A<eem offers this interesting tidbit form his “Exponential View” newsletter.
You may have heard about the skirmishing between Indian and Chinese troops along the border between these two huge nations.
You may not have heard about India’s reaction
This week, the battle between the two nuclear-armed powers moved to another arena: the digital market. India banned 59 Chinese apps, including TikTok and WeChat.
What’s the big deal?
TikTok has more than 200 million users in India, and it may be TikTok’s biggest market.Some Indian TikTokers have millions of followers, charging thousands of dollars to post clips. Startups like EduTok have been built on the platform.
As Azeem reports,
- Data localization has been going on in India for a few years, requiring companies to store critical user data in India. (See my essay on our spiky fragmented world.)
- In 2018, India took action against large foreign e-commerce platforms, preventing marketplaces from offering exclusive products, and influencing the sale price of goods and services. See EV#198 for more.
Does this matter?
India is a massively attractive market. Only a quarter of India’s 1.4 billion people has a smartphone. It is already a huge market and only going to get bigger. The Indian startup scene is booming. More than $14 billion went into India’s startups in 2019. Local venture capital is booming. ISP, Reliance Jio, raised more than £15 billion from Facebook, Silverlake, KKR and others.
What should we make of this?
- National sovereignty matters. It is through national laws that this ban will be enforced. The Internet as an independently regulated cyberspace is rapidly becoming a thing of the past.
- India has demonstrated that it will seek to intervene to further its national interests. Yes, the ban on 59 Chinese apps can be seen through the lens of Sino-Indian competition. But the Indian government had previously made life harder for American retailers, Amazon and Walmart.
- Global decoupling is not just a gruelling sparring session between China and America. Rather it reflects a series of different pressures, some security-driven, some economic, but all about sovereignty in the face of technology change, that we are seeing expressed by the UK, EU and, of course, India.
In short, the earlier dream of the web as transcending nationality is not panning out. And when you add to that mix, government backed disinformation projects that target the politics of other countries, you get a rather messy situation.