabilities: traditional Chinese for Hong Kong, Taiwan and other Chinese communities around the world, followed by simplified Chinese for mainland China, Spanish, Japanese and Korean. Unlike MySpace, which has launched separate, localized sites for different countries, Friendster is keeping all of its worldwide users on one multilingual site, according to Lindstrom, whose own Friendster profile shows pictures of him in Tiananmen Square and on the Great Wall.

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Friendster may have a tough time staying ahead of its wealthier American rivals, which are starting to look to Asia for growth, as well as formidable local competitors such as Shanghai-based, which already has 90 million subscribers, and Xiaonei, a Chinese replica of Facebook. Less than 10% of visitors to MySpace and Facebook live in Asia, according to June 2007 figures from Internet research company comScore, but that is set to change. MySpace now operates separate sites in Japan and China, and has plans to launch sites in several more countries this year, including South Korea and India. Though Facebook has yet to release foreign-language versions of its site, comScore data shows the number of Asian visitors to its main site spiked more than 3,000% between August 2006 and August 2007.

The privately-owned Friendster, which is operating on $25 million in venture capital, says it's not intimidated by these billion-dollar giants. "We're not surprised that people are competing in our space," says David Jones, vice president of marketing at Friendster. "That's validation of the industry we helped create." And the Americans who've written them off? "Most of the world is outside the U.S.," says Lindstrom. "We're very globally focused." Stiffer competition in Asia is surely on the way, but until then, Friendster has plenty of reasons to smile.

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