WhatsApp Privacy Survey

Better World User Survey on WhatsApp Privacy Policy

by | Jan 29, 2021 | Policy, Privacy

Better World User Survey on WhatsApp's new privacy policy finds that 72% are open to switching to another viable messaging platform.
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Users vent out displeasure, want government to crack whip

WhatsApp Privacy Policy Survey Report

Survey and analysis by Deepak Kumar

There is a thin line that divides respect for privacy and intrusion of privacy. In the age of the digital, this line becomes wavy and fuzzy as well. For big internet companies, the user data that resides behind the line is a gold mine. The more they get of it, the richer they get.

The recent WhatsApp privacy policy changes are just about that. By gaining a right to use and share WhatsApp’s select user data with partners, Facebook aspires to gain an unsurmountable edge in the digital advertising world. It goes without saying that WhatsApp data can help reap rich ad dividends for parent company Facebook. Users are not pleased. In respose to the one-week-long Better World survey concluded recently, a majority of them (67%) want the government to step in some way, as discussed ahead in this report. Notably, these include Business WhatsApp users as well. In fact, by the time of writing this report, various leading media portals had reported that government had written to WhatsApp and asked the company to roll back the proposed privacy-policy changes.

It all started when WhatsApp started sending out notifications to its users to the effect that it had updated its privacy policy and the users could either accept the new policy or quit using WhatsApp by 8 February 2021. Meanwhile, while this report was underway, the deadline was extended by more than three months. Users now have to accept the new privacy policy by 15 May.

WhatsApp’s privacy-policy change and the aftermath

Users’ retort has indeed been quick, sharp, and massive. They poured out their disapprovals in words as well as in actions. Millions of users posted and tweeted their angst against the move and even signed up on alternative messaging apps such as Signal and Telegram. Tesla Founder Elon Musk’s two-word tweet, “Use Signal,” helped drive a switch from WhatsApp, particularly given his following of 41.5 million on Twitter.

The rush to leave WhatsApp was so high that servers of Signal were not able to take the load of new signups. At one point, Signal sent out a tweet, “Verification codes are currently delayed across several providers because so many new people are trying to join Signal right now…Hang in there.”

On 11 January 2021, Facebook’s shares declined 4.01% on a day when Nasdaq slipped just 1.55%. On 12 January, it further declined 2.24% on a day when Nasdaq rose 0.77%. On 14 January, it happened to be at the lowest in more than six months.

Better World ran a quick user survey, where 37% users said they considered the move a serious breach of their privacy, while 45% said they it was not good but they could live with it. Only around 18% said the change didn’t bother them at all. However, some of these 18% users were already using other messaging apps along with WhatsApp.

WhatsApp privacy policy-Graph1

What’s the big deal about privacy in the age of social media?

In the age of social media, many of us have become comfortable sharing our thoughts and views on Facebook. In fact, many people don’t mind sharing sensitive personal information such as location and travel plans not just with friends but also with public at large.

However, when it comes to WhatsApp, the behavior often changes. Many of the users’ chats are peer-to-peer in nature and may not be meant for public viewing or consumption. The same would apply to the other activities they perform on WhatsApp, whether today or in future. These would include the financial and transactional activities performed on the WhatsApp platform.

In a digital living environment, if a Facebook wall may be considered comprising areas of the lobby and the living room, WhatsApp will certainly be akin to the bedroom and beyond.

No wonder, the recent changes in WhatsApp’s privacy policy have created a din that Facebook could not see coming.

In the wake of the user backlash, WhatsApp had to get into a defensive mode, sending out clarifications and explanations. However, a damage had been done by then. In a first reaction, 17% users responded to the Better World survey said they were quitting/had quit WhatsApp for good, while 45% said they would accept the change but start exploring other or additional options. Interestingly, 12% said they were already using another social messaging app. However, a good 26% said they would accept the changes and keep using WhatsApp as before.

WhatsApp privacy policy-Graph2

The myth that users are unaware and don’t care for privacy is broken

Often, as an extension to the assumption that transparency is the hallmark of a digital age, it is argued that privacy is hardly a thing that users care about. The user backlash against WhatsApp’s privacy assumptions easily breaks that myth. It also reminds one of the “Free Basics” event a few years ago. Users had then considered it an attempt to compromise ‘net neutrality,’ and Facebook had to roll the offer back.

