Under the new policy, WhatsApp would share transaction data, device information, IP addresses and more with Facebook
The move is tied to WhatsApp's bigger ecommerce play as well as its super app ambitions in India
Users who do not accept the new privacy policy from February 2021 will no longer be able to access WhatsApp chats or groups
Inc42 Daily Brief
Stay Ahead With Daily News & Analysis on India’s Tech & Startup Economy
In perhaps the biggest change in WhatsApp’s privacy policy in years, the company has stated that it will share more user data with parent company Facebook, particularly related to business transactions on WhatsApp, other activity as well as device-level information from users. The move is tied to WhatsApp’s bigger ecommerce play as well as its super app ambitions in India.
Most worryingly, the users who do not accept the amended privacy policy, which comes into effect from February 08, 2021, will no longer be able to access WhatsApp chats or groups, the company said in in-app prompts shown to multiple users in India.
Despite its end-to-end encryption for chats, WhatsApp collects an enormous amount of metadata from users, which will be freely shared with Facebook, as part of the larger vision to connect various parts of Facebook, as stated by Facebook chief Mark Zuckerberg in 2019.
What Data Will WhatsApp Collect?
Under the new terms and conditions, WhatsApp would share transaction data, mobile device information, IP addresses, and other data on how users interacted with businesses with Facebook group companies, including Instagram.
The company already collects device, connection, and location information automatically. Moreover, WhatsApp will collect location info, even when location settings have been turned off, using multiple indicators. Besides this, it will automatically collect device and usage log, which indicates WhatsApp status, chat groups and profile photo.
The new policy primarily targets business interactions, transactions and other business-related features, which are said to allow WhatsApp and Facebook to support third-party service providers in a better way and provide advanced features such as analytics and more. The move is part of WhatsApp’s plan to become an ecommerce platform of sorts for small merchants and digital service providers.
The Focus On Businesses
In December 2020, WhatsApp introduced ‘carts’ to make online shopping easier for consumers by buying multiple items from a seller. As with any other ecommerce experience, WhatsApp lets users add items to the cart and send an order request to the business. “WhatsApp is fast becoming a store counter to discuss products and coordinate sales. Catalogs have allowed people to quickly see what’s available and helped businesses organise their chats around particular items. With more and more shopping happening through chats, we want to make buying and selling even easier,” the company had said at the time.
This is claimed to aid personalisation of content and displaying relevant ads across other Facebook-owned properties. Facebook also plans to interlink these features with Facebook Pay internationally for service parity.
“As part of WhatsApp’s business vision in October 2020, in order to enable small businesses better, we are updating our terms of service and privacy policy as we work to make WhatsApp a great way to get answers or help from a business,” a WhatsApp spokesperson was quoted as saying in ET.
For WhatsApp, users shopping through its platform would mean an opportunity to drive up payments through its newly-launched payments application WhatsApp Pay. WhatsApp Business already facilitates the social commerce model for multiple Indian startups which aim to leverage the community-driven reselling model to gain sales.
Several Indian ecommerce startups are leveraging WhatsApp’s reach to realise their social commerce ambitions. For instance, Jaipur-based online grocery startup DealShare is reported to have created more than 100 WhatsApp groups with 15,000 customers to inform them about deals and offers. Other social commerce startups such as Bengaluru-based Meesho also rely heavily on WhatsApp to power its reselling model.
Correction note (January 07, 2021 | 1:45 PM): An earlier version of this story had mentioned the incorrect date related to the WhatsApp privacy policy. The text has been update to reflect the correct date. We deeply regret the error.
Note: We at Inc42 take our ethics very seriously. More information about it can be found here.