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As the world’s largest social media platform looks to the prodigious numbers in Asia to combat its decline in the West, it finds itself walking a tightrope.   © Illustration by Nakako Shiotsuki
The Big Story

Losing Face: the perils of Facebook's Asia strategy

Compromises with regional governments speed access to growth markets


PALO ALTO, NEW DELHI, HO CHI MINH CITY, MANILA, JAKARTA -- In October 2019, a T-shirt clad Mark Zuckerberg stood in front of an audience at Georgetown University and sounded a solemn warning.

"China is building its own internet focused on very different values and is now exporting their vision of the internet to other countries," he said.

"While our services, like WhatsApp, are used by protesters and activists everywhere due to strong encryption and privacy protections," Zuckerberg added, "on TikTok, the Chinese app growing quickly around the world,mentions of these same protests are censored, even here in the U.S."

"Is that the internet that we want?"

His comments painted a grim picture of free speech under attack around the world. Zuckerberg went on to defend his company in several hearings in Washington by touting its firm stance on free speech and American values.

But as the world's largest social media platform looks to the prodigious customer numbers in Asia to combat its decline in the West, it finds itself walking a tightrope: On one side is its declamatory stand on free speech, on the other its willingness to aid in censorship and disinformation to stay in promising markets.

In the last five years, Facebook’s monthly active users in the region have more than doubled to nearly 1.3 billion, compared with an increase of about 17% in North America to 259 million. During the three-months period in June, the Asia-Pacific region saw the number of daily active users increase by 28 million on the quarter, while US-Canada registered no growth and Europe lost 2 million users.

Now home to the largest share of Facebook users, the Asia-Pacific region makes up more than 40% of the company’s monthly active users. The region also had the biggest growth in revenue in 2020, with a 28.8% year-over-year jump, compared with 19.3% in North America and 20.9% in Europe.

Despite the tremendous user base and rapid growth, the Asia-Pacific and its millions of untapped mobile phones offer huge potential: The region contributed about 23% of Facebook’s total revenue in 2020. Each user in the region brought $4.16 in revenue to Facebook in the second quarter of 2021, lower than the $10.12 worldwide average and nowhere near the $53.01 per user in the U.S.-Canada.

Asia's markedly different languages, cultures and political systems, and the clashes between its principles and some of the region's autocratic regimes, have made it difficult to expand and monetize its user base. Critics say that in many cases, the world's largest social media platform has compromised on its community standards - internal policies defending free expression and cracking down on misinformation and abuse - in an effort to access commercial opportunities in the region.

"Facebook is more willing to defy certain countries than others -- and about certain matters than others," Sophie Zhang, a former Facebook data scientist who was fired in 2020, told Nikkei Asia in an interview.

“Facebook is more willing to defy certain countries than others, and about certain matters than others,” says Sophie Zhang, a former Facebook data scientist who was fired last year. (Photo by Lisa Danz)

In her farewell note to Facebook colleagues, Zhang accused the company of failing to act on evidence that fake accounts on its platform had undermined elections and political affairs around the world, including in countries such as India, Indonesia and the Philippines.

"We fundamentally disagree with Ms. Zhang's characterization of our priorities and efforts to root out abuse on our platform," a Facebook spokesperson told Nikkei.

"Our approach to removing harmful content, disrupting nefarious networks, and protecting free expression is consistent around the world," the spokesperson added.

India: profit versus people?

India, where Facebook routinely faces allegations of political bias in favor of the ruling Hindu nationalist Bharatiya Janata Party, boasts the world's largest user base on the social media network, making it hallowed ground for business and fertile soil for compromise.

More than 330 million of the country's 1.37 billion people are on Facebook, according to consumer data firm Statista. And more than 500 million are on WhatsApp, according to data from the Indian government.

Still, less than half the world's largest democracy is on the internet, offering immense potential for growth. Its 622 million active internet users are likely to climb to 900 million by 2025, according to an Indian trade organization.

But Hindu nationalism has gained momentum under the BJP government, a trend that critics say is manifested in hate speech, disinformation and physical violence, and where deadly riots can be quickly fomented by fundamentalists online. Facebook faces a rapidly developing situation which endangers not only its business prospects but also its staff.

