India: Competition Commission Of India Negates Challenge To WhatsApp Contravening Provisions Of Section 4 Of The Competition Act, 2002.

The Competition Commission of India (Hereafter "CCI"), in the matter of Shri Vinod Gupta v. WhatsApp Inc.1 negated a challenge made under section 19(1)(a)2 of the Competition Act, 2002, (Hereafter the "Act") against WhatsApp Inc. (Hereafter "WhatsApp,") alleging contravention of Section 43 of the Act.4

The Informant, Mr. Vinod Gupta, filed an information, under section 19(1)(a) of the Act, alleging that about 95% of smart phones in India have WhatsApp installed, and with more than 70 million users,5 WhatsApp holds a substantial market share, which has further increased from 450 million to 1 billion, due to WhatsApp decision to dispense charging fees from its users.6

The Informant's grievance was that WhatsApp on being acquired by the Facebook on 19.02.2014, changed its privacy policy in August, 2016, as per which WhatsApp is sharing its data with Facebook, which is thereafter used by the latter for targeted advertisements.7 The informant alleged that the new privacy policy enables copying, downloading, and extracting of the database, and other information for the commercial benefits of WhatsApp/Facebook in violation of the provisions of the Information Technology Act, 2000.8

The Informant therefore prayed for prohibiting WhatsApp from; i) sharing users' information with Facebook; and ii) a direction to WhatsApp, not to discontinue its services to users, who did not opt for the change in the privacy policy.9

Per Contra WhatsApp contended that all types of messages, and calls made through WhatsApp are protected by end to end encryption, thereby making the same immune from being read either by the third parties, or even WhatsApp itself, except for the intended recipient.10

CCI Finds WhatsApp Is In Dominant Position In The Relevant Market11;

The CCI apart from cited sources, relied on information available in public domain, and noted that a number of other players such as Apple with iMessage, Blackberry with BBM, Samsung with ChatOn, Google with Google Hangouts, and Micosoft with Skype provide consumer communication apps, and other communication apps such as Hike, Viber, We Chat are also active in the market. However, WhatsApp within India has 160 million monthly active users, with 97% of the smart phone users in the country using some communication apps daily of which the most popular is WhatsApp, being installed on 96% of devices i.e. 2.3 times more devices than other messaging applications,12 and 56%, and 51% of internet users in India use WhatsApp, and Facebook respectively,13 therefore WhatsApp is in the dominant position in the relevant market.14

CCI Finds Allegations Of Breach Of The Information Technology Act , 2002, Do Not Fall Within The Ambit Of The Competition Act ;

The CCI noted that the WhatsApp privacy policy had been updated in relation to the sharing of users' data, and information with Facebook (including with "Facebook Family of Companies,") for the purpose of improving infrastructure, delivery systems, securing system, online advertisements, and product experiences available to the users on their Facebook pages, fighting spams, abuse, and infringements.15 Additionally, WhatsApp also provides the users with an option to opt out of sharing information with Facebook within 30 days of agreeing to the updated terms of service, and privacy policy.16 The CCI also accepted WhatsApp's submission that all messages, and calls are protected by end-to-end encryption so that the third parties, and even WhatsApp itself cannot read them, and the messages can only be decrypted by the intended recipient.17 Additionally, CCI also noted that nothing that a user shares on WhatsApp is shared on Facebook, or any other apps of "Facebook Family of Companies," for an third party to see.18

The CCI relied upon the judgment of Hon'ble Delhi High court in Karmanya Singh Sareen & ors v. Union of India & ors,19 wherein it had been inter alia held that it was open to existing users of WhatsApp, who did not want their information to be shared on Facebook, to opt for deletion of their account.20 In these circumstances, the CCI observed that the examination of the allegations of the breach of the Information Technology Act, 2002, did not fall within the ambit of the Act.21

CCI Finds What sApp Is Not Indulging in Predatory Pricing;

The allegation that WhatsApp is indulging in predatory pricing was negated for the following reasons; i) the standard practice in the market is to provide services without charging the users (as a matter of fact, apart from WhatsApp, good many other apps like Hike, messenger, etc also do not levy any charge);22 ii) the revenue model of WhatsApp is similar to other competitors in the market;23 iii) users can shift from one communication app to another without incurring any costs since;24 (a) all consumer communication apps are either free of cost, or minimally priced;25 (b) all consumer communication apps are easily downloadable on smart phones, and can co-exist on the same handset without taxing much system capacity;26 (c) once consumer communication apps are installed on a device, users can change its competitor apps for e.g. uninstalling, or otherwise deactivating the similar apps;27 (d) the user interfaces of all such consumer communication apps being simplistic, the costs of switching to a new app are minimalistic;28 and (e) information about new apps is easily accessible because of the number of reviews of consumer communication apps on apps store. There being no significant barriers for the entry of new communication apps, and the consumers being price sensitive.29

In the light of aforesaid, the CCI closed the information under section 26(2)30 of the Act, observing that while the WhatsApp is in a dominant position, nevertheless it has not resorted to any predatory pricing, and thus not flouted the provisions of Section 4 of the Act.