The promptness of users in defending their privacy and other rights can easily be evidenced by these two examples. The events also show that users are well aware of the repercussions of any policy change or a new offering in the internet world. This is echoed by this survey results, with 80% users stating they were aware that WhatsApp was changing its privacy policy, and would be sharing a range of user data with Facebook and Instagram platforms with effect from 8 February 2021 (now 15 May 2021). The remaining 20% users said they were not aware of such changes. It is likely that some of these users were yet to receive the notifications regarding policy change when they took this survey.

Further, around 47% of users said they understood the implications of WhatsApp’s new privacy policy for users reasonably well and another 18% said they understood it fully well. By contrast only 29% said they didn’t understand it well enough while another 6% said they didn’t understand it at all. Overall, this implies a high incidence of awareness around WhatsApp’s new privacy policy.

Notably, while the messages will remains end-to-end encrypted, the new policy means sharing a host of user-related information with Facebook and other third-party platforms. These include information about a user’s location, IP address, mobile operator, timezone, phone number, and receipt of a Facebook or WhatsApp account. Additionally, conversations associated with business accounts will now be shared with Facebook.

WhatsApp privacy policy-Graph3

The damage-control measures may be too little too late; more is needed

WhatsApp has issued a number of clarifications and explanations pertaining to the change. Those clarifications, however, have been far from satisfactory. Its parent company Facebook says the new policy changes are directed only at Business WhatsApp accounts and not the individual accounts. Also, it says only certain ad-related information will be shared with Facebook and other group companies.

However, on the actual Privacy Policy page, some of the statements may sound alarming to users. It states in one place, “We work with third-party service providers and other Facebook Companies to help us operate, provide, improve, understand, customize, support, and market our Services,” and adds, “When we share information with third-party service providers and other Facebook Companies in this capacity, we require them to use your information on our behalf in accordance with our instructions and terms.”

What if third-party service providers don’t follow the “instructions and terms,” as had happened when in 2018 Cambridge Analytica was found to have harvested data of 87 million users from Facebook in 2016 under the guise of a survey app? In September 2018, again, hackers were able to exploit an API vulnerability to gain access to data of around 50 million users. In September 2019, data of 419 million Facebook users, including names and phone numbers, was exposed online, said Techcrunch. Three months later, data of 267 million Facebook users was reported by Comparitech as being in the wild. In March 2020, Comparitech revised the number to 309 million after finding data of another 42 million residing on another server had been compromised as well.

Given Facebook’s not-so-stellar record in protecting user data from being exploited by threat actors, it may be concerning for users to let some of their WhatsApp data be mined by Facebook and other third-party service providers.

WhatsApp, on its Privacy Policy page, further adds, “When you or others use third-party services or other Facebook Company Products that are integrated with our Services, those third-party services may receive information about what you or others share with them.” “Please note that when you use third-party services or other Facebook Company Products, their own terms and privacy policies will govern your use of those services and products.”

WhatsApp is not clear what this amounts to when used in conjunction with the previous two statements. Does this mean that if WhatsApp users share certain information with Facebook or other third-party services integrated with WhatsApp, the privacy policies of those services take over and WhatsApp’s privacy policy loses jurisdiction?

It will help if WhatsApp addresses such concerns and questions in its Privacy Policy document.

Pavan DuggalPavan Duggal, Indian cyber law expert

“I’m surprised that WhatsApp has done this even though India is their largest market. Effectively this means that WhatsApp, apart from sharing personal data, also discloses your transaction-associated information, which means including your credit card number, your debit card number, and your bank details. At the same time, they will share the IP address of users. It’s a very perilous situation, especially in a country that lacks a strong legal ecosystem around cyber laws and data security. Such policy changes can upsurge the probabilities of misusing users’ data by anti-social elements.  I strongly believe that people should count on more secure platforms such as Signal and Telegram for their messaging needs now.”

Rajesh Agarwal, Head IT, Aamor Inox

“People are moving to Signal and Telegram, but they are also coming back to WhatsApp. I’ve been using Signal for some time, along with WhatsApp, and found it is not as mature as WhatsApp is. There are many missing aspects in Signal, like, the personal reply feature. I found even the deletion of chat a cumbersome process in Signal. I understand the privacy concerns, but that’s there across the app ecosystem, and here WhatsApp is at least telling users what it is sharing and what’s not. Most of the users are testing Telegram and Signal while keeping WhatsApp as a primary communication tool. It will be exciting to see if this behaviour fluctuates and WhatsApp could address some of the privacy concerns that users may have”

Shashwat DCShashwat DC, Communications & Engagement (Research) at Azim Premji University

“While WhatsApp may try to dispel all fears about privacy expounding that its messaging platform is end-to-end encrypted, in reality, Facebook seems to trying to seize a lot of personal data to earn from its advertising business. To avoid such instances and provide users much-needed control over their data, India needs to implement its data protection law just like Europe’s stringent GDPR at the earliest. The world’s largest democracy, with a burgeoning IT sector, cannot risk the privacy of its citizens.”

There is a need for stakeholders to establish certain minimum privacy-policy norms

The right to privacy has been recognized as a fundamental right emerging primarily from Article 21 of the Constitution of India. Article 21 pertains to protection of life and personal liberty, and states, “No person shall be deprived of his life or personal liberty except according to procedure established by law.” In August 2017, Government of India had set up a committee under the chairmanship of retired Justice BN Srikrishna to submit a report on data protection. The committee submitted its report in July 2018.

In its opening note, the report recognized that “the protection of personal data holds the key to empowerment, progress, and innovation.”

The Committee had noted that “any regime that is serious about safeguarding personal data of the individual must aspire to the common public good of both a free and fair digital economy.” “Freedom refers to enhancing the autonomy of the individuals with regard to their personal data in deciding its processing which would lead to an ease of flow of personal data,” it added.

Justice Srikrishna Committee had emphasized that processing (collection, recording, analysis, disclosure, etc.) of personal data should be done only for “clear, specific and lawful” purposes. Also, only that data which is necessary for such processing is to be collected from anyone.

Based on the recommendations of the committee, amounting to a draft Personal Data Protection bill prepared in 2018, a revised Personal Data Protection Bill was approved and placed in December 2019. A joint Parliamentary Committee (JPC) chaired by Meenakashi Lekhi and comprising 20 members from Lok Sabha and 10 members from Rajya Sabha was constituted to submit its report. The JPC had conducted more than 55 sittings in 2020. Oral evidences were heard by the JPC from various state as well as non-state actors including Amazon, Google, Facebook, Jio Platforms, Paytm, and Twitter, among others. The final report of the JPC is awaited.

 Despite the fact that right to privacy has been recognized as a fundamental constitutional right, experts have been of the opinion that a law on data protection should be dynamic and not statutory in nature. This is more so because as digital economy becomes more and more prevalent and mainstream, data itself becomes dynamic in nature.

Coming to data protection, it is important to first distinguish between stationary data and moving data. While it can be reasonably guaranteed to foolproof privacy and security of stationary data, it can get very hard to ensure privacy of moving data.

The velocity of a moving data can be lightning fast in today’s digital environments. So once a private data gets into a public domain, even the slightest lapse or gap at the end of a data custodian could be disastrous. The hacks and misuses listed out earlier in this report are a testimony to this assertion.

It is therefore critical that, as we progress further into the digital economy, we ought to remove all regulatory fuzziness and laxity on the privacy front. A majority of respondents to the Better World survey subscribe to this view, with 24% noting that the government should ask WhatsApp to roll back the changes and another 43% stating that there needs to be a more holistic regulation in place. However, 33% of the users said that it would be better to let users be the best judge, though less than 22% of these users said they were fully aware of the implications of WhatsApp’s new privacy policy as users. Of the remaining 78%, slightly more than 26% said as users they didn’t understand the implications of WhatsApp’s new privacy policy at all or well enough, though more than 54% of these users said they reasonably understood the implications if not fully well.

WhatsApp privacy policy-Graph4

The choice of alternative reinforces that privacy is the key concern

Signal, which is considered to be the most privacy-oriented messaging app (see Table), was the first choice of those users who said they will look for WhatsApp alternatives. In this case, respondents had the option of selecting one or more apps, including WhatsApp. Telegram, which is considered second-most privacy-friendly app, had the second highest user preference.

While 34% of the users voted for Telegram as a WhatsApp alternative (and in some cases, as a replacement), a good 24% voted for Signal also. A fair percentage of respondents (15%) said they were sticking with WhatsApp even though they were using or considering to use apps other than WhatsApp as well.

The immediate user response, as evidenced from the survey, has been quite aggressive. While 18% of respondents said they had already quit WhatsApp as the only app, another 25% said they planned to do so within a week’s time and yet another 29% said they planned to quit in a month’s time. However, 28% said they had no plans to quit WhatsApp.

FeaturesWhatsAppTelegramSignal
Subscribers (Global)2 billion400 million20 million
Cross platformYesYesYes
Video and voice callYesYesYes
End-to-end encryption Personal messages and calls are end-to-end encrypted.Only for secret chatAll features are end-to-end encrypted
Type of softwareClosed-source privacyOpen-source privacyOpen-source privacy
Information collectionUser’s location, IP address, mobile operator, timezone, phone number, and details of a Facebook or WhatsApp account.Device data, IP addresses for moderation, phone number and the User IDOnly phone number for registration
Group chatsUp to 256 membersUp to 200,000 members1,000 members
File sharing capabilityVideos with 16MB limit in size and regular files up to 100MB2 GB100 MB
Folder managementChats can be stored through emailChats can be moved in to foldersNo such feature exists with Signal
Disappearing messages featureEnables self-destruction of a message after 7 daysEnabled through self-destruct timerEnable self-destruction after 5 seconds to 7 days once a user read the message
Data backupYes, online and offline backup on google driveYes, on Telegram’s cloudNo, stored on its own cloud platform
Group chat securityE2ENoE2E
Cross platformYesYesYes
WhatsApp privacy policy-Graph5
WhatsApp privacy policy-Graph6

Analyst’s Views

Better World is of the view that while the responses to this survey do reflect users’ displeasure with the new privacy policy, the actual actions taken by them will likely be different in many cases. Particularly, those users who are considering to quit WhatsApp in a month’s time, are more likely to have second thoughts and may stay put. It is also likely that some of the users who have already quit may come back after some time.

The key reason for such reconsiderations would be the huge user base that WhatsApp currently enjoys. While WhatsApp had a colossal global base of 2 billion subscribers, Telegram has a much smaller base of 400 million and Signal has a miniscule base of 20 million by comparison. Even if a few million WhatsApp users move to other platforms, it will not be fruitful if a significant percentage of their contacts also move to those very platforms. If that doesn’t happen, users could feel compelled to come back to WhatsApp for their daily messaging needs.

Notably, when considering alternative apps, 26% said they were sticking with WhatsApp. Further, when asked to provide a timeline for quitting, 28% said they had no plans to quit. It is quite possible that when it comes to actually quitting the platform, a much higher number of users will reconsider.

A consolidated view of respondents’ profiles

WhatsApp privacy policy-Graph7

About the Analyst and the Survey Methodology

Deepak KumarDeepak Kumar

Deepak is an ICT industry analyst with more than 25 years of experience in researching and analyzing multiple domains. His focus areas are strategic business and marketing advisory, sales enablement, and public speaking.  He has published reports, whitepapers, case studies, and blogs in areas of cloud, mobility, social media, and analytics.

He is Founder and Chief Research Officer at BM Nxt and Better World. He has earlier worked with IDC, Reuters, Voice&Data, and Dataquest in leadership roles spanning research, advisory, and editorial functions. 

About the report

The Better World WhatsApp Privacy Policy Survey Report was prepared by analyzing results of a primary research and supplementing it with data and insights collected from secondary research.  

The Better World WhatsApp Privacy Policy Survey was conducted via an online form that was circulated among more 1,000 respondents.  A total of 565 valid responses were collected during the period 9 January to 25 January 2021.  Better World also spoke to multiple respondents for qualitative insights. The surveys were led by Jatinder Singh, Director, Research and Insights, Better World, and independent market researcher Deepti Arora.  

Acknowledgements

I take this opportunity to sincerely thank all the survey respondents for taking time out and providing their inputs, without which this report would not have been completed in a timely manner. 

MORE FROM BETTER WORLD

India’s Razorpay joins Unicorn club with fresh funding, eyes expansion

India’s Razorpay joins Unicorn club with fresh funding, eyes expansion

 

One of the few successful Indian fintech startups, Bangalore-based Razorpay, joins the Unicorn club, as it has secured $100M in a new funding round. With this cycle of financing, the payment startup has also become the first Indian payment-gateway to achieve US$ 1bn valuation.

“Razorpay secures $100 million in Series D funding led by GIC, Singapore’s sovereign wealth fund, along with Sequoia & our existing investors Ribbit Capital, Tiger Global, Y-Combinator and Matrix Partners. The funding also comes with a significant milestone of Razorpay becoming the newest unicorn in India, informs Shashank Kumar, Co-founder, Razorpay, through the company’s official blog.

Set-up in 2013 by Shashank Kumar and Harshil Mathur, Razorpay had raised $75 million in Series C funding last year. 

Razorpay’s ambitions after joining Unicorn Club

Razorpay offers social media sellers and SMEs a convenient mechanism to take payments online without a website or a payment gateway integration.  The company plans to employ the fresh capital to scale up its solutions such as RazorpayX, a neo-banking platform, and Razorpay Capital, a quick business loan platform. It also plans to hire about 500 employees this fiscal year.

Razorpay also provides cash advance service to Micro, Small, and Medium Enterprises (MSME), through collaboration with banks. As Razorpay secures $100 million funding, this will enable it to expand its lending solution capabilities. The company says that over 50% of Indian SMEs still don’t have access to digital financial tools, and it is determined to help these businesses in the best possible manner.

“We strongly believe that RazorpayX will charter our next growth chapter – driving the mobile-first, technology-first transformation of business banking, suited to the digital needs of businesses today and helping them make better decisions,” adds Kumar.

Market onlookers view this development as spectacular since it demonstrates investors’ growing confidence in the Indian startup ecosystem despite the uncertain economic environment. The COVID-19 pandemic has accelerated digital technology’s acceptance, forcing people to alter their behavioral buying patterns and move to online channels.

Razorpay’s list of clients includes Facebook, Google, Jio, Hotstar, Wikipedia, Meesho, among many other independent contractors and SME’s.

Digital transactions gain steam during the pandemic

Led by the Indian government’s increased impetus and growing digitization, the country’s digital payments ecosystem is ready to see a monumental rise. According to the Bank for International Settlements (BIS), India saw digital transaction uptake of about 55% in 2018 compared to 11.4% in Brazil, 35% in Russia, and 23% in Indonesia.

With a mushrooming work-from-home and cautious approach due to COVID-19, the country is expected to see rapid growth in the digital transformation across all sectors and industries. Additionally, from a demographic perspective, more than 60% of India’s population is under 35 years, mostly extremely tech-savvy. This young population is equipped with high disposable income, inexpensive smartphones, and 24*7 data connectivity. It makes them prime potential customers of non-bank digital players.

Additionally, events such as demonetization and COVID-19 have also fast-tracked the digital payment ecosystem’s overall growth.

Companies like Razorpay seems to be cashing in on these exceptional attributes and expanding their solution capabilities. There is also a tremendous interest among many fintech companies and investors to set their shop locally and be a part of India’s growth story.

Besides Razorpay, other prominent digital payment gateway players battling for India’s market share include PayMate, Paytm, CC Avenue, PayU, Paytm, and Mobikwik.

IBM to split into two companies for better cloud opportunity

IBM to split into two companies for better cloud opportunity

Global tech major International Business Machines Corporation has surprised everyone by splitting itself into two companies by the end of 2021. The decision has been taken by IBM to focus on the high-margin cloud computing business and enterprise digital transformation efforts.

IBM mentioned that it would split into two companies by untying the managed infrastructure services unit of its Global Technology Services division. The new company would exclusively focus on legacy infrastructure business and gets its leadership structure in place soon. According to IBM, the unit presently serves around 4600 clients with an order backlog of $60 billion.

“We are focused on accelerating our growth strategy and seizing the $1 trillion hybrid-cloud opportunities. Today, hybrid cloud and AI are swiftly becoming the locus of commerce, transactions, and over time, of computing itself. This shift is driven by the changing needs of our clients, who find that choosing an open hybrid cloud approach is 2.5 times more valuable than relying on public cloud alone,” stated Arvind Krishna, IBM Chief Executive Officer, in a blog post.

The foundation stone of this spin-off was laid by IBM’s $34 bn acquisition of Red Hat. The Red Hat buy helped IBM to gain capabilities to build an exceptional-quality hybrid cloud. IBM believes that Red Hat’s open-source, hybrid cloud platform will form the basis for developing and market higher-end AI-enabled software applications and solutions in the future.

“With Red Hat in our portfolio, we have since launched our Cloud Paks and strengthened our systems portfolio. We built an industry-specific cloud designed to tackle the most stringent needs of the financial services industry. And we beefed up our hybrid cloud and AI capabilities by acquiring two companies, Spanugo and WDG Automation,” Krishna elucidates.

An intelligent move

This announcement of IBM to split into companies is an exciting development as it will enable the corporation to fortify its focus on a profitable business line, i.e., cloud. In the post-COVID-19 world, enterprises are expected to inspire their business models and infrastructure modernization with robust digital transformation initiatives (See: Technology trends for businesses in 2020).