While courting India's fast-expanding user base, Facebook has been battling a public relations crisis ever since The Wall Street Journal reported last year that its top lobbying executive in India, Ankhi Das, opposed applying the company's hate-speech rules to a politician from Prime Minister Narendra Modi's party who had in posts called Muslims "traitors." Das stepped down later that year.

Earlier this year, when Indian Prime Minister Narendra Modi was being blamed for a devastating second wave of the COVID-19 pandemic, Facebook briefly blocked a hashtag calling for his resignation.    © Reuters

In the wake of the allegations of bias, Ajit Mohan, Facebook India's managing director, said at that time that the platform was "transparent and nonpartisan," and denounced "hate and bigotry in any form."

"Many questions have been raised specifically about enforcement of our policies around hate speech," he said in a blog post. "There is no place for hate speech on our platform."

Zhang told Nikkei that the social media giant allowed a network of fake accounts connected to another BJP politician to continue operating for nearly half a year, despite the fact that she had alerted the team to the problem and called for removal of the account several times.

Facebook said Zhang's accusation that the company failed to act on pro-BJP fake accounts is "inaccurate."

The company added that they have taken down several accounts linked to Indian National Congress, the country's largest opposition party, in April 2019.

"We aggressively go after abuse around the world and have specialized teams focused on this work. As a result, we've already taken down more than 150 networks of coordinated inauthentic behavior. Around half of them were domestic networks that operated in countries around the world, including those in Asia-Pacific and India," a Facebook spokesperson said.

In response to a question from Nikkei about whether Facebook did not apply its rules to some posts linked to BJP politicians, a separate Facebook spokesperson said: "We want Facebook to be a place where people feel safe and empowered to communicate. We are taking aggressive steps to stop misinformation and harmful content from spreading on our platforms, and remove content that could potentially lead to imminent physical harm. We have clear rules against hate speech and calls for violence, and ban hateful content that violates our Community Standards, and we enforce our guidelines irrespective of anyone's political affiliation."

Earlier this year, when Prime Minister Modi was being blamed for a devastating second wave of the COVID-19 pandemic, Facebook briefly blocked a hashtag calling for the resignation of Modi amid reports that social media companies had been asked by the government to remove posts critical of its handling of the pandemic.

"We temporarily blocked this hashtag by mistake, not because the Indian government asked us to, and have since restored it," Facebook's policy communications director Andy Stone said on Twitter after users flooded the platform with questions about why "#ResignModi" was blocked.

New information technology rules in India that came into effect on May 26 have exacerbated tensions between Facebook and the government, with guidelines requiring additional due diligence by large social media platforms, all of which need to appoint a chief compliance officer, a "nodal contact person" to coordinate with law enforcement agencies around the clock, and a resident grievance officer.

The rules require the social media purveyors to swiftly remove any content flagged by authorities and to share details about the originators of certain messages. The platforms also must publish monthly compliance reports with details of complaints received, actions taken and details of content proactively removed.

"These rules threaten the idea of a free and open internet built on a bedrock of international human rights standards," the Electronic Frontier Foundation, a San Fransisco-based digital rights group, wrote in April, adding that they allow government surveillance of citizens.

Facebook has said the company respects Indian law and is committed to safety and privacy for its users. The only point of public conflict over the new rules is that Facebook-owned WhatsApp has challenged the government in the Delhi High Court over the identification of the "first originator," arguing the requirement violates privacy rights and is unconstitutional. Compliance would circumvent its end-to-end encryption, a key feature the company has repeatedly used in marketing, say experts.

"We have made significant efforts to work toward compliance with the provisions of the IT rules and continue to discuss a few of the issues which need more engagement with the government. We remain committed to people's ability to freely and safely express themselves on our platform" the Facebook spokesperson said.

Experts say, however, that in the main, Facebook has accommodated the new legal landscape. "Facebook sees India as a potential growth market and doesn't seem to have any problem with complying with the new rules," points out Manoj Gairola, a telecom expert. "WhatsApp is concerned about the 'originator' clause, and that is the only issue which appears to be troubling it," he told Nikkei.

