Meta Faces Regulatory Hurdle in India: Antitrust Ruling Threatens Features and Business2 min read
Meta, the parent company of social media giants like Facebook, Instagram WhatsApp, has warned that it may need to “roll back or pause” certain features in India following an antitrust ruling that prohibits WhatsApp from sharing user data with Meta for advertising purposes. This development stems from a November directive by the Competition Commission of India (CCI), which accused the U.S.-based company of abusing its market dominance and coercing users into accepting a 2021 privacy policy reportedly.
The CCI imposed a $24.5 million fine and a five-year ban on WhatsApp’s data-sharing practices in India, Meta’s largest market for both Facebook & WhatsApp (Facebook with 350M and WhatsApp with 500M users).
The decision has prompted Meta to file an appeal with the Indian tribunal, criticizing the CCI’s handling of the matter and expressing concerns over the impact on its business.
In a detailed filing, spanning nearly 2,000 pages and reviewed by Reuters, Meta outlined the potential consequences of the data-sharing ban. The company argued that restricting WhatsApp from sharing user data with Meta would undermine its ability to provide personalized advertisements on Facebook and Instagram. For example, an Indian fashion business might no longer be able to target ads on Facebook or Instagram based on a customer’s interaction with them via WhatsApp.
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Meta’s Indian advertising arm, Facebook India Online Services, reported revenue of $351 million for the fiscal year 2023-24, its highest in five years, highlighting the significant stakes involved in this case.
Meta has publicly defended the 2021 privacy policy changes, claiming they were meant to explain optional business messaging features and did not expand data collection or sharing capabilities.
However, the CCI concluded otherwise, stating that the policy pressured users to consent without offering an opt-out option, forcing them to accept the terms or risk losing access to WhatsApp.
In its ruling, the CCI mandated that WhatsApp must now provide users with the option to decide whether their data can be shared with Meta. Meta, in its tribunal filing, criticized the CCI for failing to consult the company before issuing directives that significantly impact its business practices.
The antitrust challenge in India adds to Meta’s ongoing regulatory battles worldwide. In 2021, WhatsApp faced criticism in the European Union for allegedly violating privacy laws by not presenting policy changes in clear and comprehensible language. The company eventually agreed to clarify the changes for EU users.
The Indian appeals tribunal is set to hear Meta’s plea on Thursday. While the case could extend for weeks or months, the tribunal may temporarily suspend the CCI’s directive. Both Meta and the CCI have declined to comment on the matter.
As Meta navigates the complexities of regulatory compliance in one of its most significant markets, the outcome of this case will likely set a precedent for how antitrust laws are applied to global tech giants operating in India.
For more updates, be with Markedium.
