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Meta faces Italian competition investigation over WhatsApp AI chatbot

Meta Faces Italian Antitrust Probe Over WhatsApp's AI Chatbot Integration

Rome, Italy – July 30, 2025 – In a move that underscores growing regulatory scrutiny on Big Tech's forays into artificial intelligence, Italy's competition watchdog has launched an investigation into Meta Platforms Inc. over its integration of an AI-powered chatbot into the popular messaging app WhatsApp. The probe, announced by the Autorità Garante della Concorrenza e del Mercato (AGCM), centers on allegations that Meta may be abusing its dominant market position to unfairly promote its AI tools, potentially stifling competition in the digital messaging and AI sectors.

The investigation stems from Meta's recent rollout of an AI chatbot feature within WhatsApp, which allows users to interact with an intelligent assistant for tasks such as answering queries, generating content, and providing personalized recommendations. This feature, powered by Meta's advanced language models similar to those used in its Llama AI series, was introduced globally earlier this year as part of a broader push to embed generative AI across Meta's ecosystem, including Facebook, Instagram, and now WhatsApp. However, Italian regulators are concerned that the way this integration has been implemented could violate EU competition laws, particularly those related to the abuse of dominance under Article 102 of the Treaty on the Functioning of the European Union (TFEU).

According to the AGCM's statement, the probe will examine whether Meta is leveraging WhatsApp's massive user base—estimated at over 2 billion active users worldwide, with a significant portion in Europe—to give its AI chatbot an undue advantage over rival AI services. Critics argue that by bundling the AI tool directly into WhatsApp, Meta is effectively tying its messaging service to its AI offerings, making it difficult for independent AI developers or competing chatbots to gain traction. This could create barriers to entry for smaller players in the burgeoning AI market, where innovation is key but market power often determines success.

The Italian authority highlighted specific practices that raised red flags. For instance, the AI chatbot is prominently featured in WhatsApp's interface, with users receiving notifications and prompts to engage with it upon updating the app. Regulators are investigating if these prompts are overly aggressive or if they collect user data in ways that enhance Meta's AI capabilities while disadvantaging competitors. Data privacy is another angle: WhatsApp's end-to-end encryption has long been a selling point, but integrating AI raises questions about how user interactions with the chatbot are processed. Meta has assured that chatbot data is handled separately and not used to train broader models without consent, but skeptics point to past controversies, such as the Cambridge Analytica scandal, as reasons for caution.

Meta, the parent company of WhatsApp, responded swiftly to the announcement, expressing disappointment but pledging full cooperation with the investigation. In a statement, a Meta spokesperson said, "We believe our AI integrations enhance user experience and are fully compliant with all relevant regulations. WhatsApp's AI chatbot is designed to provide value to our users, not to unfairly compete. We're committed to working with the AGCM to address any concerns." The company emphasized that the feature is optional and that users can opt out at any time, arguing that it promotes innovation rather than hinders it.

This isn't the first time Meta has faced antitrust heat in Europe. The company has been under the microscope for years, with ongoing cases related to its data practices, advertising dominance, and acquisitions like that of Instagram and WhatsApp itself. In 2023, the European Commission fined Meta a record 1.2 billion euros for transferring EU user data to the U.S. in violation of GDPR rules. More recently, under the Digital Markets Act (DMA), which came into full effect in 2024, Meta has been designated as a "gatekeeper" platform, subjecting it to stricter rules on interoperability, data sharing, and fair competition. The WhatsApp AI probe could be seen as an extension of these efforts, testing how gatekeepers integrate emerging technologies like AI without abusing their positions.

Experts in competition law suggest that the Italian case could set important precedents for how AI is regulated in the EU. "This investigation highlights the tension between innovation and competition," said Dr. Elena Rossi, a professor of antitrust law at the University of Bologna. "Meta's strategy of embedding AI into its core apps is smart business, but if it locks users into an ecosystem where alternatives are sidelined, it could be deemed anticompetitive. We're likely to see similar probes in other member states if Italy finds wrongdoing."

The broader context of AI regulation in Europe adds layers to this story. The EU's AI Act, which classifies AI systems based on risk levels and imposes bans on high-risk uses, is set to be fully implemented by 2026. WhatsApp's chatbot, while consumer-facing and low-risk in many applications, could fall under scrutiny if it's used for purposes like automated decision-making or profiling. Moreover, the integration raises questions about data monopolies: Meta's vast troves of user data from its social platforms give it a head start in training AI models, potentially creating an uneven playing field.

From a user perspective, the AI chatbot has been met with mixed reactions. Some praise its convenience—for example, quickly translating messages, summarizing conversations, or even generating creative responses in group chats. In Italy, where WhatsApp is ubiquitous for both personal and business communication, the feature has seen rapid adoption. A recent survey by tech analyst firm Canalys indicated that over 40% of European WhatsApp users have tried the AI tool since its launch. However, privacy advocates worry about subtle data collection. "Even if encrypted, interactions with AI could reveal patterns that Meta exploits elsewhere," noted Marco Bianchi, a digital rights activist with the Italian NGO Privacy Italia.

The investigation is expected to last up to 18 months, during which the AGCM will gather evidence, interview stakeholders, and possibly impose interim measures if immediate harm to competition is identified. If found guilty, Meta could face fines up to 10% of its global annual turnover—a staggering amount given its 2024 revenue exceeded $130 billion. More significantly, it might be forced to alter how the AI chatbot is integrated, perhaps by making it easier for users to switch to third-party AI services or by opening up APIs for interoperability.

This case also reflects Italy's proactive stance on tech regulation. Under Prime Minister Giorgia Meloni's administration, Italy has positioned itself as a leader in enforcing EU digital rules, from taxing tech giants to probing content moderation on platforms. The AGCM has previously investigated companies like Google and Amazon for similar dominance issues, establishing a track record of robust enforcement.

As the probe unfolds, it could influence Meta's global AI strategy. The company has been aggressively expanding its AI ambitions, investing billions in infrastructure and talent. Mark Zuckerberg, Meta's CEO, has repeatedly touted AI as the future of connectivity, envisioning a world where AI assistants are seamlessly woven into daily digital life. Yet, regulatory hurdles like this Italian investigation could slow that vision, forcing Meta to navigate a patchwork of national and supranational rules.

In the meantime, competitors are watching closely. Rivals like OpenAI, with its ChatGPT, or Google's Bard (now part of Gemini), could benefit if Meta is reined in. Smaller European AI startups, such as France's Mistral AI or Germany's Aleph Alpha, might find new opportunities if the playing field is leveled. For consumers, the outcome could mean more choices in AI tools, but also potential disruptions to familiar app features.

Ultimately, this investigation is more than a spat over a chatbot; it's a litmus test for how Europe balances technological progress with fair market practices in the AI era. As AI becomes integral to communication platforms, ensuring competition remains vibrant will be crucial to fostering innovation that benefits all, not just the tech titans. Meta's response and the AGCM's findings will likely shape the discourse for years to come, influencing not just WhatsApp but the entire landscape of AI-integrated services across the continent.

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Read the Full reuters.com Article at:
[ https://www.reuters.com/business/meta-faces-italian-competition-investigation-over-whatsapp-ai-chatbot-2025-07-30/ ]