The Rise of Fact-checking Platforms Leveraging artificial intelligence and advanced technologies is not only helping these platforms curb misinformation but is helping them scale faster

In March this year, Google said that search trends on misinformation have already recorded an all-time high in India in 2023 (and we're still just in March) which is a clear indication of how much this topic is playing on the minds of Indian users. This rampant spread of fake information has made India a large market for fact-checking businesses today. Some of the platforms in the space include Boom Live, Factly, Newsmeter, SoIndiaEdit, Dfrac, Factcrescend and Youturn.

Large tech organizations and corporates are also today partnering with third-party fact-checking platforms. For instance, Meta is currently working with independent, IFCN-certified fact-checkers who identify, review and rate viral misinformation across Facebook, Instagram and WhatsApp.

"Fighting misinformation is an ever-evolving problem, and Meta can't do it alone. We rely on independent fact-checkers to review and rate the accuracy of stories through original reporting, which may include interviewing primary sources, consulting public data and conducting analyses of media, including photos and video," the company says in its website.

The market and business models

India is a large market for such fact-checking businesses for several reasons. We are a large population of 1.4bn people which in turn means a very large potential for fact-checking. "Currently there is a very small number of fact-checkers. It would be less than 20 and there is clearly space for more," said Padmaja Ruparel Co-founder IAN and Founding partner IAN Fund.

With the increasing data clutter, noise and penetration of the internet, the startups solving for fact-checking are expected to grow leaps and bounds. A study by Reuters reveals 63% of Indians count social media as their primary source of news. "In such scenarios, use cases for such products are numerous like politics, social network, business, sports, entertainment, law enforcement and many more which one may not be able to envision at present," said Brijesh Damodaran, Chief Investment Officer & Co-Founder, Auxano Capital.

The business has broadly 3 stakeholders as customers. Individuals, Businesses and Government. They all require help dealing with the tide of information and the embedded misinformation. Experts say that for the likes of social media players or the portals which offer user-generated content, a plug-in into the mainframe is a business proposition and for other organizations like media a subscription-based business model is being explored. "For the government, a broader segment needs to be explored wherein the web crawlers can verify the data across the internet. For individual customers, the freemium model can be looked into with 'pay as you use' feature," added Damodaran.

Overall, these startups operate in both B2B and B2C models.

• B2B for corporates / institutional fact-checking is imperative to ensure factual information forms the basis of any interaction/decision
• B2C is also critical as there is rampant fact distortion happening on social media like Facebook /WhatsApp/Instagram – almost 65% of Indians have encountered fake news, higher than 57% in the US, as per Microsoft's study of 2019

Investor interest and the rise of vernacular

Fact-checking as a crowdsourcing service is picking up investor interest but yet there are many unexplored territories of use cases that would require government support. Thus as a category creator we do see investors' interest but the models are yet to show expansion of scope & potential of such businesses and prove positive unit economics for attracting investors to invest growth capital.

"Fact-checking partners are largely sitting within media organizations or companies like Meta and Google. These are partners helping the larger group/company help fact-check. Further, the Govt. of India, has circulated a draft policy for fact-checking, through PIB. We haven't seen too many investible opportunities in this space," said Ruparel.

But investors expect the rise of vernacular platforms, which is the need of the hour, to bring in investor interest. Since, we are a country of different languages and diverse cultures, it brings its own complexity of cultural/linguistic/religious check on misinformation. This has led to many regional fact-checking platforms. For instance, NewsMeter is a fact checker primarily focused on the southern States in the country.

Use of AI and other trends

AI and blockchain form the foundation for fact-checking tools. "With the evolution of the industry beginning from crowdsourcing, followed by crowdsourcing + AI, now the industry is finally moving to a fully automated and tech-led model driven by AI," said Damodaran.

Blockchain integration is still at a nascent stage due to the generally limited use of blockchain but as the adoption of blockchain technology increases, the fact-checking solutions, experts say, will become more robust and accurate through the blended usage of both AI & Blockchain.

However, for now, profitability is one of the biggest challenges as the same has not been showcased so far. Besides, solving for global clients has again been restrictive as these tools require government support to unleash their full potential. "At the foundational level, the challenge remains with the digitization of information and real-time updation as there exists a lead time which reduces the efficacy of the tool and lastly, with any piece of information containing multiple data points for validation, the biases will prevail over the assessment of the entire information vis-a-vis individual data points," he added.

"Considering the fact, that there is a tremendous amount of misinformation/disinformation circulated through social media, technology will need to play a critical role for fact-checking. These technologies will need to be increasingly developed as the internet accelerates the speed of distribution. In fact, WhatsApp did create technology to restrict the circulation of content (not more than 5 groups, etc.) but there surely is scope for technology to bring real-time verification of content. This will need some deep technology and expertise, especially to ensure fact-checking from a neutral / non-judgemental perspective," said Ruparel.

With the advent of blockchain technology, the application of these tools is expected to become more accurate but will the business model achieve profitability is something that needs to be seen. Experts feel positioning the business toward social impact may yield higher customer and investor interest and so will higher government support in the developing nations.