Facebook Unveils Photo Sharing App Launched Secretly In China

Reportedly, Facebook Inc. (NASDAQ:FB) has approved a photo-sharing app called “Colorful Balloons” – which is a clone of its Moments app – secretly released in the month of May in China. Per The New York Times, which quoted a post in Apple’s (NASDAQ:AAPL) App Store, the app was launched by an East Beijing-based company Youge Internet Technology.

Per media reports, Colorful Balloons is designed to assist users to share photos and videos with friends and families via QR codes. While the Moments app connects users through Facebook itself, Colorful Balloons connect users through China’s largest social network WeChat, which is operated by Tencent (OTC:TCEHY) .

Facebook’s anonymity is well understood, as many of its apps remained blocked in China. The primary Facebook app was blocked in 2009, while company’s photo-sharing app Instagram was blocked in 2014. Moreover, Facebook’s messaging app WhatsApp was partially blocked last month.

In Oct 2016, the Chinese government stated that Facebook and Alphabet’s (NASDAQ:GOOGL) Google can return to China only if they “respect China’s laws.” Although it provided a ray of hope for the company, nothing concrete has materialized over the last eleven months.

We believe that Facebook’s approval of “Colorful Balloons” reflects the company’s desperation to reconnect with the growing 700 million internet users of the world’s most populated country. However, linking of Facebook’s brand with the app can lead to scrutiny under China’s strict internet censorship rules, which can be devastating for the app.

Moreover, the app faces significant competition from other popular photo apps like B612, Meipai and Meitu in China, which is a headwind. In this regard, lack of Facebook’s technical support (apparently) can result in the pre-mature closure of the app in our view, particularly given the initial lukewarm response since the spread of the news.

Further, Facebook doesn’t have a good track record with standalone apps, which include Moments along with Lifestage, Poke, Slingshot, Notify, Riff, Rooms etc,. Hence, it remains to be seen whether “Colorful Balloons” proves to be another addition to its list of unsuccessful apps going ahead.

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