How its success is beginning to turn into a problem for Facebook in India

Between Facebook and Whatsapp, the company has not only found wide acceptance by customers, it has also been successful in staving off unfavourable policies. Until it got entangled in political battles.

Late evening on September 2, Facebook India MD Ajit Mohan stepped out of the Parliament Annexe building--a stately sandstone structure that houses the library complex--with a clutch of binders. While a mask hid part of his face, his demeanour was weary. Accompanied by colleagues and dressed in formals, he had just stepped out from three hours of tough questioning by the Parliamentary panel on IT about the functioning of Facebook in India. The panel ultimately posed more than 100 questions to the company, demanding answers in writing.

The previous evening, India’s IT minister had written to his Mohan’s boss and Facebook CEO Mark Zuckerberg, personally accusing the “India managing director” and other staff of the company, of belonging to “a particular political belief”. A development like that, as well as this hearing, would normally have been dealt with by the company’s high profile public policy head in India--Ankhi Das. In the event, her absence served as a reminder of the perfect storm Mohan and the company are faced with--allegations of bias from both the opposition as well as the ruling party, with the country’s IT minister himself levelling an accusation against the country MD.

This, at a time when the company’s ability to influence policy here is critical to its continued presence and business in its largest market by the number of users, where it was hoping to launch Whatsapp Pay, a payments play atop the ubiquitous chat app owned by Facebook. That and everything Facebook did in India to cultivate a favourable policy framework for itself, by heavily investing in a public policy team and lobbying capacity over nearly a decade, now looks dangerously shaky. And the high stakes controversy that shrouds it makes behind-the-scenes damage control virtually impossible.

The company’s problems started with media reports that FB’s content moderators are forced to go easy on ruling party members in violation of hate speech norms by the company’s policy team, and specifically by Das. Some Facebook employees wrote to the company management, demanding reform, and received an apology from Das for a communally charged post she herself made on her Facebook account. The government got into the act when IT minister Prasad wrote to Zuckerberg, saying such allegations were a result of internal tussles within Facebook and if anything FB staff is biased against the ruling party and have abused the Prime Minister.

All of this might strike Mohan, who arrived at the company 18 months ago, as a terribly unfair problem to have, considering the problems stem from a legacy that predates him.

Existential decisions

In Delhi, Facebook was seen as something of a case study in navigating complex environments, those steeped in the practice of public policy lobbying in the Capital say. So effective were Das and her team at managing the policy environment that an unsaid understanding had taken shape--Facebook would lead the efforts in areas that are of common interest to other US-based tech giants.

“She (Das) took the position of a senior policy person in the tech sector, not just for Facebook. She would get stuff gone and do things that others would not be able to pull off,” said a senior public policy official who has observed her working closely for many years.

As for Facebook itself, these efforts have paid off, contrary to the public perception that its inability to get Free Basics off the ground and the delay in securing approvals for Whatsapp Pay represent major setbacks. What is unseen is how a number of policy proposals that would have adversely impacted Facebook’s interests have remained in limbo, as if stymied by some unseen force.

“No doubt that Facebook has had some big failures (in India) but at the same time they have had some good victories. The intermediary guidelines have been stuck for two years. The elections have gone off relatively smoothly, with no blowback to Facebook in India,” said a public policy official at a rival firm.

After the Cambridge Analytica scandal broke in 2018 (behavioural marketing firm Cambridge Analytica harvested the data of millions of Facebook users without their consent), the Indian government, led by IT minister Ravi Shankar Prasad, threatened to summon Zuckerberg to India. An enquiry by the Central Bureau of Investigation was set up, apart from a governmental probe. Little has been heard about it since then.

The government also went after Whatsapp over the spread of fake news and viral videos that led to lynching deaths. Government wanted the ability to monitor the flow of messages on the platform and trace the origins of such messages, so the culprits can be brought to book. Whatsapp dug in its heels and refused to dilute end-to-end encryption or provide backdoor access.

Many letter exchanges and high profile meetings later, the government decided to amend the intermediary rules under the IT Act to mandate traceability of original message sender by platforms for law and order purposes. The draft guidelines were released in December 2018 and are still awaiting approval despite the fact that the government had committed to the Supreme Court that the guidelines will be finalised by January 2020.

The entire issue around the spread of fake news could easily have been a policy nightmare for the company. But the government has done little so far about the spread of fake news through social media platforms.

“Facebook has done something right for the government to not do anything about it so far… The inaction on the intermediary rules, encryption, traceability... these are all victories for the company,” the official quoted above said.

Issues like traceability and intermediary liability amendments are the kinds that could disrupt business continuity for such platforms. Complying with traceability would mean Whatsapp having to reengineer its tech architecture for compliance in one country. Any dilution of intermediary rules can inordinately raise the cost of compliance. The safe harbour provided by the legal framework that recognises platforms as intermediaries, and deems them unaccountable for the content posted by users, is the very foundation of legal viability for social media platforms.