1 MANU/CO/0036/2017.

2 19. (1) The Commission may inquire into any alleged contravention of the provisions contained in subsection (1) of section 3 or sub-section (1) of section 4 either on its own motion or on— (a) 29[receipt of any information, in such manner and] accompanied by such fee as may be determined by regulations, from any person, consumer or their association or trade association; or

3 Section 4 prohibits abuse of dominant position

4 Ibid., at p. 6, Para 20.

5 Ibid., at p. 1, Para 4.

6 Ibid., at p. 2, Para 5.

7 Ibid., at p. 2, Para 9.

8 Ibid., at p. 2, Para 6.

9 Ibid., at p. 2, Para 7.

10 Ibid., at p. 4, Para 15.

11 Qua the "relevant product market," the CCI, in para 11 noted that Whatsapp was unlike the traditional electronic communication(s) such as text messaging, voice calls etc. since it was an instant communication application, which provides a platform for communication through texting, group chats, voice, and video calls using the internet, and other functionalities. Additionally, the CCI also noted that whereas the traditional electronic communication services could be used through any mobile phone, the instant communication apps could only be used through Smart phones. Furthermore, the CCI noted the while the Whatsapp didn't charge any fee from its users, which was no so in case of traditional communication services. Lastly, the instant messaging services require the users to use the same communication application platform, whereas the traditional electronic communication could be effected between people who did not use the mobile service of the same provider. In this view of the matter, the CCI held that the relevant product market in the case could be considered as "the market for instant messaging services using consumer communications Apps through smart phones." (Emphasis supplied).

Qua the "relevant geographic market," the CCI, in para 12 noted that the functionality provided by consumer communication apps through smart phones was inherently cross-border, with consumers free to install any app they want, without any geographical limitations, and the functionality of apps differing from either region to region or country to country either in terms of price fluctuations, functionalities, platforms, or operating systems. However, in view of the fact that the allegations of the informant pertained to "anti-competitive" conduct of WhatsApp view of the fact that the allegations of the informant pertained to "anti-competitive" conduct of WhatsApp within the geographic boundary of India, and the competition conditions for instant messaging services using such apps through smart phones was homogenous throughout the country, hence the geographic area of India was considered to be the relevant geographic area. (Emphasis supplied).

Having considered the relevant product market, & relevant geographic market, the CCI was of the view that the relevant market, in the facts of the case, may be considered as "the market for instant messaging services using consumer communications applications through smart phones in India"

12 Ibid., at p. 4, Para 14 relying upon Jana and mCent.

13 Id., relying upon TNS/TNC Connected Life Study, 2015.

14 Ibid., at p. 4, Para 14.

15 Ibid., at p. 4, Para 15.

16 Id.

17 Id.

18 Id.

19 233 (2016) DLT 456 (DB) = MANU/DE/2607/2016. The Hon'ble DB inter alia opined that the legal position regarding the existence of the fundamental right to privacy is yet to be authoritatively decided (referring to K.S. Puttaswamy (Retired) and Anr. v. Union of India. (2015) 8 SCC 735). The three judge bench in K.S. Puttaswamy had referred the matter to a larger bench, and the reference is currently pending adjudication.

20 Ibid., at p. 5, Para 17.

21 Id.

22 Ibid., at p. 5, Para 19.

23 Id.

24 Id.

25 Id.

26 Id.

27 Id.

28 Id.

29 Id.

30 Section 26(2) reads "Where on receipt of a reference from the Central Government or a State Government or a statutory authority or information received under section 19, the Commission is of the opinion that there exists no prima facie case, it shall close the matter forthwith and pass such orders as it deems fit and send a copy of its order to the Central Government or the State Government or the statutory authority or the parties concerned, as the case may be."

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

In association with
Related Topics
Related Articles
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of

To Use you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions