The Battle for India’s Digital Soul

India's 1.4B consumers form a juicy proposition for online platforms. The proposed Digital India Bill seeks to regulate the space. Does privacy from tech companies imply increased govt surveillance?

I sometimes volunteer at a little non-profit school. It’s growing at a very healthy rate and the management has now been forced to expand its presence to multiple WhatsApp groups.

The influx of messages there had left me somewhat comatose. So I asked them why they don’t use an alternative solution based on email/ text. The implications of what they told me perhaps goes far beyond the little confines of the school and sheds light on the entire digital landscape in India.

They said that their students (many of who are from non-privileged backgrounds) may not know how to use email (or ever check texts), but they ALL use WhatsApp.

An unquestionable monopoly on messaging

WhatsApp is used for virtually everything in India from sharing class details to maintaining social relationships of every colour (from your grocer to your auto/ cab driver, boss, colleagues, friends, spouse, educational institutions, banks and one’s parents). Most people are even comfortable sharing highly sensitive information including private images and financial information.

In fact, it’s rather rare for most Indians to wake up and not receive at least one good morning text from a well-wishing uncle or aunt on WhatsApp.

S/he is considered a social recluse.

Such a monopoly may be rarer in other parts of the world, but routine among digital products in India.

For the little school though, it’s a double-edged sword.

Since the organization is growing, the management is keen on more automated solutions. But as they are working for a cause, they need mediums that are popular with the students. Unsurprisingly, ‘free’ solutions like WhatsApp top the list. And most are reluctant to use any other platform that they are not intimately familiar with.

But integrations with WhatsApp cost money. Getting access to WA cloud API may be free, but the messages are chargeable.

WhatsApp, aka Meta, has found the holy grail of consumers in the Indian market.

India is WA’s largest market with more than 450 million users. They are sticky customers of WA because:

1. Familiarity

2. Low literacy of tech

3. Low awareness of options

4. Peer pressure from friends and family

5. Inertia

In 2022, WhatsApp’s share of mobile messaging app users in India stood at a whopping 97.1%.

Absolute majority with severe privacy issues

Meta has shown that while it might be hard to break into the Indian market, once you do (and solve a use case underserved by others), Indians are probably some of the stickiest customers on the planet.

Just to cite one example of the outsized influence of WA, the government recently required all mobile carriers to implement AI spam filters.

Almost overnight, international spam calls and messages on WA exploded, prompting a notice from the Indian IT ministry.

Not a good look for the company already under fire for two separate cases of privacy violations:

1. Extensive microphone usage in early morning hours to snoop on users (Meta has blamed Google’s Android system for this ‘lapse’.)

2. A court case debating whether WA privacy policy actually helps it to funnel user info to FB for advertising.

For privacy advocates though, India’s populous digital landscape is a minefield of nightmares because both for-profit companies as well as regulation take full advantage of the continued low consumer awareness of digital rights.

However, the government is slowly moving towards more regulation.

Regulation incoming for online services, AI and semiconductor research

India is set to debut its first AI act in June with the Digital India Bill and the government (due for re-election next year) intends to protect users from companies seeking to exploit or misuse user data, implement AI guardrails and more - also giving itself sweeping powers in the process.

This includes a government fact-checking service with the power to order takedowns with harsh timelines (that has met with resistance on free speech grounds), user traceability even on encrypted messaging platforms and at least modifying, if not removing, safe harbour provisions for online services that exempts them from liability for user content.

Other proposed provisions include fake news moderation, age-based restrictions for services deemed addictive, algorithmic risk assessments, rules on content monetization and a governance framework for semiconductor R&D. Also,AI guardrails and rules to define & govern high-risk uses.

Does more regulation imply more privacy or increased surveillance?

To be clear, traceability to first originator (the provision that rankles most with messaging platforms) does not require a continuous streaming of metadata to authorities. But rather to supply authorities with that info when asked about particular users.

In fact, the government assures that it will only be implemented in cases where there is potential for imprisonment of more than 5 years and cases that threaten the security, sovereignty of the nation, rape etc.

This doesn’t bode confidence as authorities in the country have a reputation for being a little trigger-happy with sedition laws in the past.

Moreover, most data protection authorities opine that data minimization is a core component of data protection.

Traceability does the exact opposite. It forces online platforms to retain even more user data. A concrete step back from the metadata deletion process now followed by many.

All in all, Indian digital consumers, a swelling base of 1.4 Billion and perhaps the last under explored customer bastion of Silicon Valley, may find themselves stuck between a rock and a hard place in the battle for India’s digital soul.