We don’t know what could be the reason, but the WSJ report suggested that Facebook has deleted the Ads code and disbanded the team tasked with WhatsApp Ads.
Facebook’s challenges with managing WhatsApp are not new or unknown. Ever since acquiring the popular chatting app for $19 billion, the social network has been facing a challenge of monetization: How to make money through WhatsApp.
This acquisition was costly, and despite growing the user-base by over four times, the company has not been able to figure out a way to make money out of it. From a business perspective, this makes total sense as to what’s the point of owning or acquiring a platform if you can’t make money out of it.
At Facebook, the discussion around WhatsApp’s future vision and use-cases has not been easy. Going by media reports and a series of events, we believe that (WhatsApp’s co-founder) Brian Acton’s exit from Facebook was primarily driven by the conflicting views on the future roadmap.
(For those who do not know, Brian is also the co-founder of Signal Foundation that owns and runs Signal App.)
The Popular Hypothesis
While running ads was an obvious point of discussion in Jan 2020, it was not the only option. Another popular (monetization) use-case was WhatsApp Payment, which has already been rolled out in countries like Brazil and India last year.
In these markets, the chatting app works as a popular customer-service tool, making sense to integrate payment into the same. Facebook charges fees in line with industry standards, where peer-to-peer is free, whereas it charges 3.99% to businesses for receiving payment from customers.
Why Am I Telling You This?
(Sorry for the long introduction; but it was vital to give you the background of what happened in recent weeks.)
So, what is this all about?
If Facebook had a decent track record of handling user-data, this entire controversy would not have attracted this much attention.
Rings alarm bells, right?
Going through social media and some news portals, I could come across the following key concerns. (Do let me know if I miss anything here)
- WhatsApp reads my messages/chat and shares with Facebook.
- WhatsApp shares my location and other data to third-party services.
- WhatsApp tracks my app usage and records video/audio calls too.
- WhatsApp stores my messages
- WhatsApp can access my financial and sensitive information (and can share too?)
- WhatsApp will share my data with advertisers and show me ads on the app.
Before I share my understanding of the change, I would like to remind you that WhatsApp has two versions: an Individual (P2P) app and WhatsApp for Business. Since the policy update treats both versions differently, I’ll explain the implications for both, in separate sections.
WhatsApp for Individuals
This is about the primary app being used by over 2 billion people worldwide and the following points are related to the chats between WhatsApp individual accounts.
1) WhatsApp Does Not Read or Store Your Messages
Peer-to-Peer communication (WhatsApp communication between individuals) is still end-to-end encrypted, and WhatsApp does not read or record your messages.
However, please note that users can backup their WhatsApp data on third-party services like Google Drive, but that is a users’ choice.
2) WhatsApp Does Not Note or Share Your Location
Most of the time, the location-sharing is between individuals, which is essentially an encrypted communication. If your friend shares her live location with you, that information is protected and not shared with Facebook.
However, WhatsApp can get your (overall) approximate location data from the phone number and IP address and is something that may be shared with Facebook. If you are a Facebook user, too, this is something you are already sharing with Facebook. Nothing new here 🙂
3) WhatsApp Does Not Store Your Data (Content You Share)
4) WhatsApp Ads? Maybe But not Now
This means that this is nothing happening right now, but we cannot say anything about the future. As we have explained in the introduction, Facebook is desperately looking for ways to monetize the app, but its moves are finding traction given the trust issue.
In short, if you use WhatsApp for talking to family and friends, there is no change and you can continue to enjoy encrypted communication. Your chats and shared content is secured (not shared).
WhatsApp for Business
While chats between individual accounts are still private and very much protected, there is something you should know about WhatsApp for Business.
1) Data can be shared and used for advertising!
Companies that use WhatsApp for Business now have the option to store their chats on Facebook’s secure hosting services. This data includes general chat, questions and answers, and purchase receipts. That data can be used to “personalize advertising” on Facebook.
If you are familiar with Facebook advertising, “Audience Insights” enables you to customize your audiences for an ad and select the most relevant group based upon interests, demographics, etc. Your vendor can use this chat there and personalize advertising, but only if they are using its hosting and advertising services.
Facebook suggests that it will add labels to the chats being stored on Facebook’s hosting services.
2) You Could See Facebook Ads based on Shopping Activity!
Facebook is bringing some e-commerce features to WhatsApp for Business, where the vendor can showcase products to customers based upon their interests.
See these examples!
Did it ever happen to you that you visited an e-commerce store (Daraz or Alibaba) searching for a product, and then you started to witness ads of those products on your Facebook?
Or, you followed a few celebrities (showbiz or football) on Instagram, and then your “Explore” and “Hashtags” section is filled with more content and recommendations from the same category?
Websites, apps, and subscription services (like Netflix) track users’ behavior (you like or not) and suggest products and content based upon their interests. The modern subscription economy heavily relies on the “recommendation engine” to deliver a personalized experience.
Facebook is trying to help businesses use their WhatsApp data to tailor their advertisements to the users’ interests and needs in a more effective manner.
What to Do Now?
If you are an active user and also concerned about your data privacy, here three options for users.
1) Stick to WhatsApp P2P Account
The first option is to keep using WhatsApp (peer to peer) app as it continues to remain encrypted and does not share your chats with Facebook or advertisers.
2) Reduce your interaction with WA for Business
While your interaction with WhatsApp for Business can be used to sell you ads on Facebook and Instagram, please look around and see if the vendors you are interacting with can actually do that?
If the vendor is a big business and uses digital/Facebook advertising, please avoid those chats. However, if they’re just a small shop that does not store data on Facebook servers or use Facebook ads, you can chat with those.
Also, if you are in a country like Pakistan, where WhatsApp Payment is not integrated, the chances of sensitive data storing or leak are minimal. However, this is a personal choice based upon your level of comfort and preferences.
3) Migrate to alternatives
The last but not the least option is to use WhatsApp alternatives. As I noted above, Signal is a good choice and offers a decent set of features while promising privacy.
The app is also the product of WhatsApp co-founder who had a different vision for WhatsApp and left Facebook due to the same. He’s also known for #DeleteFacebook campaign after the Cambridge Analytica scandal.
Another popular app is Telegram, which has attracted over 25 million users in just one week.
As a marketing professional who has spent around a decade in the technology industry, I can tell you that ‘online privacy is an illusion’.
Modern digital products use many ML solutions to track users’ behavior to optimize their service and make people addict through digital hooks. Even if they do not share your app usage or behavior with others, they still know a lot about you.
From a pure privacy standpoint, this may sound crazy. But if you think from the ‘personalization’ perspective, this is the only option. You can stop websites/services from tracking your behavior if you know how to use the right web browser and settings. (Can cover in a separate post)
For now, let us hope that more countries come up with data privacy and protection acts like GDPR and make big tech accountable for their practices around users’ data.