Report from Reuters
In Brief – Meta will temporarily exempt Italy from its ban on rival AI chatbots using WhatsApp to interact with customers. The move comes in response to the Italian competition watchdog, AGCM, ordering Meta to suspend the ban while it investigates whether the company abused its market power. Meta updated its WhatsApp business terms of service in October blocking new AI chatbot providers immediately and closing the messaging service to existing chatbot providers in January. Italy’s regulator argued that the WhatsApp ban could exacerbate consumer lock-in and reduce choice in the emerging chatbot market, as well as irreversibly harm competition in the development of AI chatbot competitors. The regulator highlighted Meta’s strong position in the market for messaging apps, while Meta argued that the growth of AI chatbots had strained systems that were not designed to support them. Small AI developer Interaction Company of California, creator of AI assistant Poke.com, which has filed antitrust complaints with both Italian and EU regulators, said Meta should have suspended their policy globally, and urged the European Commission to adopt similar interim measures.
Context – Soon after WhatsApp’s temporary change of policy in Italy was made, the company responded to a similar order from the Brazilian competition authority to likewise pause for 90 days the ban in that country. The European Commission competition authority is also investigating the WhatsApp chatbot policy, although the Brussels investigation does not currently block Meta’s policy from going into effect. Although WhatsApp is a regulated platform under the Digital Markets Act, the Commission is pursuing a traditional antitrust investigation, likely because Meta’s AI chatbots are not regulated by the DMA. While WhatsApp enjoys very high market shares for direct messaging services, Meta’s chatbots enjoy far smaller shares in the AI chatbot market. For example, while Chat-GPT has a nearly 80% share in the EU and higher in Brazil, Meta’s chatbots barely register.