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Against the backdrop of increasing government oversight and inadequate monetisation plans, WhatsApp is staring at an identity crisis.
And as the company saunters into its 11th year, the dilemma it faces could very well rock the foundation it was built on. More than a decade ago, WhatsApp took India, where SMS was mainstream, by storm. Powered by unlimited real-time exchange of messages, it quickly built a 250 million user base. “It is easy to use. Over the years, it has slowly built a list of features and has seen good adoption,” said Gaurav Mendiratta, CEO, SocioSquares, a digital marketing firm.
But now WhatsApp faces a dilemma: should it say yes/accede to the government’s proposed changes/demands including traceability of messages and compromise on its encryption policy?
In many ways, it is ironic that the issue has cropped up after five years. It was in 2013 that Blackberry, after many years of constant jabbing with the Indian government, relented and allowed it to intercept data sent over its devices. However, WhatsApp works on different devices. The end-to-end encryption it offers by default means only the sender and the recipient can see the messages.
Privacy concerns
It is in this context that many in the industry question whether such traceability is possible, technology-wise, while also considering that the Indian Constitution states that privacy is a fundamental right.
“It may not be possible for them to comply with this regulation without breaking the encryption which would have major impact on privacy of an individual,” said Siddharth Mahajan, Partner, Athena Legal, a law firm.
WhatsApp has 1.5 billion monthly active users globally. In an election year, platforms such as WhatsApp and Facebook will be looked upon to take steps to curb the spread of fake news, ensure customers are not spammed by marketers and give users more control over receiving messages, stated Anil Joshi, Managing Partner, Unicorn India Ventures.
In other words, if WhatsApp relents and agrees to the government’s demand, it will lose the trust of people. If it does not, it risks losing access to the biggest market where there are 550 million internet users and smartphone usage is bursting at the seams.
So far, the company seems to have stuck to its guns. When WhatsApp co-founder Brian Acton, left Facebook, the disagreement was reportedly over how to monetise the ‘anti-ads’ messaging platform.
Growing competition
What could mark a techtonic shift for WhatsApp is its payments feature, which enables person-to-person payments. “With its 250 million monthly active user base, in a low-margin business of payments, WhatsApp can compensate with volumes,” said Rajiv Ranjan, founder, PaisaDukan.
Meanwhile, competition is snapping at its heels, even though they are much smaller in size. Telegram, a secure chat app, is used by UPSC as well as NEET students, and claims to have around 40 million users. ShareChat, a vernacular social media platform, with 30 million users, has rolled out messaging services.
In light of all this, no matter whether WhatsApp loosens encryption or builds on its advertising, it will definitely not be the messenger service that it started out with a simple chat feature.
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