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Meta is facing increasing scrutiny in India, particularly concerning its WhatsApp application, following a court filing that disclosed a potential requirement for the tech giant to adhere to an antitrust ruling. This ruling prevents WhatsApp from sharing user information with Meta for advertising purposes. The directive was issued by the Competition Commission of India (CCI) in November 2023, which accused Meta of broadening its data collection and sharing operations to secure an unfair edge over its competitors. The CCI accused Meta of abusing its dominant position in the market and coercing WhatsApp users into consenting to a controversial privacy policy set forth in 2021.
As per the ruling handed down by the CCI, the company faces a hefty penalty of $24.5 million and will not be permitted to share data between WhatsApp and Meta for a duration of five years. This regulatory decision could dramatically influence Meta’s business dealings in India, a crucial market where the company boasts approximately 350 million Facebook users and over 500 million WhatsApp users.
In response to this ruling, Meta is launching an appeal, arguing that the ruling threatens its ability to present tailored advertising on its platforms, particularly Facebook and Instagram. In the legal documents submitted, Meta emphasizes that the prohibition on data sharing will negatively impact its capability to deliver targeted ads derived from WhatsApp interactions. A specific example provided involves a business engagement where a company might discuss a product with a customer on WhatsApp; access to that data would significantly enhance ad targeting capabilities. Additionally, if Meta conforms to the CCI’s stipulations, it may be forced to retract or suspend various features presently offered in WhatsApp.
The tech firm asserts that the antitrust monitoring body did not engage with Meta prior to promulgating such a significant directive. Meta also challenged the CCI’s comprehension of the intricate technical nature of WhatsApp’s privacy features and the potential ramifications these changes could have on its overall service delivery.
The controversy emerged when WhatsApp updated its privacy policy in 2021, prompting users to consent to new conditions that allowed Meta to share increased amounts of data. The CCI argued that WhatsApp infringed upon Indian competition laws by ostensibly coercing users into accepting these new terms without providing an adequate opt-out option.
Presently, Meta is focusing on appealing the CCI’s ruling in a designated Indian tribunal, while simultaneously defending its policy updates. Although the process may extend over several months before resolution is reached, the tribunal has the authority to temporarily suspend the CCI’s ruling while the appeal proceeds. Meta’s request for a stay on the CCI’s ruling is anticipated to be reviewed this week.
