The Great Indian Techlash

After more than a decade of laissez faire, the regulatory climate for tech giants is intensifying in India. Given their growing heft, abysmal record of self-policing together with the perceived threat to market competition and democracy itself, this is touted to further intensify and gain momentum.

Tech firms of today are known to provide platforms through which people interact or transact. They may be for sharing content, exchanging messages, availing goods or services or for simply surfing the internet.

Honeymoon period over

Now, regulators worldwide seem to believe that the era when tech platforms operated in a parallel legal universe and enjoyed immunity from user actions or the harm trickling from their services into the real world, cannot last forever. Nor can they forever be two-headed beasts that not only operate a market but compete in it too by promoting their own products or services.

A justified worrisome fact in this context is the falcon’s grip that tech oligopolies have over data which gives them a distinctive advantage over the entire consumer economy: search engines can see what we search, social media platforms what we speak, and marketplace platforms what we buy.

Amidst mounting pressure, belatedly content platforms are deploying artificial intelligence and armies of moderators to police their sites. Likewise, marketplace platforms are attempting to imbibe discipline while facilitating goods and services. But governments, particularly in India, evidently want them to do more..

Rules being re-written

In May earlier this year, the Indian government enforced new intermediary rules that hold social-media platforms far more responsible for the content they host and require messaging firms to reveal the source of any message thus breaking end-to-end encryption and endangering users’ privacy.

Subsequently in June, the government introduced interventionist proposals to amend the consumer protection e-commerce rules to impose discipline and ensure transparency in the operation of e-commerce platforms.

Critics now worry that the intermediary rules are heavy on punishment, rife with risk of litigation for big tech employees and may have a chilling effect on constitutional guarantees of free speech and privacy..

Ecommerce rules have been criticized for imposing a higher compliance burden and hurting the sellers and the consumers. With retraction of these measures seeming unlikely even after the recent cabinet reshuffle, the techlash is only set to grow.

India not alone but…

India is not unique in its dilemma of regulating big tech. Lawmakers and regulators across the world from developed economies such as the US, UK and EU to countries like Nigeria, are rewriting the rules on how big tech can behave in the bloc, albeit with varying degrees of motivations and perspectives driven by far ranging legal concerns like antitrust, content moderation and data privacy.

Yet, India remains singular in its regulatory approach to rein in the big tech – right from its perception of the basic problems, lack of a balanced and nuanced debate, to devising solutions that would create far more problems than they solve..

The new rules reflect a reactive approach of the Indian government to contain the problems, instead of thoughtful proactive constraints of big tech upfront.

The last word

What is big tech’s most valuable resource today – data. The more appropriate manner to impose the initial shackles would have been to regulate the data on which big tech’s business models are anchored by enacting the personal data protection law.

Instead, the precedence of political necessities over economic prudence brought about piecemeal rules marred thus far by uncertain scope and unpredictable application. Undoubtedly, the Government has good reasons to regulate big tech. But the incessant quest towards digital protectionism sans reflection threatens to create splinternet bound to harm the Indian digital economy more than the evils it seeks to dispel.

https://cfo.economictimes.indiatimes.com/news/the-great-indian-techlash/84698757