CCI terms its privacy policy 'exploitative' - So what's the way out for WhatsApp?

March 24, 2021 ,

Instant messaging platform WhatsApp, which has run into some heavy weather in India of late, has been trying to retain its core functionality  --- end to end encryption for all messages.  

But India is also trying to usher in some new stringent norms for various social media platforms including WhatsApp to help trace "originator of objectionable content". This can't be done without tampering with the encryption protocol.

WhatsApp earlier contentious Privacy Policy tweak had also run afoul of Indian authorities.

Now, India's fair trade regulator, the Competition Commission of India (CCI) has ordered a detailed probe into WhatsApp's new privacy policy and terms of services, saying the firm contravened the provisions of competition laws through its "exploitative and exclusionary conduct" in the garb of policy update.

The CCI has asked its investigation arm, the Director General (DG), to carry out a through probe into the matter. It also asked the DG to submit its probe report within 60 days.

CCI cracks the whip

The order against WhatsApp and its parent company Facebook came after the CCI took suo moto cognisance of the issue following media reports on potential impact of the new privacy policy and terms for WhatsApp users.

That CCI passed this order on its own volition, going by just media reports, can in itself send a strong message to WhatsApp. 

The CCI said that as per WhatsApp's previous privacy policies, existing users had an option to choose whether they wanted to share their WhatsApp data with Facebook. However, the new policy suggests that users have no choice and will have to accept all terms including with respect to sharing of their data across all the information categories with other Facebook companies.

"The Commission is of prima facie opinion that the 'take-it-or-leave-it' nature of privacy policy and terms of service of WhatsApp and the information sharing stipulations mentioned therein, merit a detailed investigation in view of the market position and market power enjoyed by WhatsApp," the CCI said.

The Commission also said that many of the information categories described in the new Privacy Policy as well as Terms of Service (including the FAQs published by WhatsApp) were too broad, vague and unintelligible. 

"Such opacity, vagueness, open-endedness and incomplete disclosures hide the actual data cost that a user incurs for availing WhatsApp services," the CCI added.

In a pertinent observation, the CCI said "there appears to be no justifiable reason as to why users should not have any control or say over cross-product processing of their data by way of voluntary consent, and not as a precondition for availing WhatsApp's services."

India unrelenting against WhatsApp

The tone and tenor of the CCI's order clearly conveys the mood in the government corridors. And not just with the CCI, the Indian government is also coming up with a push-back against WhatsApp new privacy policy in the courts too.

The Ministry of Electronics and Information Technology recently told the Delhi High Court that WhatsApp’s privacy policy violates the Information Technology Rules of 2011 (IT Rules, 2011) and that it should be restrained from implementing the policy until the court decides on its validity under Indian law. 

 WhatsApp, for its part, has been trying to address the concerns of the Indian government. But admittedly, it has been less than successful.

Last heard, its CEO Will Cathcart said that his company had explained its concerns around traceability to the Indian government and will continue doing so in the hope of finding solutions "that don’t touch encryption."

But such a stinging rebuke from the CCI, and an ongoing probe into its privacy policy, WhatsApp is clearly caught in a cleft-stick.

It has very little room for maneuverability. Indian government, it appears, is in no mood to relent.

WhatsApp hoisted on its own petard

But WhatsApp can ill afford to stick to its guns and run the risk of losing out in its biggest market, India --- it has an user base of over 400 million  --- where its competitors like Telegram and Signal, and some desi alternatives have made much headway ever since the privacy policy fiasco.

Responding to the CCI's order, a WhatsApp spokesperson said, "We look forward to engaging with the CCI. WhatsApp remains committed to protecting people's personal communications with end-to-end encryption and providing transparency about how these new optional business features work."

This is classical corporate gobbledygook that is doesn't convey much beyond the known banalities. It is clear now that it cannot have it both the ways.

WhatsApp's moment of reckoning is now. The option in front of it is, ironically, the same as what it presented its users: take it or leave it.

Source: CCI order



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