G.P. Mittal ORDER
Order under Section 26(2) of the Competition Act, 2002
1. The present information has been filed by Shri Vinod Kumar Gupta ('Informant') under Section 19(1)(a) of the Competition Act, 2002 (the 'Act') against WhatsApp Inc. ('OP7 'WhatsApp') alleging contravention of the provisions of Section 4 of the Act.
2. The Informant is stated to be a Chartered Accountant and has filed the present information on behalf of Fight for Transparency Society. As per the information, OP is a provider of consumer communication services via a mobile app called 'WhatsApp' which is a proprietary, cross-platform, encrypted instant messaging services for smartphones. It uses internet as a medium to send text messages, documents, images, videos, user location and audio messages to other users of 'WhatsApp' using standard cellular mobile numbers.
3. It is stated that the OP was acquired by Facebook Inc. ('Facebook'), the largest social networking site, on 19th February, 2014 for approximately US$19.3 billion. As per the Informant, the OP had introduced many changes to its privacy policy on 25th August, 2016 whereby the users of 'WhatsApp' have been forced to share their account details and other information with 'Facebook' in order to continue availing the services of 'WhatsApp'.
4. The Informant has submitted that the relevant product market in the instant matter would be 'free messaging app available for various smartphones' and the relevant geographical market would be 'Global'. It is stated that the OP is the most popular messaging app in the world with clear market domination in 109 countries and it is having a market share of 55.6% in the world. It is also stated that in 95% of android smartphone devices in India, 'WhatsApp' has been installed, and with more than 70 million users, the OP holds a substantial market share in India.
5. It is stated that after one year of free trial, the OP started charging US$ 0.99 per annum from its users as subscription fee. However, it is averred that since January, 2016, it has stopped charging any fee, which was its only source of revenue, from its users and is providing free services. As per the Informant, by removing subscription fees, the OP has enlarged its consumer base substantially from 450 million to over 1 billion and it is providing the services by sourcing funds from its parent company i.e. 'Facebook'. Thus, the Informant has alleged that by indulging in the practice of predatory pricing, the OP is abusing its dominant position in the relevant market in contravention of the provisions of Section 4 of the Act.
6. Further, it is alleged that by mandating the users to agree with its terms of service and privacy policy as updated in August, 2016, the OP has been sharing the information/data of its users with 'Facebook' which in turn is being used by 'Facebook' for targeted advertisements. It is alleged that the manner in which the so-called consent is taken by the OP from its users is highly deceptive. It is stated that almost the entire community of users of 'WhatsApp' in India are not equipped to even read, much less comprehend, the consequences of the terms and conditions on the basis of which 'WhatsApp' is pretending to obtain the consent of the users. The Informant has alleged that the new privacy policy of the OP is in contravention of the provisions of Section 4 of the Act. It is also alleged that the new privacy policy of the OP enables it to copy/extract/download the mobile's database and information includ........