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Another Thing Andreessen Got Wrong on India: It's the Techies Who Are Against Facebook

Why Indian startups are ticked at Zuck (and Andreessen even more).

Uriel Sinai | Getty Images

On Monday, Facebook’s mobile service for emerging markets, Free Basics, was banned in India for violating net neutrality. On Tuesday, Facebook board member Marc Andreessen leapt to its defense — a plodding attempt that has produced a miniature continent-spanning controversy, a series of apologies and a rare condemnation from Facebook CEO Mark Zuckerberg.

It also did something else: It brushed over the issue’s complications in India.

Andreessen’s point, one reiterated by others in his venture capital firm on Twitter, is that the benefits from Facebook’s Internet access program — a telecom partnership that subsidizes data costs for Facebook and other apps — outweighs any costs. The Valley investors framed the opposition to it as “ideological,” equating the critics with India’s historically anti-free-market government.

But they missed the point. The opposition is from the techies. In actuality, a bulk of the effective resistance to Facebook’s Free Basics came from a wide swath of Indian industry and politics, including plenty of tech entrepreneurs and boosters.

“Many Indian startups see Free Basics as a threat to a level playing field and fear that it could lead to distortions and cronyism,” said Sumanth Raghavendra, founder of mobile startup Deck in Bangalore. Raghavendra also wrote a rebuttal to Andreessen on (where else) Medium laying out his opposition. (It’s worth reading if you want to dig into the fascinating weeds here.)

He’s not alone. Last month, 854 Indian startup founders signed a letter to the prime minister warning that differential mobile pricing — the mechanism behind Free Basics — would hamper innovation in the country.

Facebook’s earlier version of the service, called Internet.org, picked select apps to be involved. After a backlash, Facebook ditched that model and introduced Free Basics, which is open to any app.

But the Indian tech opposition still sees this model, which cuts mobile costs for certain services, as insidious. The letter signed by the Indian founders reads:

The most detrimental impact of a differential pricing regime would be on our citizens, who will not get access to the best solutions that the country’s entrepreneurs will devise for them. Moreover, it will have a domino effect on the performance of our nation’s startup ecosystem and therefore on our potential for economic growth.

Several in India are also put off by the reported amount Facebook spent to advertise the service. They found Andreessen et al’s comments dubious because they painted Facebook’s efforts as philanthropic, rather than a user acquisition strategy. “Many of us were also insulted that they would think we’re so glib to swallow this,” said one Indian startup founder.

Opposition has come from several corners of Indian tech. Vijay Shekhar Sharma, CEO of commerce startup Paytm (and a lionized entrepreneur in India), has been another fierce Free Basics detractor. His company even ran ads against the service.

https://twitter.com/vijayshekhar/status/691483312703954944?lang=en

Mahesh Murthy, one of the most vocal critics of Facebook’s initiative, is a prominent investor in the country. Many key tech trade associations in the country — such as Nasscom, the Internet Council and the Internet and Mobile Association of India — have backed the government’s decision.

And consider Nandan Nilekani, one of the founders of Infosys, the first Indian company to be listed on the Nasdaq, and a business luminary in the country. (Remember when Tom Friedman wrote “it’s a flat world”? Nilekani told him that.) He applauded the TRAI ruling:

https://twitter.com/NandanNilekani/status/696706389532504064

That being said, there are several in India who support Facebook’s initiative. And some who disagree with it make the compelling case that the banning ruling over-regulates.

Still, it’s evident that the opposition is not just conservative, anti-tech government regulators. Much of it comes from the very companies, developers and engineers that Facebook will probably need to expand growth in its potential largest market. That could be why Zuckerberg found the diatribes against them so “deeply upsetting.”

This article originally appeared on Recode.net.

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