The rising adoption of remote-work is accelerating the adoption of cloud solutions. Shortly, technologies such as artificial intelligence (AI), data analytics, automation, and augmented reality will be implemented hugely by organizations. As such, IBM would want to capture a bigger pie of the high-value cloud software and solutions. The move will also help IBM become more agile by simplifying and optimizing its operating model.

Due to the low demand for its software and mainframe servers, the company has been aggressively expanding its cloud portfolio in recent times. IBM has been making several rounds of reshuffle and readjustments in its business strategy over the last couple of years.

IBM has been facing significant challenges to improve its top line due to the strained services business. It has also announced massive job-cuts recently in a bid to restructure its business operations. It looks like this new spin-off may be a turning point in the company’s 109 years history and help it deliver more remarkable results in the times to come.

IBM currently has over 350,000 employees and expects to spend about $5 billion in expenses related to the division’s operational and other aspects. Immediately after the announcement, the company’s shares saw a jump of 6% on NYSE.

 

 

India’s 2020 4G Spectrum auction set for further delay

India’s 2020 4G Spectrum auction set for further delay

The next phase of the 4G spectrum auction in India seems to be heading for another delay due to the ongoing COVID-19 crisis. The auction, which was scheduled for this month, yet to see any government’s cabinet note. The cabinet note is mandatory for the commendation of the spectrum base price and quantity that requires to be put below the mallet.

One needs to note that before any spectrum auction in India, the Department of Telecommunications (DoT) issues a formal Notice Inviting Applications (NIA), inviting interested service providers to bid for the mobile services spectrum. The total procedure typically needs around 45 days to fill out before the actual auction starts.

This would be the second consecutive deferment of India’s 4G spectrum auctions, which includes seven bands in 22 circles. The radio waves for grabs include 700Mhz, 800Mhz, 900 MHz, 1800 MHz, 2100 MHz, 2300 MHz, and 2500 MHz bands. Earlier, the government intended to schedule the auction in March this year, but due to COVID-19 related restrictions, it had to postpone it to October.

The government has already pushed the auction of 5G spectrum in the 3300-3600 MHz band to 2021 due to telecom operators’ tight budgets and inability to meet the high reserve prices earmarked by India’s telecom sector regulator, Telecom Regulatory Authority of India (TRAI).

India is expecting to earn over INR 4 lakh crores from the auction.

Reliance Jio pushes for early 4G spectrum auction

India’s largest telecom operator, Reliance Jio, seems to be the only telecom operator who wants to speed up the 4G spectrum auction sale. Other telcos, Bharti Airtel and Vodafone Idea (Vi), are in no rush and have indicated that they would be happy if the auction is delayed.

“We are unable to find any reasonable rationale behind this sudden pause in a successful and fruitful policy of auctioning all available spectrum every year, since the Supreme Court decision in 2012,” stated Reliance Jio in a letter addressed to DoT Secretary, last month.

The Mukesh Ambani led Jio to expand its infrastructure in India and has a big concern over the 4G spectrum auction delay in India because its airwaves license in the 800 MHz bands is expiring next year. The company, which uses the 800 MHz band of Anil Ambani’s insolvent company Reliance Communications, has recently raised over 1.50 lakh crores funding from Google, Facebook, Microsoft, and Silver Lake. (See: Jio driving digital shifts in the economy)

Jio is also adding a significant number of subscribers every month, and need more spectrum to provide quality 4G services throughout the nation. Its mobile-first approach has helped it gain a substantial footing in the market, and improved data adoption in India enormously. (See: The Jio ecosystem has begun to unfold)

In contrast, Airtel and VI are financially stressed and witnessing a big challenge in improving their market share. Though their spectrum license in the 1800 MHz band is also due for renewal in 2021, it is less expensive. Both the operators also have backup airwaves to support their subscribers, hence keen to streamline their financial budgets before participating in the 4G spectrum auction in India.

 

Growth of Indian IT sector set for revival in 2021

Growth of Indian IT sector set for revival in 2021

After facing multiple headwinds due to the COVID-19 pandemic and sluggish economic recovery, the growth of Indian IT sector seems to be on the path of retrieval.

A recent study by Fitch, a global credit rating agency, says that due to the enormous demand for digital transformation solutions, the IT Services industry revenue will start upward by a high single-digit percentage in 2021-22.  The sector, however, will continue to see minimal revenue growth in FY20, says the report titled Spotlight: Indian IT Services Sector.

The IT industry has grown at a CAGR of 8% during 2014-2019, based on Fitch’s estimate.

