The Asian Voice

Does the WhatsApp controversy affect Indonesian SMEs?: Jakarta Post contributors

The writers say that from the SMEs' viewpoint, leaving WhatsApp could affect their businesses through a migration to messaging apps which are not yet equipped with "business" features.

It is too early to expect that WhatsApp finally shelves its privacy updates plan, but certainly a commitment to protect users' personal information, data safety and security is all the public wants, say the writers.

JAKARTA (THE JAKARTA POST/ASIA NEWS NETWORK) - WhatsApp's new privacy policy which no longer allows users to opt out of sharing their data with its parent company Facebook has sparked controversy and a massive migration to rival messaging apps around the world.

According to the new policy, WhatsApp will automatically share user data like phone numbers, address books, pictures and the content of some messages with Facebook. The new policy was to come into effect on Feb 8.

Following the changes in WhatsApp's privacy policy, its rivals, Signal and Telegram, saw a surge of downloads worldwide. Signal downloads skyrocketed to 7.5 million in the week after the announcement made - 30 times the 250,000 downloads seen in the previous week.

Telegram also saw a vast increase in users, with weekly downloads reaching nine million, up from 6.5 million in the previous week. Despite the concern about data privacy, it is unlikely the WhatsApp policy will affect small and medium enterprises (SME) in Indonesia.

Here are the reasons why.

The Covid-19 pandemic has vastly changed the way of working for governments, companies and private users.

In Indonesia, mitigating the impacts of the Covid-19 pandemic and restoring the national economy top the government's agenda. For the Ministry of Cooperatives and SMEs, the main goal is to increase SMEs' adaptability and sustainability through intensifying the digital transformation.

In 2020, the aim was to have 10 million SMEs go digital.

As that target has been fulfilled, with 10.25 million SMEs going digital, the next goal is to have 30 million SMEs digitalised by 2023.

While the digitalisation of SMEs is reflected not only in the extent to which business players use WhatsApp for advertisement and promotion, it cannot be denied that WhatsApp remains their top channel of communication with customers and business partners.

Throughout 2020, WhatsApp offered digital business training for more than 4,500 SMEs in the country, to equip them with the knowledge of offline-to-online business conduct.

Now, at least six million SMEs have used the WhatsApp Business platform which, among other things, allows the use of auto-message and product cataloguing features.

According to Ms Karissa A. Sjawaldy, Facebook Indonesia's public policy manager, the potential is to reach 60 million SME users. But, of course, this number does not include SMEs that use WhatsApp only as a means of communication.

WhatsApp users in Indonesia now total 143 million. The WhatsApp download statistics in Indonesia do not seem to be affected by the new privacy policy, unlike in Brazil, India or the United States.

Instead, there were 7,000 downloads in Indonesia within the week after WhatsApp introduced its new policy.

Perhaps, only tech-savvy Indonesian cooperatives and SMEs may be considering migrating.

They include about 900 digital cooperatives that already own websites and 350,000 SMEs that are digitally transforming their business operations to an online mode.

For SME players in Indonesia - the largest archipelagic country in the world - the compromise of leaving WhatsApp is between data protection and privacy rights vis-a-vis sustainable livelihood.

From the SMEs' viewpoint, leaving WhatsApp could affect their market businesses through their migration to presumably more secure messaging apps (like Signal and Telegram), which are not yet fully equipped with "business" features.

They may lose customers and business partners unless they also migrate. Short message service (SMS) is no longer seen as an alternative way of communication - only 10 per cent of the population in Indonesia still use SMS.

Some messaging apps may force both parties to learn and adjust, which takes time. Henceforth, it is likely that most SME users will stick with WhatsApp for the sake of convenience, practicality and livelihood.

Indonesia is still preparing the national data protection Bill. The government's commitment to protecting personal data is out of question.

That commitment was evident when, shortly after WhatsApp's new data privacy policy went viral, Communications and Information Minister Johnny G. Plate called for clarification due to concerns about the possible unlawful use of personal information.

WhatsApp eventually delayed the enforcement of privacy terms until May 15, but postponing the policy is not necessarily the answer to the controversy, considering millions of records of user data lost in Facebook breaches in the past.

Furthermore, given that WhatsApp has already expanded its business in Brazil and India through WhatsApp Payment and will do so in Indonesia soon, the company will have excessive access to personal user data, especially banking information, of Indonesia's 4.3 million digital-finance-literate SMEs.

It is too early to expect that WhatsApp finally shelves its privacy updates plan, but certainly a commitment to protect users' personal information, data safety and security is all the public wants.

Dio Herdiawan Tobing is the executive director of PolicyLab Indonesia and senior fellow with Asean Studies Centre Universitas Gadjah Mada. Vicky Nauli Barreto Simanjuntak is a policy advisor for the creative economy's empowerment at the Ministry of Cooperatives and SMEs. The Jakarta Post is a member of The Straits Times media partner Asia News Network, an alliance of 24 news media organisations.

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