Brought to you by: The Trade Desk
There are at least 140 million professionals in China – "one in five of the world's knowledge workers," as LinkedIn puts it. And that's 140 million reasons why the social networking site has gotten over its misgivings about cooperating with Chinese censors.
LinkedIn launched a test site in simplified Chinese on Tuesday, pushing further into a market where foreign tech giants have generally struggled, and where authorities block Facebook, Twitter and YouTube.
LinkedIn is already popular among Chinese professionals who work at multinationals or have experience abroad: About 4 million people in China use the English-language desktop site and a Chinese-language app. The new Chinese-language beta site is part of a concerted effort to reach deeper into the mainland, though the company had to overcome reservations about doing so.
CEO Jeff Weiner wrote a long blog post justifying why LinkedIn would allow content to be censored in China and saying it would be transparent about its dealings there.
"As a condition for operating in the country, the government of China imposes censorship requirements on internet platforms," Jeff Weiner acknowledged. "LinkedIn strongly supports freedom of expression and fundamentally disagrees with government censorship."
But the positives of a strong China presence outweigh the negatives, he wrote, since "LinkedIn's absence in China would deny Chinese professionals a means to connect with others on our global platform."
Mr. Weiner appeared to be extra careful in trying to head off potential criticism about the move: Censorship concerns seem relatively off-topic for LinkedIn, a social network that "never set itself up as a defender of freedom" in the way some internet giants have, said Jeremy Goldkorn, director of Danwei, a firm that researches the Chinese internet and media and that is owned by the Financial Times.
"LinkedIn's purpose is self-promotion and networking," Mr. Goldkorn said. Freedom of expression "is not what their business is about."
A site where people upload their credentials and read inspirational stories from business leaders isn't likely to foment social unrest in China. (LinkedIn was shut down for one day in China in 2011, perhaps as a precaution, at a time when online calls were circulating for local pro-democracy protests. It hasn't been disrupted since then.)
For LinkedIn, its China business potential may actually be the more pressing issue. LinkedIn gets about a quarter of revenues from ads – to be successful in China, it will need strong Chinese-language content to attract them.
There are also many local LinkedIn copycats, and none have had major impact. Some observers question how a foreign company could succeed where local ones didn't.
"In general I think business-focused social networking is tough here, as it's against the culture to openly share one's business network," said Alvin Wang Graylin, a Shanghai-based tech entrepreneur who founded Guanxi.me, a location-based app that connects users with people based on their profile and needs.
LinkedIn "has gotten some decent traction with expats and returnees, but penetrating the local business community will be very challenging ... History is definitely not on their side," he said.
In LinkedIn's favor, it has strong partners here -- it's in a joint venture with Sequoia China and CBC. It has an experienced China president, Derek Shen, who founded a Groupon-like service here, Nuomi.com.
And LinkedIn has a new Chinese brand name – Ling Ying, its two characters evoking leadership and heroism. As an added bonus, the Chinese name sounds similar to LinkedIn, too.