In line with the new guidelines, Facebook in July released its maiden monthly India report for the period between May 15 and June 15, saying it took action against over 30 million pieces of content across 10 different violation categories, including 1.8 million relating to "adult nudity and sexual activity," 2.5 million on "violent and graphic content," and 25 million containing "spam."

"I think social media giants are aware of the mammoth task they have on hand, and they also have to abide by the rules of the land," Vineeta Dwivedi, head of digital communications at the Mumbai-based S.P. Jain Institute of Management and Research, told Nikkei.

Separately, a group of United Nations special rapporteurs, in a June 11 letter to the Indian government, expressed "serious concern" about the obligations on companies to monitor and rapidly remove user-generated content, which they fear is likely to undermine the right to freedom of expression. "In particular, we worry that intermediaries will overcomply with takedown requests to limit their liability, or will develop digital recognition-based content removal systems or automated tools to restrict content."

The Indian government says the concerns alleging potential implications for freedom of expression are "highly misplaced," and that the new guidelines seek only limited information.

Harshita Bhatnagar, a former national ICT expert at the Asian Development Bank, said all social media platforms have to follow the law of the land if they want to grow their business in India because there are no domestic replacements, unlike in neighboring China, which has several "good" platforms of its own.

"India does not have any popular apps," Bhatnagar said. "Maybe five years from now, India might be in a position to throw [these global social media giants] out of the country, but not at this point."

Vietnam: censored but irreplaceable

Facebook, whose site was translated into Vietnamese in 2008, started off as a breath of fresh air for people seeking outlets beyond state-controlled media in Vietnam. But as the country of nearly 100 million became one of Facebook's biggest foreign markets by revenue, activists feel the tool has been turned against them.

The popular platform, initially loved for enabling critics to bypass the communist system's strict control on the media, now repeatedly censors dissent in Vietnam in response to a government that has threatened to block it.

"[W]e do restrict some content in Vietnam to ensure our services remain available for millions of people who rely on them every day," Facebook said in response to questions from Nikkei.

When human rights and environmental activist Quyet Ho tried to share posts on the social network, he ran smack into the government's censorship strategy. State-backed trolls would falsely flag his posts as violating the company's terms, and a critical mass of complaints could lead to Facebook blocking the content, Ho said, adding that political terms like "vote" in his posts would keep them from getting published at all.

This strategy differs from the state's better-known method of sending official takedown demands to Facebook, which said these include "content opposing the Communist Party and the government of Vietnam."

The campaigns to report critics to Facebook allow the government to censor without official takedown orders, said Legal Initiatives for Vietnam co-director Vi Tran. She said this tactic also benefits Facebook, which publishes data on removal requests by governments, but not by social media trolls and influencers. Facebook, for its part, said mass reporting does not influence its decision on whether a post violates its terms.

Force 47, the Vietnamese army's online information warfare unit, was set up in 2016 with thousands of people whose job is to post on pro-state Facebook groups and correct "wrong views" on social media. While there is no official definition of a "wrong view" in Vietnam, activists have been sentenced to 10 years or more in prison for posting "anti-state propaganda" on Facebook, or opinions that are not in line with the regime.

Vietnam brings in revenue of nearly $1 billion to Facebook, Reuters said in a report late last year.   © AFP/Jiji

"Unlike their peers in Thailand, Malaysia or the Philippines, Vietnam's cyber troops have been encouraged to use real accounts to mass-report content," ISEAS-Yusof Ishak Institute visiting fellow Dien Luong wrote in a report on online nationalism. "This helps explain why Vietnam has been the only country in the region to acknowledge its authorities' deployment of cyber troops."

In the Facebook-Vietnam faceoff, the state has moved away from attempts to bar the site entirely, opting instead to sway public opinion by setting up many of its own pages, verified by blue check marks. It is alert to the benefits of social media as a way for citizens to blow off steam, such as anti-Chinese sentiment, so long as it does not end up scalding the regime itself, Dien said.

When asked about Force 47's trolling, Facebook said it took down some pages in July.

"We've removed some Facebook groups and accounts in Vietnam for coordinating attempts to mass-report content on Facebook," a spokesperson told Nikkei. This coordination "undermines the integrity of our systems."

