After a troublesome 2022, when the Meta stock hit a low of $90, the company has bounced back strongly, surging as much as 271% on the US stock exchange this year, as of December 15. 

While the tech giant saw a revival on the back of stronger-than-expected financial results for the company’s second quarter of 2023, the exceptional performance of the company was anchored in various tailwinds, including a suitable growth environment in the home country, improving market sentiment, and aggressive cost-cutting, just to count a few.

However, in stark contrast, the company’s India stay was not very comfortable during the year, as it had its fair share of fires to douse on the regulatory front. 

While regulatory bottlenecks were one of the recurring peeves for Meta’s operations in the country, the social media major was time and again cornered by Indian courts and law enforcement agencies for failing to keep a check on notorious elements, such as deepfakes and misinformation, doing rounds on the platform.

During the year, Indian authorities also unearthed an alleged INR 10,000 tax fraud involving Facebook sellers. Meanwhile, weak global cues forced Meta to cut corners, resulting in an undisclosed number of mass layoffs at its India office. 

Amid all this, the company also grabbed headlines after some of its shareholders mounted an offensive for its alleged bias in India operations. 

Notwithstanding the challenges, 2023 also turned out to be the year during which Meta kicked into motion a full-scale monetisation plan with Meta verified and a slew of offerings for merchants. The Indian arm continued to rake in hefty revenues while the ad business saw considerable growth in the country. 

However, despite gaining a huge response at the outset, its much-touted new launch ‘Threads’ turned out to be a dud. For the uninitiated, Threads is Meta’s answer to X and is focussed on textual conversations, rather than visual media. 

As we approach the end of 2023, let’s steal a glance at the journey of the social media juggernaut in India this year.

Meta’s Sabre-Rattling With The Govt Continued In 2023

The Mark Zuckerberg-led company found itself roiling in a bevy of regulatory challenges throughout the year. As the Centre undertook a flurry of reforms in the form of the Digital Personal Data Protection Act and the new IT Rules, Meta found itself burdened with additional compliance requirements and mandates.

The adverse regulations also made the company liable for hefty fines and opened Meta to potential lawsuits if users’ grievances went unresolved. With little wriggle room under the new laws, the fear of losing safe harbour protections sent alarm bells ringing for the social media behemoth. 

“While the exact impact of the Digital Personal Data Protection (DPDP) Act is yet to be seen, there might be some implications on the storage and transfer of data of Indian subjects.  This might have more of an implication for Meta as their tech implementation might have to significantly change,” identity verification platform IDfy’s chief executive officer (CEO) Ashok Hariharan told Inc42.

What also proved to be a major headache for the company were the large number of content take-down requests by the Indian government. The country emerged as the second biggest source of government requests to Meta in the first half of 2023, second only to the US. 

Between January and June 2023, Indian authorities issued 70,612 requests, of which 63,586 were legal process requests while the remaining were ‘emergency disclosure requests’. 

Curiously, Meta’s worst hit arm in India appeared to be WhatsApp, which found itself at the centre of many regulations. A Competition Commission of India (CCI ) probe into WhatsApp’s 2021 privacy policy case continued to be in limbo. 

As if these issues were not enough, generative AI became a cause of concern for Meta. The deepfake controversy, involving actor Rashmika Mandanna, saw Facebook at the centre of enforcement action as authorities issued notices to the company to act on synthetic content and reveal information about the origins of the post. 

A Long List Of Troubles For Meta India

Amid a tussle with government authorities, Meta also found itself in the middle of other controversies that grabbed negative headlines throughout the year. 

A case in point is the consultation paper floated by the Telecom Regulatory Authority of India (TRAI), which explored the idea of bringing OTT communication apps under the regulatory ambit and selective banning of such apps. 

The aftermath triggered a full-blown war with telcos and startups as telecom operators pitched for a revenue-sharing framework with OTT platforms based on network traffic as a parameter. The proposed move directly strikes at the heart of Meta as it consumes a major chunk of telecom bandwidth domestically. 

Making matters worse was the surge in pesky job calls to WhatsApp’s India users from international mobile numbers. The controversy made the government crack its whip on Meta yet again. Subsequently, 66,000 WhatsApp accounts and 8 Lakh payment wallets were deactivated.

WhatsApp also continued to face outages in the country. Meanwhile, one of the major issues that shook Meta in India came from an unlikely place – its own shareholders. Some of the company’s stakeholders moved a proposal to probe alleged biases in Meta’s India operations and sought an assessment of the same. 

While the proposal was eventually vetoed, this added a new dimension to the already reported allegations that Meta favoured the ruling party. 

Meta’s Sob Story Of Leadership Exodus & Layoffs 

One of the biggest issues that gripped Meta India during the year was layoffs, as the company reportedly fired 400-450 employees in the country.

Even senior executives were not spared by the company as part of its restructuring drive. The company’s director of marketing, Avinash Pant, and director and head of media partnerships, Saket Jha Saurabh, were unceremoniously shown the exits as part of the exercise.

Curiously, just before the layoffs commenced, director and head of partnerships, Manish Chopra, put in his papers.

Meta Ramps Up India Push

Amid all these, the company undertook a slew of new launches in the country as it began to vociferously monetise its offerings. Following the footsteps of its peer X (formerly Twitter), Meta began rolling out its ‘Meta Verified’ service in India in June 2023 to build alternative revenue streams in the country.

It also announced a slew of business-focussed features on WhatsApp to tap into the B2B ecosystem.

On the financial front, Meta India continued to witness healthy growth, although the economic downturn slowed down the momentum. The Indian arm of social media major, Facebook India Online Services, recorded a net profit of INR 352 Cr in FY23, up 19% year-on-year (YoY), against gross advertisement revenue of INR 18,308 Cr, up 13% YoY.

To fuel its operations and build goodwill with the Centre, the company also announced several partnerships and accelerator initiatives with the government to mentor Indian startups, especially in emerging areas such as mixed and extended reality.

Meta In 2024: Gazing Into The Crystal Ball

With more digital laws expected to be promulgated in India in 2024, the company could be headed down a rough road as it looks to balance growth with regulations.

“If GDPR (General Data Protection Regulation) repercussions are anything to go by, India and Indian laws might have similar implications for Meta.  A case in point being the DPDP Act which, just like GDPR, has a requirement on the use of data from minors. Given that there are roughly 500 Mn Indians below the age of 18, it opens up a lot of exposure for Meta if they’re not compliant with the new law,” added IDfy’s Ashok Hariharan.

Meanwhile, emerging challenges such as GenAI could put a spanner in the works for the company even as compliance demands surge from authorities.

Notwithstanding this, India continues to be one of the biggest markets for Meta globally, accounting for more than 1 Bn users across three apps — Facebook, Instagram and WhatsApp. 

Walking on a regulatory tightrope in India, Meta’s India journey so far this year has been both bitter and sweet. Now, with global headwinds expected to ease and consumption likely to surge next year, Meta could put its Indian ambitions in full throttle in 2024.