Madhavan NarayananSep 25, 2018 16:21:33 IST
Finally, there is a refreshing status update from Facebook in India, as it gets a new managing director in Ajit Mohan, who by all accounts seems eminently qualified to handle the position. But that is not an easy place to be. What was thought to be one of the coolest jobs in India's corporate world is now a veritable hot seat. It would be appropriate if there is a relationship status indicating the equation between the Indian market and the world's awesome social network covering 2.2 billion monthly active users that says: "It is complicated."
Mohan has been plucked out of Star Network's successful mobile app, Hotstar, and was earlier with global consulting giant McKinsey. The combination is right because he has to grow the revenues in an exploding mobile internet environment and also tackle the difficulties of strategy in a world where Google is trying to bite at its heels.
But the real deal in what was thought to be a cruising monopoly of more than 240 million users seems to be an uncertain landscape of regulation and politics that calls for more than good business sense. It needs an understanding of the dynamics in the shifting sands of data politics in which lobbying power may have replaced advertising algorithms as the leadership differentiator.
Facebook's India chief's seat has been lying vacant for about a year now after the exit of Umang Bedi. In the eventful year, the game has decidedly shifted from wooing advertisers to go digital (they no longer need that) to telling a clutch of policy-makers, influencers, media watchdogs, politicians and regulators that Facebook means well for India.
The social media giant lost one big battle about three years ago when the Telecom Regulatory Authority of India (TRAI) cracked down on Facebook's Free Basics initiative on the ground that it will violate the principles of net neutrality that separates access from content. Worse was to come later. From all indications, there is more lobbying lungpower needed in the days ahead.
Two months ago, the government asked the Central Bureau of Investigation (CBI) to launch a probe into political consultancy Cambridge Analytica’s misuse of Facebook user data as part of a worldwide drive that hit the company. More importantly, TRAI said that the existing framework for the protection of personal data by companies and service providers was insufficient and recommended tougher rules to check data breach.
A nationalist lobby has emerged over the past year within the technology space, demanding everything from special voting rights for locals to data localisation — the business of storing valuable user data in Indian silo-servers.
What all this means for Facebook and Google is an erosion of easy global management and economic efficiencies that would have made business easier. Data nationalism seems like a throwback to the early 1970s, when the Foreign Exchange Regulation Act forced multinationals to restrict their stockholding in Indian subsidiaries. Ajit Mohan will now have to wade into data socialism in the age of a globalised internet. This would probably mean working with arch-rival Google to share the Indian market. Only the other day, Google's CEO Sundar Pichai was writing to the government against data localisation. While the Reserve Bank of India has mandated data localisation for financial purposes, the draft of a data protection law proposed by the BN Srikrishna committee wants overall data localisation.
For Google and Facebook, what was thought to be a smooth athletic track has now become a steeplechase.
It doesn't help for Facebook that India is heading into an election year with the government in power having a perceptible nationalist tilt after its early years embracing the internet giants. Ajit Mohan would have to likely wait for a year for the clouds to clear on cloud computing in India because it would be difficult for the BJP to do anything perceived to be benign to multinationals.
Facebook-owned WhatsApp has had to face pressures in India linked to rumours that sparked lynching and other related crimes. The company is increasingly accountable for what is happening under its nose through WhatsApp even as it tries encryption and other methods to ensure privacy. It has just hired a grievance officer to back up its awareness campaigns to prevent abuse of the mobile messaging service.
From his past employer Hotstar to Google's YouTube, Mohan has a slew of digital-era competitors in seeking a higher share of advertising rupees. While 'Data is the new oil' seems like a cool slogan, the new-age oil tankers may be sliding into digital-era oil embargos and Facebook may have to watch its steps all the way.
The Internet and Mobile Association of India (IAMAI) said this month that incumbent companies under the proposed data law "may refuse to share data with potential competitors, or demand a premium price for anonymised data products."
Meanwhile, data privacy is being viewed as an emerging priority in India with the Srikrishna draft also talking of a privacy regulator.
In such a landscape, competition laws may increasingly come into play and Facebook just cannot sit tight and laugh its way to the bank as data-sharing and data-denial come into scrutiny. Ajit Mohan has challenging days ahead.
The author is an independent journalist and columnist.
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