Twitter in India: worth the headache?

Is it possible to get bigger and smaller all at the same time?

You wouldn’t think so. Those are opposites, right? Yet, that seems to be what is being demanded of businesses in 2021 — a push and pull between their investors and the regulatory bodies that they must satisfy. 

At the root of this is a shift towards domestic protectionism around the world. We see this everywhere and it isn’t restricted to one side of the political spectrum. Both the left and the right —  and everywhere in between  — seems to be shifting away from a global perspective, in favor of measures that are designed to protect the home market. 

From Brexit, to the US antitrust battles, to China getting back to its more authoritarian instincts, this is a change from the 40 years prior when Free Trade and open borders was all the rage. 

For investors and business leaders this is a frustrating development. The former demand growth and the latter are being restrained in how they can find new markets to get into, so they can provide that growth. 

One battleground for that in particular is India — an ancient and dynamic culture that has long baffled and intrigued the Western business world. It is just a difficult place to get a handle on if you are not from there (and even if you are from there, in some cases).

Under the current Modi government that’s become even more difficult, as he has followed the protectionist trend that I spoke of above. This manifests itself in a lot of different ways, but for now I want to look at one specific example to illustrate the challenges that exist to effectively operate in India for non-Indian companies. 

Specifically, Twitter (NYSE:TWTR) losing its immunity for user generated content in a court ruling yesterday. The simplest way to understand what this means is that Twitter can now be held legally accountable for things that are posted on the site. 

You might think “good” — companies should be held accountable for hate speech and other illegal activities that are promoted. And if those were black and white things, you’d have a point. However, what constitutes hate in one part of the world, or what is illegal, varies dramatically. In effect, what the Indian law is doing is attempting to wrestle content control away from Twitter so it can remove anything that it finds offensive, or harmful to its political agenda. 

For instance, last month a Hindu group filed a complaint because a map appeared on Twitter that showed the Kashmir region — which is disputed territory — to be outside India. Dealing with the decades long dispute between India and Pakistan is not high on the priority list for things it wants to get involved in for a company like Twitter. No, it just wants to provide Indians with the same opportunity to be part of the app as it does around the world. 

But, now it might not be able to. 

That’s because as big and alluring as the Indian market is, this change very well could result in Twitter simply pulling the plug on operating in the country. The protectionist forces will have claimed another victory in its fight to make the world a bit smaller. 

It’s not my place to say whether that’s good or bad, but it is certainly worth watching as this is just one example of a growing trend.