By AMOL SHARMA
NEW DELHI?Google Inc. and Facebook Inc. are set to begin trial here Tuesday to face charges that they didn't censor objectionable content from their sites, putting on stark display the legal risks for Internet companies chasing growth in India.
Google and Facebook are scheduled to stand trial in New Delhi starting Tuesday on charges they failed to censor objectionable content, marking India's most prominent effort to regulate Web content. Dennis Berman has details on The News Hub. Photo: AP
The case is the highest-stakes example yet of the controversy in India over what role Internet companies should have in policing content on the Web. If convicted, executives from the companies could face jail time and the companies could face fines, lawyers following the case said.
The trial comes as Google and Facebook see India as an important growth market. Facebook, which faces heavy restrictions in China, said in a recent filing for its planned U.S. initial public offering that India is among its most significant sources of growth. The company said it had 46 million monthly active users in India at the end of last year, up 132% from a year earlier.
The opportunity in coming years looks promising, because less than 10% of India's population of 1.2 billion is online, according to the Internet and Mobile Association of India trade group. A Google executive said last year that the company expects India's Web user base to grow by 200 million people to reach at least 300 million by 2014, largely driven by increased Internet use on mobile phones.
India hasn't pursued website-blocking as aggressively as China, Iran or Syria have. But New Delhi has regulated a range of content, including political satire and material that could offend religious groups. Under regulations India put in place last year, Internet companies are supposed to remove within 36 hours of being notified material that falls into a range of categories?for example, anything "ethnically objectionable," "grossly harmful," "defamatory" or "blasphemous."
The criminal complaint filed by Indian journalist Vinay Rai alleges that 12 services, including Facebook, Google's YouTube video site and Orkut social network, and several smaller Indian sites hosted material that "seeks to create enmity, hatred and communal violence" and "will corrupt minds." The complaint refers to obscene content and material that depicted Hindu, Muslim and Christian religious figures in a mocking or offensive manner.
Civil-liberties advocates have blasted the case as a crackdown on free speech.
Google and Facebook have argued that India's information-technology law protects them from liability for content posted by users. The companies acknowledged they have a responsibility to remove content, in some cases, but only if notified about it.
The companies have argued that monitoring their services without receiving complaints wouldn't be feasible, given the amounts of traffic on their sites, and would stifle free speech. Mr. Rai didn't flag directly to the companies any of the content he found objectionable, complaining instead to the government.
Google and Facebook have petitioned the Delhi High Court to quash the case but the hearing isn't until early May. Both companies declined to comment for this article.
"Internet companies have to follow the local laws of the land," said Sandeep Aggarwal, a former Silicon Valley research analyst who recently started the Indian e-commerce site ShopClues.com. "But India can't afford to send a message that unreasonable censorship of the Internet has started." He predicted that India's nascent Internet industry could generate 1.5 million jobs and $45 billion in wealth for investors in the next few years if companies aren't bogged down in litigation.
Bloomberg NewsLess than 10% of India's population of 1.2 billion is online. Here, an Internet cafe in Mumbai last year.
Stepped-up regulation of social networking is seen as a particular threat to India's Web growth. "The biggest driver of Internet adoption in India is clearly social networking. It would be a major damper to see it restricted in a serious way," said Kunal Bajaj, head of India operations for technology consulting firm Analysys Mason.
The specific material Mr. Rai complained about hasn't been disclosed, but Internet companies in India routinely get requests from authorities and users to remove content. Last year, Google removed a YouTube video related to an ancient Hindu epic that had been edited to include foul language, according to a lawyer who has represented the company. A few months ago, the telecommunications ministry complained to Internet companies about an online photo that superimposed Congress Party President Sonia Gandhi's image on the body of a scantily clad Bollywood actress.
The case also names Microsoft Corp. as a defendant, but lawyers following the case said the company isn't a focus because most of the controversial content was on Google's and Facebook's sites. Microsoft has petitioned to be removed from the case, saying there is "no cause of action against Microsoft," a company representative said by email. "We are committed to growing the Indian market and working in tandem with the government and industry."
Yahoo Inc. petitioned successfully to be removed from the case.
Tuesday's action, at New Delhi's Patiala House, will be largely procedural, and executives from Google and Facebook aren't required to attend.
Google has since removed most of the content to which Mr. Rai objected. The company's general policy is to remove material that violates its terms of usage or the laws of the countries in which it operates. Between January and June of last year, Google received government requests in India to remove 358 items and complied a little more than half the time, according to the company's Transparency Report.
It wasn't clear whether Facebook had removed the content referred to in the case.
The case is hardly the only challenge for the Internet companies as they try to capitalize on India's Internet growth. The also need to attract marketers to spend money online.
Digital ad spending reached $291 million in India last year, compared with $7.4 billion in China and $32.2 billion in the U.S., according to media-buying company Group M. TV and newspapers in India receive more than 80% of ad spending, while digital services get less than 5%.
The Web companies also face a civil lawsuit filed by a citizen, with almost identical accusations to the criminal case, and pressure from the telecommunications ministry to monitor their sites proactively, with an eye toward removing offensive content.
The telecom ministry didn't respond to a request for comment. Milind Deora, minister of state for communications and information technology, said in a January interview that India "does not want to get into the business of censoring any media. We can't do it, and we don't want to."
Write to Amol Sharma at amol.sharma@wsj.com
Printed in The Wall Street Journal, page B1A version of this article appeared Mar. 13, 2012, on page B1 in some U.S. editions of The Wall Street Journal, with the headline: Google, Facebook Fight India Censors.
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