Press Release: Big Tech is getting Bigger

Big Tech is getting Bigger: New Report Highlights Growing Influence of Big Tech Companies

Big Tech is getting Bigger: New Report Highlights Growing Influence of Big Tech Companies

Report explores both the positive and negative impact that firms like Google, Facebook and Amazon have on India, and the possible emergence of Reliance Jio as India’s first home-grown Big Tech company.

July 29th, 2020, Goa, India: Tandem Research, a leading technology and society think tank in India, released a report today, titled A Balancing Act: The Promise and Perils of Big Tech in India. The study is based on over 400 academic and journalistic pieces, and is arguably the most exhaustive report on this topic.

It traces the emergence and consolidation of Big Tech companies in India, a trend that has been accelerated due to the Covid pandemic. The competition for Indian markets is also heating up, with Google’s plan to invest $10 bn in India and Facebook and Google’s investments in Jio Platforms.

Key Findings

  • Big Tech firms are important for India’s digital journey. Google, with 95% of India’s desktop search enquiries is a gateway to the internet for a vast majority of Indians and has considerable influence over people’s beliefs and preferences. Amazon has been running its public sector programme in India since 2017, helping government agencies and offices to switch to cloud-based systems. Aarogya Setu data is stored on AWS.
  • Foreign Big Tech firms dominate Indian markets: With more than 400 million MAUs India is WhatsApp’s largest market. Facebook has 328 million monthly active users (MAU) and a user base of 270 million users in India—the highest in the world. Amazon also has a large market presence, with at least 30% market share in e-commerce and more than 5.5 lakh sellers on its platform. Big Tech firms provide market infrastructure and innovation, but also have anti-competitive practices. This can sometimes crowd-out smaller players with less capital in the market. In 2019 alone, Amazon infused $631 million into several of its Indian subsidiaries. Addressing the market power of Big Tech companies requires updating competition policy, platform neutrality, and platform interoperability.
  • Big Tech firms affect India’s civic life: People in India increasingly rely on digital platforms—search (32%) or social media (24%)—as their main way of accessing news online. Political parties, candidates and other stakeholders spent $7.74 million to enlist the services of companies such as Google and Facebook in the run up to the 2019 Lok Sabha elections. Their platforms enable access to information and communication, but are also prone to misinformation and politicisation. To be responsible information gateways, Big Tech platforms must adhere to publisher ethics and open up their algorithms to external audit.
  • Big Tech firms lead to privacy concerns: Tech firms such as Google Pay, Amazon Pay and PhonePe, often do not explicitly state what kind of sensitive information is being collected or what grievance redressal mechanisms are available. In 2019, France Data Protection Authority levied a fine of $57 Mn to Google for breaching GDPR.Personalised services provided by Big Tech companies are valuable for many users, but can undermine individual and group privacy. In addition to individual privacy rights, we need to establish collective data rights and develop models for data stewardship. Big Tech firms must also develop privacy protecting business models.
  • Data, Taxation and Law Enforcement are big pain points: 14 out of the 15 data centres owned by Facebook are located in developed countries despite India being Facebook’s largest market. Big Tech companies products and services are filling gaps in state capacity, but this raises concerns around democratic accountability and sovereign independence. Securing India’s sovereign interests in the digital economy, requires investments in state and market capacity, fair taxation and better cross-better data flows.
  • Reliance Jio is India’s likeliest Big Tech firm: It increasingly resembles many of the markers of Big Tech. For example, In 2019, Reliance Jio set up Jio Platforms as an umbrella platform for all the Reliance-owned digital businesses. In May 2020, Jio Platforms was reported to be the fourth largest Indian company by market. With $ 10 billion Facebook investment, Reliance Jio is rapidly expanding. Jio Mart outlets across 200 cities in India. Reliance Jio is also expanding horizontally by adding new portfolios through mergers and acquisitions. Reliance spent nearly $100 billion in 2018 to acquire a diverse range of start-ups.
  • Big Tech firms are adapting to India. Due to lower ad revenues, Big Tech firms are entering the fintech sector in India. Google Pay has also clocked more than 300 million transactions in India as of June 2019, followed by Phone Pe. Similarly, to ease operations in India, Big Tech firms can be seen investing and setting up auxiliary industries in India. Flipkart is also building its own delivery network of freelancers for rural areas. Amazon India has more than 41 warehouses, with the largest being more than half a million sq. ft in size. Big Tech also places a huge emphasis on voice and vernacular services in India. In 2017, Google partnered with Reliance Jio to reuse its voice assistance technology to operate on feature phones.
  • India needs a graded approach to Big Tech regulation. Some policy pathways are implementable in the short-run, while others will require international coordination and are complex. Trying to solve the most thorny issues first might delay other, quicker fixes. For example, with CCI already considering updating competition policy in India, mergers and acquisitions can be better regulated in the short-run. However, issues such as managing cross border data flows require international policy coordination and are quite complex.

The full report can be downloaded at: www.tandemresearch.org / www.bigtechinindia.com

For more information or requests for interview, please contact: urvashi@tandemresearch.org / +91 9818921821

Press Quotes

Urvashi Aneja, co-founder of Tandem Research, said that “Conversations around Big Tech are increasingly polarised. This report seeks to find a middle ground. This is particularly important for countries like India because Big Tech companies are a part of India’s development story, filling gaps in state, market, and R&D capacity”.

Angelina Chamuah, research fellow at Tandem Research and co-author of the report, said “Power and influence of Big Tech in shaping societal and technological trajectories are likely to grow due to the Covid-19 situation. It is more urgent now, to pursue policy pathways which safeguard individual and collective autonomy and democratic accountability”.

About Tandem Research

Tandem Research is an interdisciplinary research collective, based in Goa, India, that generates policy insights at the interface of technology, society, and sustainability. We believe that evidence-based policy, supported by broad-based public engagement, must steer technology and sustainability trajectories in India. Our work seeks to ensure that no one gets left behind in the technology transitions that will shape India’s future.

Initiative

AI & Society

Authors

Urvashi Aneja

Urvashi Aneja is Founding Director of Tandem Research. She works on the governance and sociology of emerging technology; southern partnerships for humanitarian and development assistance; and the power and politics of global civil society. Urvashi is also Associate Fellow at Chatham House and a columnist for the Indian Express. She has a PhD from the Department of Politics & International Relations, University of Oxford. Previously, she was Associate Professor of International Relations at the OP Jindal Global University and Research Fellow at the Observer Research Foundation.

Angelina Chamuah

Angelina Chamuah is a Research Fellow at Tandem Research. Her current work is focused on understanding regulatory frameworks for emerging technologies in India.She is interested in studying the development of emerging technologies and the complex entanglements between technology and society. Her M.Phil. research is centered on human-machine interactions in the context of social robotics and engages with questions of design and agency in the building of affective relationalities between humans and social robots. She has an M.A and M.Phil. in Sociology from Delhi School of Economics and a B.A (H) in Sociology from Miranda House, New Delhi.