The report comes as no surprise as most technology leaders have been extremely cautious about IT spending and exploring several ways to transform their businesses digitally in the wake of the current crisis.

New normal leading the growth of Indian IT sector

The new normal, where most of the employees work from home, has been a compelling force for businesses to transform every aspect of their operations and move from legacy systems.

The focus has been growing steadily on automation, artificial intelligence, and data science to swiftly increase employee efficiency and productivity. The industry expects that technologies like Analytics and AI would continue to play a more significant role in the growth of the Indian IT sector along with driving enriching experience for employees and customers. Moreover, the next twelve months will see faster adoption of transformative technologies such as the internet of things (IoT), Blockchain, and robotic process automation (RPA). These technologies will be used to build contactless solutions and strengthen process efficiencies. Customer Organizations will be seen ramping-up their research and development initiatives to kick-start the economy. (See: How is digital transformation shaping the new future?)

Most enterprises across sectors have realized the benefits of these technologies for the growth of their IT industry and putting a strong emphasis on improving their internal IT budget scope. (See: Anshuman Tiwari, Global Head of Delivery Excellence, DXC Technology; and CIOs to focus on network transformation for business continuity).

Digital transformation tailwinds favor India’s IT sector

To meet the growing demand, IT Services companies are rapidly increasing their competencies and will continue to enter into incredible collaborations and acquisitions that will further beef up their digital transformation capabilities and revenue prospects in 2021, despite the current decline. (See: Tech Cos take M&A route for digital transformation supremacy).

In addition, there is also a cost advantage, i.e., the salaries in India are much lower as compared to the countries like the U.S. This is expected to create a massive growth opportunity for the U.S. and European firms to expand their base in India.

Top recent partnerships

Company

Partner

Initiative

TCS

IBM

Develop a new unit to help clients achieve a greater level of digital and cognitive enterprise transformation using IBM’s cloud service

Infosys

Genesys

AI solution to augment query management and scale helpdesk operations to enhance productivity and customer satisfaction.

 

Wipro

Intel

Provide remote work solutions with enhanced cybersecurity measures to customers

 

Tech Mahindra

Microsoft

Develop enterprise cloud solutions leveraging Microsoft platforms and technologies to meet customer needs and pursue growth

 

Mphasis

Amazon Web Services (AWS)

Provide an end-to-end cloud and cognitive portfolio of services leveraging its partnership with AWS, with its new status of premier consulting partner

 

Hexaware

Freshworks

Offer customer and employee-engagement software for digitally native business

 

Source: Fitch.

Quote:

“We expect the Indian IT services industry to continue to take advantage of its low-cost operations and maintain its strong foothold in the global IT sector”

-Keith Poon, Fitch Ratings

Paytm Mini App Store: A threat to Google’s dominance?

Paytm Mini App Store: A threat to Google’s dominance?

Digital payments firm, Paytm, has tossed a new android mini-app store or links to progressive web apps (PWAs), intending to support Indian startups and contest Google’s dominance in the play store. Paytm Mini App Store is an exciting development for the Indian digital ecosystem, where many of the startups and developers can leverage Paytm’s reach and payment arrangements.

Paytm’s new app store will enable local developers to test their mobile applications’ capabilities on an all-new local app platform, for free of cost.

For the last few months, many Indian app developers have been mulling the idea of an alternate Indian local app store. The aim is to give an alternate option to house India’s android based mobile applications and counterbalance the dependency on the Google Play store. The mini-apps platform provides an engrossing one-click experience for users without downloading the apps. This new ecosystem will also help millions of Indian smartphone users who use budget-friendly low-storage phones.

Paytm Mini App store launch resonates with the “Atmanirbhar Bharat” mission, a popular PR tactic for many companies since the ban of several China-based apps. According to Paytm, over 300 apps, such as ride-hailing major Ola, online pharmacy store Netmeds, fast-food giant Domino’s, online food startup Fresh Menu, No Broker, etc have joined the Paytm app store.

 What influenced the development of the Indian App Store?

 It seems like the Paytm Mini app store’s idea has been triggered because of the two factors. Both Paytm and Google entered into conflict last month when Paytm owned ‘First Games’ app was removed from Google’s Play Store.

Google had alleged that Paytm’s app violated play store gambling policies by introducing a real cash-based fantasy cricket tournament. Paytm, on the other hand, confronted that Google’s move was a deliberate attempt to confine Paytm’s growing dominance in the Indian market and control the growth of a potential rival.