Facebook also had another run-in with the Indian government in late 2019 when WhatsApp sued Israeli firm NSO over allegations that its spyware was used to snoop on Whatsapp users. GoI asked Whatsapp why it didn’t inform the Indian government, given that two dozen Indians were impacted by the hack. The government then ordered an audit of Whatsapp’s technical systems to investigate the issue. But there has been no update on it since then, and it’s not clear whether the audit took place at all.

A Facebook spokesperson said in response to a question from ET that the public policy team is only one of the many internal stakeholders who have a say in content enforcement decisions. “For all content enforcement decisions including on hate speech, we are governed by our Community Standards, which we enforce globally… In a very small number of cases, content decisions are escalated to leadership. When that happens, a number of teams weigh in with input, including the Public Policy team. The decisions around content enforcement are not made unilaterally by just one person; rather, they are always inclusive of views from different teams and disciplines within the company.”

Facebook equals Internet

Mohan’s problems, ironically, stem from Facebook’s success in India--both in terms of the reach of the company’s platforms as well as its success in shaping a favourable policy environment.

In India, Facebook has 330 million users, the largest for any country in the world. Whatsapp is even more ubiquitous, with 400 million users and that ultimate reward in product success--usage as a verb. Indians don’t message each other, they Whatsapp. India has close to 450 million smartphone users and about 600 million internet users. For many in the country, such is the ubiquitous nature of Facebook’s presence, that some of these apps are, in fact, the internet.

This means these platforms and their content policies are incredibly important for political parties who have harnessed the power of social media to engage in perpetual campaigning. These parties, when in government, get to determine the terms of engagement for these firms. This creates circumstances that might present Faustian bargains to such companies.

Capital’s Das

Those who have observed her over the years say that Das managed to cultivate very effective access and networks in Delhi. Part of this stemmed from her positioning as Facebook’s real representative in India, more so that the people who have occupied the role of Facebook managing director here prior to Ajit Mohan, namely Kritiga Reddy and Umang Bedi.

This partly stemmed from the formidable ties she has within the company. Das was among FB’s earliest employees in India and is said to enjoy excellent ties with Zuckerberg, the powerful COO Sheryl Sandberg and global public policy chief Joel Kaplan.

Facebook’s and Das’ approach towards policy lobbying in India appears to have been two-pronged: while on the one hand it cultivated politicians and bureaucrats in positions of influence, on the other, it also exerted influence on the amorphous agglomeration of think tanks, events and media that shapes opinion on policy specifics. While the work on the first part happened behind the scenes, the latter was more visible. Facebook had in fact emerged as a generous sponsor of events and policy institutions in recent years and Das represented the company at such events. (Disclosure: Facebook has been a sponsor at events organised by ET.)

Over the last nine years, Das has put together an enviable public policy team, with a sizable number of hires coming in the last three years. These include a mix of lawyers, legislative assistants to members of parliament, former political consultants, and members of the civil society. This also includes notable hires from countries such as Sri Lanka. Today, Facebook’s public policy team is one of the largest in India and resembles its own large operation in Washington DC.

A Facebook spokesperson said in a statement that the allegations of partisanship against Das are “speculative and defamatory”. “Facebook’s public policy team members operate with integrity and objectivity. Any suggestion that their efforts are motivated by partisanship discounts the hard work they do every day.”

Facebook’s role in India’s polity will likely come under the lens again next month, when assembly elections commence in Bihar, the first major election under the pandemic’s shadow. Social distancing means digital platforms are the rally grounds and there’s bound to be jostling over content policy, takedowns and fake news on Facebook and Whatsapp.

With Facebook’s $5.7 billion investment in Jio, policy hawks are also eyeing the positions the two companies will take on important issues. The two companies have been on different ends of the spectrum when it comes to important policy matters such as data localisation or government surveillance. It will be interesting to watch if there’s a convergence of positions going forward.

While Facebook will now need to figure out how it can emerge from this controversy and steady its ship in policy and governance circles in the country, India’s importance in the company’s scheme of things won’t wane.

It was perhaps best articulated by the company’s VP for global affairs and communication (and a former deputy PM of the UK) Nick Clegg during a visit to India late last year. “We are now living through the years where the new rules of the internet will be written and we will look back in 20-30 years of time and sort of either regret or praise the efforts that we have made... There are three basic planets which will decide this fight for the open and closed internet: America, Europe and India. China made that call, that decision (to remain closed for global internet companies). But I think there is a real battle of the soul of where India is going to go…”

And that’s the battle Facebook will now need to wage in India. In the days to come, we will get to witness whether Zuckerberg’s hand-picked lieutenants for the battle will be familiar faces or new ones.