Friendster’s new CEO, Richard Kimber, thinks marketers have yet to grasp the potential of social networking. Kimber very recently stepped into the CEO’s suite at the popular social networker after several years running internet search heavyweight Google’s operations in the Asia region.
But it’s his time working in the financial services industry—including turns at the then Australian Stock Exchange and HSBC—that he hopes will help take Friendster to the top.
His opening, he believes, are signs from major companies such as Woolworths that they’re keen to integrate social networking and other Web 2.0 developments into future versions of their websites.
“There have been a few case studies and a few notable brands that have worked with Friendster in the Asian context,” Kimber explains. “There have already been some conversations, but not as many as there will be.”
Outsourcing-style opportunities
Kimber sees the opportunity in outsourcing-style relationships, under which Friendster—one of the world’s 10 most visited websites—would provide a social networking technology platform, so businesses that see potential in the phenomenon, don’t waste time building their own.
He says it’s a model that’s already generated some results in Asia, and he also believes that Friendster’s deep Asian roots may make its experience more applicable to Australia than US-focused MySpace and Facebook.
“Looking at Asia, we’ve seen some very interesting activity undertaken by the Coca-Colas, the Pepsis, the Nokias and those sorts of brands,” he says.
“So there are brands that are already involved in the space and it’s a question of not necessarily looking at what the US is doing, but maybe looking at it through a different lens and seeing what the Australian take is.”
Kimber isn’t the only person who sees potential in the model and some big names in IT investment have backed Friendster in its pursuits.
Funding injection
His appointment as CEO was announced alongside a US$20 million ($22.6 million) injection from IDG Ventures, which the social networker hopes is the last funding round it needs. Other backers include Kleiner Perkins Caufield & Buyers, Benchmark Capital, DAG Ventures and Founders Fund.
Kimber asserts that when it comes to spotting strong internet plays, those venture funds have a good pedigree.
“Kleiner Perkins and Benchmark are the two big US names. Kleiner is a company that backed Google. Our chairman, Russ Siegelman, who is from there, has been in the internet for a long time. He had worked with Bill Gates to found MSN back in the day.”
Nevertheless, Kimber’s decision to quit Google remains an interesting one. The Australian has abandoned a promising career at one of the world’s biggest and most promising brands to run a company that is all but forgotten in the West.
The Friendster edge
But Kimber believes that Friendster—which was in social networking before most people had heard of Facebook, Bebo or MySpace—has a few things going in its favour that its American and British counterparts lack. Chief among them is that the user bases of the best-known names in social networking are concentrated in a handful of Western countries and members predominantly talk to friends in English. That gives Friendster a flexibility its rivals don’t have, he argues.
“In Asia you have a lot of nuances. It’s not one homogenous market, so you have to be able to iterate and have user-driven feedback feeding into the loop. If you only have one platform, or if you only operate in one language, then things are going to be more difficult.
“Friendster has 10 languages in operation, we have an interesting [technology] architecture that allows you to operate in many different countries, and that does give us an advantage.”
What money model?
The question of how to make money remains the biggest threat to the longevity of social networking. The very nature of social networking means users thumb their noses at the types of advertisements that have typically worked online and made Google such as a success.
But Kimber argues that the use of the internet has evolved differently in Asia, where telecommunications carriers have adopted more open data-pricing plans and web users have shown a willingness to buy all sorts of virtual goods online.
That, he says, means online advertising delivered to a personal computer isn’t the only answer to the monetisation question. “Mobile ads are something that is an additional revenue stream. Then there are data revenue streams around sharing data plans and various things with telcos.
“We have a lot of interest from telcos in the region to do things with Friendster. They see it as an exciting thing because social networking is such a sticky application and people tend to spend a lot of time doing it.
Moving money and gifts
Other opportunities could include services that allow social networkers to digitally move money and gifts across borders as Friendster members in countries from Indonesia to Korea, the Philippines, Russia and Japan interact with their online friends.
But the nuances in Asia that have given rise to internet-based markets that are yet to really develop in the West also present some challenges, including Korean government efforts to police the web.
Ironically, it’s social networking that has, in part, triggered the looming crackdown on online communications, thanks to the role it’s played in the organisation of flash mobs and riots that have troubled Korea in recent years.
“But ultimately it’s a form of self-expression and, to me, it’s a very exciting one. There have been some interesting, contentious issues, but at the end of the day it’s healthy to see people speaking up and using social networks to connect with each other.”