Vietnam and Facebook have a symbiotic relationship, said Nguyen The Phuong, a research fellow at Vietnam National University's Center for International Studies. He said the country needs the platform for e-commerce and information, and Facebook needs Vietnam for traffic and revenue.

Vietnam brings in revenue of nearly $1 billion to Facebook, Reuters said in a report late last year, citing sources familiar with the numbers.

"I don't think Facebook cares to protect the free speech of the activists because I think we are a very small community among the 60 million Facebook users in Vietnam," Tran said, adding she has struggled to reach the company to discuss its rights policy. "We don't have anything to bargain with."

Facebook does not pay a price, such as a public backlash, for curbing expression, Tran said, but the company appears to have paid a price for not curbing expression enough. Facebook said local servers were taken offline for a period in 2020, pressuring it to restrict more content. It reluctantly complied with the government's request to block content that the government deemed to be illegal.

While activists said Vietnam needs Facebook too much to outlaw it, the company said it faced a "rapid rise in attempts to block our services in Vietnam."

The government also urges citizens to post about "the nice culture of Vietnam" and promote "a good image and good deeds," as detailed in a new social media code of conduct.

Previously the company told Nikkei that two countries use its chat functions for e-commerce more than anywhere else: Vietnam and Thailand. With so many people glued to Facebook, locals believe it has negotiating leverage with the government, which it is not using to the fullest.

"Facebook knows it has a big competitive advantage," Phuong said in a video call on Facebook's WhatsApp. "It can't be replaced in Vietnam."

Philippines: Duterte and the 2022 election

President Rodrigo Duterte and boxing legend Sen. Manny Pacquiao have been sparring publicly over the 2022 presidential elections, and Facebook's fact-checking partner in the Philippines has an uncomfortable ringside seat.

Nonprofit news organization Vera Files, which monitors and flags problematic content on Facebook, has noticed an uptick in fake news targeting Pacquiao, who might go up against Duterte's daughter, Sara Duterte-Carpio (commonly known as Inday Sara), for the top public office in an election next year.

One post falsely stating that Pacquiao, who grew up in extreme poverty, admitted to being "guilty" of "being dumb" due to lack of an education elicited 25,000 reactions, 3,800 shares and 4,000 comments. Another video that went viral on Facebook falsely claimed that Duterte gave proof that Pacquiao paid a university for a college diploma. Those fake claims partly echoed Duterte's insults to Pacquiao in June, when he said the boxer "should study first," in response to criticism leveled against his administration.

Posts like these were rated "false" by fact-checkers at Vera Files, one step in a longer process that can reduce their visibility on the platform.

President Rodrigo Duterte, left,  and boxing legend Senator Manny Pacquiao have been sparring publicly over the 2022 presidential elections, with Facebook stuck in the middle. (Source photos by Reuters and Getty Images) 

But that is just the tip of the iceberg in the Philippines, which boasts the world's most active social media population, with users spending more than four hours a day on social feeds, compared with about two hours in the United States, according to market research firm eMarketer. This makes it a prime market for Facebook, which has an office in Manila, and in 2017 partnered with Duterte's administration on a high-speed internet infrastructure project.

This has meant Facebook must constantly maneuver between government and opposition in an effort to appear neutral, a balancing act that is harder and harder to manage. "We have an important responsibility to help people participate in elections in the Philippines and around the world, and to ensure these elections are safe and secure," said a Facebook spokesperson.

Duterte's camp has been said to employ armies who troll opponents and spread misinformation about critics on Facebook. This has turned out to be an effective tool to sway public opinion in a country where more than 72% of more than 100 million people get their news from social media, and primarily from Facebook, according to a survey by The Reuters Institute for the Study of Journalism and Oxford University.

"We're working closely with civil society, electoral authorities and the industry, and will make further announcements on our election efforts in the lead-up to next year's vote," the Facebook spokesperson added.

As disinformation and political pressure on Facebook are expected to escalate in the next 10 months heading into the presidential elections, 12 Philippine senators are seeking an investigation into reports that public funds are being used for troll farms.

One of the senators, Risa Hontiveros, says "Facebook is synonymous with the internet," as she credits the social media giant's free service for enabling millions of Filipinos to get online.

