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TMI Blog2017 (6) TMI 1399X X X X Extracts X X X X X X X X Extracts X X X X ..... n India use 'WhatsApp' and 51% use 'Facebook' every day. Further, amongst India's internet users, 'WhatsApp' tops the list of instant messaging apps. Further, citing a study conducted by Global Web Index, the Informant has submitted that 64% of mobile users in India use 'WhatsApp' which is the largest as compared to any other mobile messaging app usage. Based on the above, the Commission is of the opinion that the OP is in a dominant position in the relevant market. Abusive conduct of the OP in the relevant market - HELD THAT:- There are no significant costs preventing the users to switch from one consumer communication apps to another. It may be due to the following reasons: (i) all consumer communication apps are offered for free of cost or at a very low price (mostly free), (ii) all consumer communication apps are easily downloadable on smartphones and can co-exist on the same handset (also called 'multi homing') without taking much capacity along with other apps, (iii) once consumer communication apps are installed on a device, users can pass on from one app to its competitor apps in no-time, (iv) consumer communication apps are norma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion of the provisions of Section 4 of the Act. As per the Informant, through the aforesaid conduct, 'WhatsApp' and 'Facebook' have been able to enlarge their user base and recouping profits by using the data base of the users for the purpose of targeted advertisements. 10. In order to arrive at a decision in this matter, it is to be determined is whether the OP has infracted the provisions of Section 4 of the Act. However, determination of the said issue requires delineation of relevant market, assessment of the position of dominance of the OP in the relevant market and examination of the alleged abusive conduct of the OP in terms of Section 4 of the Act in case it is found to be in a dominant position in the relevant market. 11. The Commission notes that as per Section 2(f) of the Act, 'relevant market' means the market which may be determined by the Commission with reference to the 'relevant product market' or the 'relevant geographic market' or with reference to both the markets. In regard to the relevant product market, the Commission notes that 'WhatsApp', an instant communication app for smartphones using standard cellular mobi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ll consumers with access to internet are in principle free to download and install any app they want, irrespective of their geographic location anywhere in the world. However, competitive conditions, regulatory architecture and players may vary in different countries/regions. Since in the present matter, the allegations of the Informant pertain to the alleged anti-competitive conduct of 'Whatsapp' within the geographic boundary of India and the conditions of competition in the market for instant messaging services using consumer communication apps through smartphones is homogeneous throughout India, the Commission is of the view that the geographic area of 'India' may be considered as the relevant geographic market in the instant case. 13. Considering the relevant product market and the relevant geographic market delineated above, the Commission is of the view that relevant market in this case may be considered as 'the market for instant messaging services using consumer communication apps through smartphones in India''. 14. On the issue of dominance of the OP in the relevant market as defined supra, the Commission notes that in India a number of other p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 30 days of agreeing to the updated terms of service and privacy policy. Moreover, the OP has submitted that 'Facebook family of companies' will use such information for the purpose of improving infrastructure and delivery systems, understanding how their services are used, securing systems, and fighting spam, abuse or infringement activities. The Commission also finds force in the submission of the OP regarding its users safeguards that all types of 'WhatsApp' messages (including chats, group chats, images, videos, voice messages and files) and 'WhatsApp' calls are protected by end-to-end encryption so that third parties and 'WhatsApp' cannot read them and also the message can only be decrypted by the recipient. Further, as stated in the key updates summary of the OP, nothing a user shares on 'WhatsApp', including his/her messages, photos, and account information, will be shared onto 'Facebook' or any other apps of 'Facebook family of companies' for any third party to see, and nothing a user posts on those apps will be shared by 'WhatsApp' for any third party to see. 16. The Informant has also alleged that the conduct ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d with 'Facebook' or any one of its group companies. However, against the aforesaid order of the Hon'ble High Court of Delhi, an appeal was preferred before the Hon'ble Supreme Court and the matter is still pending before the Hon'ble Supreme Court. In the above backdrop, the Commission is of the view that the allegations of breach of the IT Act, 2000 do not fall within the purview of examination under the provisions of the Act. 18. Further, the Informant has alleged that by not charging any subscription fee since January, 2016 from its users, the OP is indulging in predatory pricing. In this regard, the Commission observes that there are several other applications available in the relevant market which do not charge any fee from the users for availing their services for instance, Hike, Messenger and Viber are also available for free. It appears to be the standard practice in the industry/business that all consumer communication apps are not charging any fee from the users. The Commission observes that 'WhatsApp' was previously charging subscription fee from its users which was subsequently scrapped. This may be due to the presence of many other service p ..... X X X X Extracts X X X X X X X X Extracts X X X X
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