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Meta picks India for WhatsApp's first e-commerce service

Indian residents will be able to buy their groceries through the chat app – for as long as the government is happy with the idea

Meta's messaging service WhatsApp will launch its first end to end e-commerce service in India, through an alliance with giant conglomerate Reliance Industries’ digital business and mobile telephony subsidiary, Jio Platforms.

“This is our first-ever end-to-end shopping experience on WhatsApp -- people can now buy groceries from JioMart right in a chat. Business messaging is an area with real momentum and chat-based experiences like this will be the go-to way people and businesses communicate in the years to come," said Mark Zuckerberg in a launch announcement released on Monday.

The WhatsApp shopping experience is limited to India and to the online grocery store known as the JioMart catalogue. The service is initiated by sending ‘Hi’ to the JioMart telephone number on WhatsApp.

The messaging app, once thought of as a sanctuary of encryption and user privacy, was purchased by Facebook Inc, now Meta, in 2014 for $19 billion. WhatsApp is free to use and Meta has struggled to monetize the service. How the Indian e-commerce tie-up might address that issue has not been explained.

Meta also owns a chunk of Jio Platforms, having put down $5.7 billion for a 9.99 percent stake in April 2022. Presumably money will flow to Meta as a result of this deal, perhaps in ways to shows how the company plans to profit from WhatsApp's two-billion-plus users.

At the time of its investment in Jio, the company formerly known as Facebook said the deal was aimed at "creating new ways for people and businesses to operate more effectively in the growing digital economy,” including a collaboration with JioMart to enable customers to contact and purchase from local businesses through WhatsApp.

The transaction also gave Meta a footprint in India, a nation that has pushed back against the company's plans. Some previous Meta efforts to launch initiatives in India have been criticized as anti-competitive, such as a plan to offer free internet access tied to Facebook that regulators killed in 2015. That proposed service would have used Reliance Communications' networks.

India has, in general, sought to curtail the market power of tech giants, at times through legislation and also with a government-run independent e-commerce aggregator designed to let small merchants sell online without going head to head with Amazon or Walmart-controlled Flipkart. India's Consumer Protection (E-Commerce) Rules, 2020, demonstrate government policy eloquently with a ban on flash sales - a tactic seen to be used by big tech to dominate markets - and a requirement that users must be able to identify out imported goods sold at online marketplaces.

E-commerce in India is currently dominated by the likes of Amazon and Flipkart – each holding about one-third of the market share. It’s hard to see how outsiders will elbow their way in, but Reliance Jio's 400-milion plus users give Meta a good starting point.

But massive presence alone is no guarantee of success. Tata, the conglomerate that includes tech outsourcer Tata Consulting Services an e-commerce app called Tata Neu in May 2022.

Unfortunately the app flopped, with users complaining about inconsistent experiences as servers crashed - a bad look for a company that claims expertise building systems for other companies. ®

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