Yet the senator, one of the few opposition voices in the 24-member legislative chamber controlled by Duterte's allies, has been a perennial victim of fake news on Facebook.

"As someone who has been targeted by disinformation since 2016, I can say that fake news about me persists up to this day," said the senator, who has been falsely tagged as supporter of a rebellion in southern Philippines, among other things.

"It is crucial that Facebook step up its efforts to combat fake content, especially in the run-up to the 2022 elections," Hontiveros, who will be facing reelection, told Nikkei.

But this comes at a price. In 2020, Facebook angered Duterte by taking down dozens of accounts linked with the Philippine police and military, who lead Duterte's war on drugs and insurgency, for "coordinated inauthentic behavior."

In a thinly veiled threat against the social media giant, Duterte said, "Is there life after Facebook? I don't know, but we have to talk." Following Duterte's threat, Facebook met with Philippine officials last year to answer questions about its approach to coordinated inauthentic behavior, but it did not reinstate the accounts.

Disinformation in the Philippines has become a hot button that has complicated public discourse around Manila's ongoing drug war. According to Human Rights Watch, the government has "stifled critical media voices."

Maria Ressa, an award-winning journalist and co-founder of the Philippine online news site Rappler, has faced a slew of charges for cyber libel, tax evasion and securities fraud, moves that she has called harassment for speaking truth to power.

Ressa, who has investigated the government's use of social media and written stories critical of Duterte, has routinely come under attack from trolls on Facebook since he came to power in 2016. At one point, she was the target of 90 hate messages an hour on the social network, according to an analysis by the International Center for Journalists.

Facebook is being used as a platform that is "dividing and radicalizing us," Ressa told international broadcaster Voice of America in July.

Indonesia: disinformation hurting progress on pandemic

Indonesian President Joko Widodo has 40 million followers on Instagram, easily double that of his U.S. counterpart, Joe Biden, a gap that clearly illustrates the significance of the Asian market for Facebook.

Social media "likes" play an important role in the local political scene, and disinformation is hard to weed out in the WhatsApp-obsessed nation, where 69 million people are sharing content on a platform that is encrypted end to end, making it difficult to trace and curb the spread of rumors.

The closed nature of WhatsApp also means most use it to communicate with people they know and consider trustworthy. And the ability to forward content easily to groups of as many as 256 people also allows false information to spread quickly.

Health-related content dominates hoaxes that go viral in a nation that is currently the global epicenter of the COVID-19 pandemic, according to local watchdog Indonesian Anti-Hoax Community, or Mafindo, slowing the government's efforts to control the virus outbreak and accelerate inoculation.

One recent message that went viral on WhatsApp said that three ambulances driving around recklessly hit a car. When interrogated, the drivers said they were told to drive empty ambulances around to scare the public into believing that the virus was spreading, the message said.

This had harmful repercussions as people abandoned health and safety protocols during the surge of the coronavirus in Indonesia, where COVID-19 reported cases have crossed 3 million and reported deaths have surpassed 85,000. Local news portal, one of Facebook's fact checking partners, said the ambulances were returning from a cemetery after carrying COVID-19 victims.

In Indonesia, WhatsApp has beaten Instagram and Facebook to become the second-most widely used social platform, after Youtube.   © AFP/Jiji

Mafindo Chairman Septiaji Eko Nugroho said such hoaxes are particularly rampant on Facebook-owned WhatsApp, exacerbated by poor digital literacy among many Indonesians. WhatsApp has beaten Instagram and Facebook to become the second-most widely used social platform in Indonesia, after YouTube, according to a report earlier this year by social media consultancies We Are Social and Hootsuite.

"WhatsApp groups in villages, among Islamic congregations and church groups have become a very common means of communications today," Nugroho told a webinar in June. "The problem is when people see a topic or news [on WhatsApp], [many] don't know how to confirm it. They don't know how to browse. They don't [even] know how to open [other] social media platforms."

However, critics argue that efforts to combat disinformation have emboldened the government to expand its use of controls on free speech to stifle legitimate political dissent. Indeed, there is growing evidence of the government's abuse of the law on electronics information and transaction, known as the ITE law, to crack down on its critics.

