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Facebook says censorship, restrictions pose revenue risks

Facebook says censorship, restrictions pose revenue risks

By Press Trust of India | Updated: 5 June 2012 01:09 IST

Highlights

Social networking giant Facebook has said it faces risks of content censorship and other kinds of restrictions by the governments of one or more countries and this could hurt its revenue growth.

Social networking giant Facebook has said it faces risks of content censorship and other kinds of restrictions by the governments of one or more countries and this could hurt its revenue growth.

Without naming India or any other countries where it sees the possibility of censorship or other restrictions, the IPO-bound company said it would also continue to pursue an entry into China, where it has been denied an access so far.

The Indian government in December 2011 had asked social media networks like Facebook and even the companies like internet major Google to act against uploading of offensive material on to the web platforms. Since then, there has been a debate in India over the distinction between freedom of expression and derogatory content with respect to the content on internet platforms.

Similar concerns have been raised in some other countries too. Without naming any nation, Facebook has said in its IPO (initial public offer) documents that it is possible that governments of one or more other countries may seek to censor content available on its website, restrict access, or impose other restrictions that may affect the accessibility of Facebook for an extended period of time or indefinitely.

"In the event that access to Facebook is restricted... our ability to retain or increase our user base and user engagement may be adversely affected, we may not be able to maintain or grow our revenue as anticipated, and our financial results could be adversely affected," Facebook said.

The company plans to list itself on the New York Stock Exchange (NYSE) after raising about USD five billion and has filed the documents for the same with the US market regulator Securities and Exchange Commission (SEC).

Facebook, which has over 800 million user globally, said "there are more than two billion global internet users, according to an industry source, and we aim to connect all of them."

The company further said that it would continue to "evaluate entering China" and many other countries. "However, this (China) market has substantial legal and regulatory complexities that have prevented our entry into China to date. If we fail to deploy or manage our operations in international markets successfully, our business may suffer," Facebook said.

"China is a large potential market for Facebook, but users are generally restricted from accessing Facebook from China. We do not know if we will be able to find an approach to managing content and information that will be acceptable to us and to the Chinese government," it added.

Access to Facebook and Twitter was blocked in China in July 2009 after riots broke out between police and protesters in the Xinjiang province. The access to Facebook is currently restricted in Iran, North Korea, and Syria as well.

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