Thursday, March 28

Facebook Hikes Legal and Advertising Expenses in India

The social networking giant Facebook has doubled its annual spending on legal and advertising expenses and investment in India, underlying the complexity of challenges it faces from regulators to deal with the enormous amounts of incendiary messages exchanged on its platform.

The Menlo Park-based company is going through one of its toughest years after its image took a drubbing for privacy breaches and data misuse. In India, the government and regulators are watching how the social-media giant is dealing with privacy concerns, especially when the country goes to the polls next year.

For 2017-18, Facebook India’s advertising and promotional spends went up by as much as 122% to Rs 94 crore, while its legal department saw costs shooting up by around 85% to Rs 78 crore.

The local arm of the Menlo Park based-company saw its revenue jumping by more than 50% to Rs 521 crore in the period under review. The legal spends are about 15% of Facebook India’s revenue. 

Market research platform Statista showed Facebook has 294 million users, its largest market globally. The social media giant’s profit went by up 40% to Rs 57 crore at the end of March quarter, showed documents sourced from business research platform Tofler.

Such huge legal spends show how social media giant is working harder to understand its public perception after coming under intense scrutiny from policymakers. With India pressing for data localisation and the government planning to tweak the IT Act, the government would be more empowered while seeking data from social media companies.

With over 294 million users in India, Facebook is a platform that could significantly influence the elections. The company recenly announced the new set of measures that will be in place for verification of political advertisements. The company also plans to schedule an in-person visit to complete the confirmation of the advertiser.