Amnesty International said the ITE law was invoked 119 times last year in cases involving freedom of speech violations, up from 78 in 2019 and the highest since 2014 -- which partially reflects the growing popularity of social media in the country. The rights group said many were charged with libel or hate speech clauses in the law after criticizing government policies.

Heru Sutadi, executive director of Jakarta-based think tank Indonesia ICT Institute, said Facebook is a part of the law's problematic implementation. He cited an example of a hard-line Muslim cleric who is also a staunch government critic and was recently sentenced to nearly five years in prison for COVID-19 health protocol violations. Facebook posts criticizing the sentence "automatically disappeared," he said. While many such posts contain hate speech or hoaxes, Sutadi said Facebook's local fact-checker partners have failed to accommodate opposing opinions.

"Indonesia is currently divided into those who are very pro-regime and those very critical of the regime. While engaging the fact checkers is good, they ... tend to be lenient with pro-regime [posts] and see all the critical ones at fault," Sutadi told Nikkei. "In the end, we see social media taking sides when they should be impartial if they want to safeguard freedom of speech."

A new regulation that will take effect in December, known as Ministerial Regulation 5, will allow the government to tax foreign electronic platforms and deepen the platforms' involvement in policing Indonesia's social media space.

One of the contentious clauses in the new decree obliges all "electronic system providers" to ensure there is no "prohibited" content on their platforms, including content that is "unlawful" or "upsets the public and disrupts public order." Failure to comply could lead to the social media platforms being blocked.

"We recognize the importance of internet regulation that is balanced. Regulation must respect the basic rights of netizens around the world, including the right to free expression, while also protecting them from online harms and supporting local innovations," a Facebook spokesperson said in response to questions about the new regulations.

"We've long advocated for rules that strengthen privacy and the benefits of an open and accessible internet, and continue to actively engage with KOMINFO [the Ministry of Communication and Information Technology]," the spokesperson added.

"Ministerial Regulation 5 is a tool for censorship that imposes unrealistic burdens on the many digital services and platforms that are used in Indonesia," said Linda Lakhdhir, Asia legal adviser at Human Rights Watch. "It poses serious risks to the privacy, freedom of speech, and access to information of Indonesian internet users."

In defense of the new regulation, the communications ministry's director general for informatics applications, Semuel Pangerapan, said it was aimed at giving all electronic platforms a "level playing field," while protecting the public from "various digital threats."

"It's the government's duty to protect data in the digital space, including from the spread of negative content, personal data abuse, child sexual exploitations and digital-based terrorist radicalization," Pangerapan said.

China: out but not down

Even in China, where Facebook refused to cave in to censorship and ended up getting blocked, the company is willing to do business.

Zuckerberg has repeatedly criticized China's chokehold on free expression, and used it as an example of the type of threat that Facebook is helping defend against. However, China contributed more than $5 billion in annual advertising sales to Facebook in 2018, making it the second-largest revenue generator after the U.S. that year, according to a report by Pivotal Research, an equity research firm.

Before the COVID-19 pandemic hit, Facebook would fly dozens of Chinese companies' executives to its Menlo Park headquarters every year, where it would hold free seminars to educate them on how to leverage their platforms to grow their businesses, a source with direct knowledge told Nikkei.

Mark Zuckerberg greets Chinese President Xi Jinping: “China has been and always will be a trying but important market for Facebook,” a source told Nikkei.    © Reuters

"China has been and always will be a trying but important market for Facebook," the source added.

"For the domestic Chinese consumer market, I don't see that possibility [Facebook being accessible in the mainland in coming years] but Chinese companies have been working with Facebook for marketing overseas," said Xiaofeng Wang, an analyst at research and advisory specialist Forrester.

Facebook is positioning itself as a conduit for Chinese advertisers who have to work around internet restrictions in China known as the "great firewall." On Chinese messaging platform WeChat, Facebook in 2019 said it "is committed to becoming the best marketing platform for Chinese companies going abroad."

Facebook said prior to COVID-19, it invited senior executives from companies all around the world to its headquarters in Menlo Park, California, on a regular basis, not exclusively from China, as a way to understand clients' needs and discuss how to help them grow internationally.

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