NEW DELHI: In its first action of this kind against a social media platform, Competition Commission of India (CCI) on Monday ordered WhatsApp to stop sharing user data with other companies within the fold of its parent Meta, which has been slapped a fine of Rs 213 crore for abusing its “dominant position” following changes to the messaging platform’s privacy policy in 2021.
WhatsApp, which can challenge the order, has been directed to change its policies and ensure users are given the choice to opt out of the datasharing arrangement. It has also been asked to give users an option — through a prominent tab — to review and modify their choice.
“The commission has concluded the 2021 policy update by WhatsApp on a ‘take-it-or-leave-it’ basis constitutes an imposition of unfair condition under the (Competition) Act, as it compels all users to accept expanded data collection terms & sharing of data within Meta Group without any opt out,” CCI said in a statement.
Meta flouting law to protect hold over online ad market: CCI
Three years ago, WhatsApp, the dominant player among over-the-top (OTT) messaging platforms in the country, changed its 2016 policy on sharing data with Facebook, and removed the earlier option to opt out.
CCI said that the updated privacy policy was an abuse of dominant position by Meta, given its network effects, and lack of effective alternatives.
It also said that sharing of WhatsApp user data by the social media giant — whose offerings include the hugely popular Facebook and Instagram — for purposes other than providing the messaging platform’s services created an entry barrier for rivals, denying them access to the market for display advertisements.
Over the years, WhatsApp has argued that messages on its platform were encrypted and it denied access to govts even in cases of crises or law and order situations, but the CCI probe indicates that certain user information was being used to throw up ads while using Facebook.
The watchdog concluded further violations of the Competition Act as Meta was leveraging its dominant position among OTT messaging apps through smartphones to protect its hold over the online display advertising market.
Earlier, CCI imposed penalty on Google in two cases, Rs 1,300 crore related to anti-competitive practices related to Android phones & Rs 936 crore for Play Store-related policies.