Europe vs Facebook: In Love With The Local

Facebook's grip on Europe is by far not complete. According to the recent analysis from Casual Games Association presented by i-Jet Media (the biggest game publisher in Russia and Eastern Europe), Europeans still prefer local social networks to Facebook. In Poland Nasza Klasa has 8 million users more than Facebook, in Germany VZ has 6 million more and Russia's Vkontakte and Odnoklassniki together have a mighty 104 million users compared with 1,6 million Russians who've joined Facebook. Thus, Europe's 30 social networks altogether boast 180+ million users, which is 24 million more than Facebook  has in Europe.

From developers' point of view, the greatest differences between local European social networks and Facebook are the language requirements and barriers to entry. In other words, building and launching an application for Facebook is easier due to open API, transparent and unified financial conditions, virtual lack of sensorship by admin and few requirements for tech support. Building for a social network in Russia, Germany or Poland is trickier because APIs are not always open, financial agreements might need to be negotiated on an individual basis, applications are more thoroughly checked (sometimes with compulsory beta-testing) and tech support is demanded in a local language.

Those barriers to entry seem to be targeted at companies and developers outside of the country in question. This explains why there is a different social network in almost every European state. This also explains the uninhibited spread of copycat social games across Europe like 'Happy Farm'. Interestingly enough, European social game developers seem to be cooperating with each other but not with the outsiders from other parts of the world: i-Jet Media's two most popular games ('Happy Farm' and 'Wild West Trains') were published outside of Russia on German, Belgian and Polish social networks.

Thus, social networks in Europe are hyper localized yet their social games are subject to penetration, especially from big publishing companies in the region. Yet again Europe is proving to be in love with the local and unwilling to look outside of their own national borders. Might that be the reason for stifled innovation?

Image from presentation http://slidesha.re/du5uGG

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Guilherme Lopes November 12, 2010

The same thing happens in Brazil.

It's a 200 million people country where Facebook has no chance against the google's social network, Orkut.

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Clara November 12, 2010

It is an interesting post. These fragmented markets, controlled by various national players, pose an interesting challenge for Facebook. Either Facebook makes investments to consolidate or - who will, if anyone? Are they interested? Do they seek to take leadership in each market where they operate?

If Facebook was very serious about it's European expansion, could it be considering this? These are by now large local leaders with high valuations.

On the other hand, I cannot see how Facebook is going to compete in places like Poland and Russia, where they are so far behind already and where the favoring of local solutions (esp. in Russia) play a strong part.

I would be keen to hear if anyone has any comments on either of the subjects. It also reminds me a bit of the Linkedin / XING dychotomy, as they seem to cover a similar need in different geographies. It would be interesting to know if anyone has more information on those too.

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Ville Miettinen November 12, 2010

Nice article, Anna. However, I do have to complain a bit about your sentence "This also explains the uninhibited spread of copycat social games across Europe like 'Happy Farm'".

Let's not forget that FarmVille - while insanely popular - is the latecomer in this segment. The Facebook farming game genre was pioneered by myFarm and Happy Farm (which in turn borrowed ideas from games such as Harvest Moon and Lil’ Green Patch). Check out http://www.chinasocialgames.com/?p=400

cheers,
-wili

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Anna Bessonova November 15, 2010

Ville,

Thank you for the clarification and for the link - really insightful article.

In this article I was referring to the 'Happy Farm' built by the Russian gaming console, not what turns out to be the original 'Happy Farm' mentioned in the link you posted. Sorry for the confusion!

Anna.