Daybreak - India's new guidelines to stop fake reviews online are missing an important detail

Episode Date: February 13, 2023

Whether it is to decide where to eat or what to buy, online reviews play important role. But fake reviews are turning out to be quite a menace.To bring them under control, the Indian government released a set of guidelines for e-commerce platforms.But they forgot to mention an important point.Tune in to find out.

Hi, this is Rohan Dharma Kumar. If you've heard any of the Ken's podcasts, you've probably heard me, my interruptions, my analogies, and my contrarian takes on most topics. And you might rightly be wondering why am I interrupting this episode too. It's for a special announcement. For the last few months, I and Sita Raman Ganesh, my colleague and the Ken's deputy editor, have been working on an ambitious new podcast. It's called Intermission.

We want to tell the secret sauce stories of India's greatest companies. Stories of how they were born, how they fought to survive, how they build their organizations and culture, how they manage to innovate and thrive over decades, and most importantly, how they're poised today. To do that, Sita and I have been reading books, poring over reports, going through financial statements, digging up archives, and talking to dozens of people. And if that wasn't enough, we also decided to throw in video into the mix. Yes, you heard that right. Intermission has also had to find its footing in the world of multi-camera shoots in professional studios, laborious editing and extensive post-production.

Sita and I are still reeling from the intensity of our first studio recording. Intermission launches on March 23rd. To get alert, as soon as we release our first video. episode, please follow intermission on Spotify and Apple Podcast or subscribe to the Ken's YouTube channel. You can find all of the links at the ken.com slash I am. With that, back to your episode. How long do you spend reading reviews before you buy something online? And can you tell a real review from a fake one?

Because most of us read online reviews, but some people really go in deep. I know someone who would spend our... hours pouring through them on Amazon before actually making a decision to buy something, and it could be something as cheap as a phone cover. At a time when everything under the sun is available at the touch of our fingers on e-commerce platforms, reviews hold a very important place. Whether it is buying something on Amazon or booking a hotel for a holiday or going out to eat at a restaurant, we rely on reviews by people like you and I to tell us the truth.

Now, obviously, sellers want to show off the best reviews. And then we also have the shady sellers who want to manipulate these reviews. And this is a problem for consumers as well as honest sellers. If you have shopped online, then you know exactly what I'm talking about. It is not hard for anyone to go online and manipulate reviews on most platforms. And this especially because those who run these websites don't really make much of an effort to stop these fake reviews. To give you an example, in 2021, Amazon even admitted in a post that in the previous year,

the company had stopped more than 200 million suspected fake reviews before they were even seen by a customer. That is good, right? Admission is the first step. But unfortunately, that is where it ended. In other words, Amazon just said, we are doing what we can. Now, this is a global issue. governments around the world are looking into it and taking appropriate measures against it. In India too, after receiving scores of such complaints, the government finally took note of what was happening and decided to step in. In November last year, the Ministry of Consumer Affairs put out

a press release announcing the launch of new standards aimed at tackling this issue. Let me read out the headline for you. Center launches framework for safeguarding and protecting consumer interests from fake and deceptive reviews in e-commerce. Now, based on what the document says, the government first plans to start with voluntary moderation and then move to mandatory requirements if the growth of fake reviews continues. The Ken reporter Somajit Saha actually went over the entire document containing the government's guidelines on the matter. He wrote about it in his newsletter and he said that there was one thing that stood out like a sore thumb. The entire document does not contain the words

fake or deceptive. They're not even mentioned once. They're only mentioned in the press release. So today, I will tell you about these new set of guidelines by the government and the areas in which they lack. Welcome to Daybreak, a new podcast from the Ken. I'm your host, Nick Dhaas Sharma, and I don't chase the new cycle. Instead, thrice a week on Monday's, Wednesdays and Fridays, I will come to you with one business story that is worth understanding and worth your time. Today is Monday the 13th of February. Before we get to the Indian government's guidelines, to give you some context, let me tell you a little bit about what other countries are doing. Around the world, governments and organizations have been trying to reduce false internet reviews.

