This article MySpace Aims for Trickier Markets by the Wall Street Journal Online gives a good indication of the kind of issues faced when rolling out local versions of social networking sites.
Included are issues relating to internet speed, web savviness, translated advertising, and local offerings. The article is ostensibly about the Facebook versus MySpace competition, but other offerings, and their local presence are also covered.
Hat tip: Vincent Pak of the Facebook.com Software Localization Group