Though Google reinstated the Paytm’s app within hours, the incident triggered an acrimonious war of words between the tech giants.

The second factor that compelled many developers and companies to support the idea of a new Indian app store was Google’s fresh mandate. According to Google, all app developers on the Play Store would need to use its in-app payment system from the near future, i.e., the US company’s billing system, where app developers will have to shell out a 30 percent fee from their payments.

Google’s 30% fee for in-app purchase decision has been slammed by many developers and startups in India who voiced their displeasure of this move. After the pushback, Google analyzed the situation in time and decided to delay the 30 percent Play Store cut in India.

An ambitious gamble

Google Play is the world’s leading android app store and houses over 3 million apps. Besides, many other players such as Amazon AppStore, GetJar, Aptoide, and Opera Mobile store have been battling to up their popularity charts with limited uptake.

It would be interesting to see if Paytm’s new app store could become a game-changer or turns out to be an extempore in response to the recent events and its squabble with Google.

The app store marketplace is no laid-back business. Paytm would need much investment, technology upgrades, and innumerable alliances to develop an alternative app distribution ecosystem for Indian android users. Others will be watching this space closely and may throw some competitive elbows.

Paytm has recently been investing significantly in marketing its UPI, and claims to hold about 50 percent market share in the segment. The company also plans to foray into the US market and plans to compete with Amazon and Flipkart’s likes in the e-commerce space.

Airtel beefs up cybersecurity portfolio, eyes new business

Airtel beefs up cybersecurity portfolio, eyes new business

Global telecommunication company Bharti Airtel launches several new offerings to fortify its enterprise business. The company has announced two strategic alliances to bring new-age cybersecurity solutions and has unveiled a Security Intelligence Center (SIC) to enhance enterprise network monitoring capabilities.

All the new offerings are introduced under the umbrella of Airtel Secure.

The Telco has reportedly spent about Rs. 100 crores for the launch of the new SIC. Situated in the National Capital Region, the center will provide remote network monitoring and tracking services through artificial intelligence and machine learning tools to mitigate potential threats.

Airtel has also signed strategic pacts with Cisco and Radware to develop enterprise customers’ security solutions and capabilities. With its collaboration with Cisco, a networking giant, Airtel will offer innovative monitoring, analysis, and investigation of malicious code services to its customers. It will also develop new cybersecurity solutions for businesses to secure networks, endpoints, applications, and the cloud.

Another strategic deal involves Radware, a leading provider of cybersecurity, and application delivery solutions. Through this partnership, the company has been able to set-up India’s first global scrubbing center. This will ensure that all cyber threats to data and information are attacked and eliminated at the country’s source. Airtel’s Nxtra Data will host this advanced facility in Chennai.

The company informed that it has already signed Flipkart, Havell’s, Fidelity India, R-Systems, among others as its customers for the service.

“At Airtel, we constantly ask our customers what more can we do to help them in their digital transformation journeys. Through these conversations, we have heard that cybersecurity is a critical requirement. Airtel Secure has been built to serve this need. It combines Airtel’s robust network security with cutting-edge solutions delivered through global partnerships to deliver end-to-end managed security services,” said Gopal Vittal, MD & CEO (India and South Asia), Bharti Airtel.

Need for proactive cybersecurity solutions gain currency

The cybersecurity market is developing at a fast rate. According to a recent report by Nasscom-DSCI, the Indian cybersecurity services industry is expected to grow at a compound annual growth rate (CAGR) of about 21 percent to touch USD 13.6 billion by 2025.

The opportunity has been further grown because of the pandemic induced remote work scenario. There has been a massive upsurge in bandwidth consumption from various home networks, which may not be as secure as office networks. This new normal creates an enormous scope for threat actors to hack systems and negatively impacts job performance and employee productivity.

Enterprises face mounting pressure to address the rising security threats and need proactive solutions and support to track their network. In a bid to increase their security solutions canvas, most Indian telcos are collaborating with IT majors to establish digital trust and provide a robust connectivity experience to their customers.

Early this year, Vodafone Idea’s enterprise arm, Vodafone Idea Business Services (VIBS), also entered into a partnership with IBM to establish a data security device management solution for enterprises.

Mukesh Ambani-owned Jio is also concentrating on catering to small and medium businesses’ information security needs and has big plans lined up for the next year.

Among all telcos, Airtel is leading the B2B connectivity space and serves over 2500 large and one million-plus SMEs and startups with its integrated product portfolio that includes data centers, cloud, security, and collaboration.

 

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