For example, in the US, the Federal Trade Commission filed a lawsuit against Roomster. Roomster is a rental listing platform that allegedly paid for fake reviews and charged consumers seeking affordable housing for access to fake listings. In the UK, too, the Competition and Market Authority has been actively trying to tackle the problem of fake reviews. In 2021, it opened a formal investigation into Amazon and Google over concerns that they had not been doing enough to combat fake reviews on their sites. In Italy, in a historic decision by a court in 2018, the owner of Promo Salento, a trip advisor reviewer, was found guilty of adding fraudulent reviews of hundreds of hospitality firms

in order to boost their visibility on the website. He was fined 8,000 euros and given a nine-month prison sentence. The European Commission 2 back in 2018 came up with the new deal to enhance consumer protection. Now let us briefly go over what the Indian government has come up with. The framework basically is a set of guidelines created by the Bureau of Indian Standards. It is titled Indian Standard 19,000 to 2020 online consumer reviews, principles and requirements for their collection, moderation and publication. And for now, it is only meant to be voluntary for all e-commerce platforms according to the Consumer Affairs Department. But the department has also said that they could be made mandatory later.

It also said that the violation of these standards may be legally considered as an unfair trade practice or violation of consumer rights, which basically means that a consumer may submit such grievances to the National Consumer Helpline or Consumer Commissions of India or the CCPA. The government, however, is not going all the way in. And the explanation for this given by Rohit Kumar Singh, the Consumer Affairs Secretary, is this. And I'm quoting, we do not want to bulldoze the industry. We want to take the standard rule.

We will first see voluntary compliance and then, if the menace continues to grow, we will maybe make it mandatory in the future. End quote. Now, this without doubt, is a great first step. But there is a problem. Next, I tell you about what the government seems to have missed in these guidelines. This document that is supposed to tackle the issue of fake online reviews

has no mention of the words fake or deceptive even once. Only the press release mentions it. And this is something that even the stakeholders and participants who attended the consultations noticed as well. How can the government and other organizations deal with this problem when no one knows what exactly counts as a fake or a false review. The current guidelines are essentially a set of non-exhaustive criteria that talk about aspects that could help in understanding the constituents of what makes for a fake review,

like impersonal consumer experience, undisclosed conflicts of interest, factually incorrect information, defamatory language or the inclusion of marketing materials. But how can you really tell you? if the review is from a person who is being paid to write it. Somajit went over these guidelines in detail a few times over, and he said that they defined who is a consumer, what is a consumer review, and what is a solicited or unsolicited review.

He also spoke to a few stakeholders like a public policy executive from a food tech platform, and this is what that person told him. And I'm quoting, when the guidelines are not categorically stating what a fake review is, how do you expect us to address fake reviews? It is a principal policy challenge. If you're asking me to comply with a certain standard,

then what is that metric going to be? This ambiguity by design is a policy problem. End quote. And what this person said does make sense, right? Because it could become a potential problem for a lot of companies. Now, according to the government, this standard is applicable to any organization that publishes consumer reviews online.

They may be suppliers or sellers of products and services that collect reviews from their own customers. It could also be a third party contracted by the supplier or sellers. It is a standard that is supposed to be applicable to any reviews published online collected by any methodology. Coming up next, apart from this vagueness in the definition of what is a fake review, there are some other concerns regarding the guidelines. The scope of what companies are expected to do according to these government guidelines is also quite wide.

Balaji Krishna Swami, an Amazon India spokesperson who works on public policy for the company, explained it to us. They said, and I'm quoting, there may be instances where certain goods or services are purchased or utilized in the name of one individual only. However, they may be utilized by varied members of the family and the review could be published by another individual who was not the initial bio. Therefore, identifying the veracity and genuineness of such consumers will be a key task. End quote. Krishna Swami also pointed out that currently when a product gets many reviews in a short period of time, the company's systems automatically suppress all except verified purchases. but this preventive measure too can be easily played around.

People can buy a product, not use it and still leave a bad review. The Centre for Policy Research and Governance, which is a think tank based in Delhi, also said that there are many other aspects of these guidelines that are weighed and create room for organisations to be creative too. For example, the guidelines use the phrase problematic language, which it says is a ground on which reverse. reviews can be rejected. But this can be twisted around to suppress negative reviews.

The guidelines also do not specify any time period within which these fake reviews should be removed from the platform. It only states that it needs to be done timely. For now, the guidelines are voluntary and quite a way. But they are definitely a step in the right direction. Daybreak is produced from the Newsroom of the Ken, India's first support. subscriber-focused business news platform. What you're listening to is just a small sample of our subscriber-only offerings. A full subscription unlocks daily long-form feature stories, newsletters,

subscriber-only apps and podcast extras. Head to the ken.com and click on the red subscribe button on the top of the website. I am Snihtha Sharma, your host, and today's episode was edited by my colleague, Rajiv Sien.