Social Network News

And This is Why China is Every Internet Company’s Wet Dream

According to the latest government data, China now has 253 million Internet users, due to recent sharp growth - 56 percent from last year. The inevitable has happened: China now has more Internet users than the USA, which is at 223.1 million with 71% online penetration. The fact that the Chinese government is exercising very strict control and censorship over internet use has immensely slowed down the growth of Internet use in this country, but when you’ve got a population of over 1.3 billion, even a relatively small fraction of it is enough to become a global leader.

Yes, the really amazing thing is the fact that the online penetration is China is mere 19.1 percent, way, way lower than the USA and most European countries. Financial facts are even more revealing: total revenues for all of China’s internet companies was $5.9 billion in 2007 while in the U.S. online advertising revenues alone in that same year were $21.2 billion. For companies such as Google, Microsoft, Yahoo and other giants, this means two words: untapped potential.

Research firm BDA China Ltd. estimates that China’s online population will keep growing by 18 percent annually - a modest estimation, considering that this growth was 56% this year - and reach 490 million by 2012. The US online market suddenly seems small in comparison. Due to strict Chinese government regulation of the Internet, financially the Chinese market will not catch up as fast as it could, but with a little (inevitable) westernization and a little globalization it’ll get there, and every online firm will want a slice of the pie. This one growing market might be more important than most other world’s markets put together.

Twitter’s Communication Classification (video)

Last Friday, our resident cranky fart Steven Hodson posited that Twitter wasn’t, in fact, a status micro-blogging utility but in fact a communictations tool most closely resembling instant messaging. Certainly when I’m attempting to explain Twitter to newbies, that is the easiest way to explain it, but quite a few of you Mashable readers took exception to the characterization. As of the time of this writing, the debate still rages on with the comment count in the triple digit range.

From Michael editorial:

It amazes me how anyone in all seriousness can even consider the inane twaddle that permeates the Internet from services like Twitter as even coming close to blogging or micro-blogging. Has anyone really paid attention to what is being said on Twitter these days – that is if you can make it through the growing amount of spam that is occurring. Sure micro-blogging is a valid term when used to describe things like tumblr or posterous but not when used to describe Twitter.

On Writter Conversations today, Sean and I try to make sense of the debate and put together what our take is on it.  Sean came into the discussion pretty squarely on Steven’s side, but I was a bit unconvinced.

I’m one of those guys that views the act of blogging, for almost all purposes, as a form of conversation (even if it is occasionally a conversation with yourself). Thus conversation being a form of communication, it isn’t a leap to classify Twitter in the realm of conversational tool (though I’ve always tended to view it more as a lifestreaming tool).

Also on today’s program is another exciting episode from the SummerMash tour, this from the San Francisco tour stop with a conversation with the FiltrBox folks(who we had on Mashable Conversations recently ourselves).

You can check it all out by downloading the MP4, subscribing to our feed, or watching the embed below.

Breaking: Facebook Signs Search and Advertising Deal with Microsoft

CNBC is reporting that Microsoft and Facebook have signed a search and advertising deal. The partnership involves integrating Microsoft Live Search on Facebook, which will include the software giant’s search advertising. Microsoft Live Search will launch on Facebook sometime this fall, according to the report.

Currently, Microsoft serves contextual advertising on Facebook, and the company made a $240 million investment in the social network back in October. At the time, it was unclear whether or not search was part of the deal.

MySpace has a similar deal with Google, which includes a guaranteed $900 million in revenue to the News Corp-owned social network. That partnership has had lukewarm results so far for Google, who has indicated during its quarterly earnings announcements that it is struggling to effectively monetize social networking inventory.

These deals are par for the course for most big online media companies. For example, in addition to its MySpace deal, Google powers search on sites like AOL and The Washington Post, while Yahoo powers search at former Web 1.0 darling Lycos. While most people ultimately keep searching via their service of choice, the law of huge numbers means that at least a few people will do their Google, Yahoo, or Live searches via a partner site.

So far, the MySpace deal is just a simple implementation of Google search under MySpace branding. What will be interesting to see is if the social networks begin to do innovative things with social search by leveraging your friends list. Yahoo recently released Build Your Own Search Service (BOSS) to allow developers to do just that, with Me.dium signing on as an initial partner.