https:// www.nytimes.com/2017/09/06/technology/facebook-china-shanghai-office.html
Part 1
Blocked in China, Facebook Is Said to Seek a Shanghai Office
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By PAUL MOZURSEPT. 6, 2017
SHANGHAI — Facebook is blocked in China, but it is feeling comfortable enough there to look for its own place.
The social media giant in recent months has quietly scouted for office space in Shanghai, according to two people with knowledge of its efforts there. Those offices would house employees working on Facebook’s effort to make hardware but could also help with its broader ambitions in China, said the people, who spoke on the condition of anonymity because they were not authorized to publicly discuss the plans.
Facebook’s plans are tentative, the people said, and would depend on approval from the Chinese government. But if successful, it would be a symbolic victory for the social network, which has long worked to get into China despite being blocked there for nearly a decade.
“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 spokeswoman said in response to questions about the office plans.
Facebook has been looking for momentum in China, home of the world’s largest population of online users. Earlier this year, it quietly authorized the release by a small local company of a Chinese version of its Moments photo-managing app.
Despite being obstructed in China, Facebook has many reasons to continue pursuing business there. The social network sells advertising to Chinese companies hoping to reach the rest of the world. The Chinese ad sales, supported from its office in Hong Kong, are some of the largest in Asia. Even China’s government propaganda organs use it.
Facebook’s new hardware ambitions would require a Chinese presence as well. The initiatives would require plugging into China’s electronics supply chain, which helps build some of the world’s most popular gadgets, like Apple’s iPhone. The office would first be used by employees of Facebook’s hardware effort, called Building 8, according to the people with knowledge of the plans. Anything from an internet-connected medical device to a drone requires coordination with dozens of Chinese producers and assemblers, mostly located in the southern part of the country.
Facebook has for years entertained the idea of a Chinese office. In late 2015, it obtained a license to open an office in Beijing, but the permit lasted only three months and it could not establish a space in that time. Oculus, the virtual reality company Facebook bought three years ago, already has a Shanghai office.
At the moment, Facebook uses third parties and its own employees to sell ads in China. Because of cybersecurity concerns, Facebook employees run special security software on devices when they travel in China and do not have access to secretive or critical business information.
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