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A clever intern shows us that Facebook has conquered much of the globe.

But in India, a homegrown start-up is eating the social networking giant's lunch. SMS GupShup (meaning "chit chat" in Hindi) has more than 35 million users to Facebook's 12 million. It promotes social networking through text messages—which makes sense in a land where you can pay your rickshaw driver via cell phone, but often can't find an Internet-enabled computer.

GupShup is a 200-person company with offices in Mumbai and Cupertino, California. Its SMS-based services account for more than 1.5 billion texts a month, or roughly 5 to 10 percent of India's SMS traffic.

Here's how it works: Instead of a Facebook newsfeed, India's cell-phone-using masses subscribe to text feeds, where they discuss everything from stock tips to religious festivities. It even functions as a newsletter for the Hmar tribe in Northeast India, which sends out alerts about marriages, deaths and other tribal happenings.

"One way to think about text messaging is it is the Internet in the developing world," CEO Beerud Sheth recently told All Things Digital. "In this part of the world, that is a big part of how people communicate."

The social networking boom that began in the United States is clearly sweeping the globe. But it's been a hard slog for Facebook and Twitter in many other countries, where Silicon Valley models don't always catch on. Brazilians, for example, favor Orkut, the Google-owned site developed by a Turkish software engineer. The Japanese prefer Mixi, which has a squeaky-clean image as an online hangout. And Maktoob, acquired last year by Yahoo, is king in most Arabic countries.

GupShup's model, though tailored to India's mass market of mobile users, has some challenges. To keep its services free, it pays for each text a user sends and has had to limit usage to recoup costs. The length of texts is limited, too, to make way for paid ads that run at the bottom of users' messages. At that rate, the company is not yet profitable, but Sheth hopes to turn the corner sometime next year.

Last updated: Dec 15, 2010




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