The consent pivot: Why Meta’s data "surveillance" loss is Google and YouTube’s gain

The National Company Law Appellate Tribunal’s clarification on WhatsApp data use is beginning to force a practical rethink inside media plans, even if it has not yet triggered an immediate flight of budgets away from Meta. For digital marketers, the shift is less about panic exits and more about recalibrating how performance, scale, and predictability are defined in a consent-constrained environment.

At the heart of the change is WhatsApp’s role as a performance engine. For years, click-to-WhatsApp ads, conversational commerce, and SME-led lead generation have been tightly optimised around outcomes rather than impressions, allowing brands to justify spend even as data opacity persisted in the background.

Gowthaman Ragothaman, media veteran and CEO of Saptharushi, said that in the near term, this outcome-based structure will likely soften the immediate impact of the ruling. “Until now, WhatsApp-based campaigns have been closely tied to performance outcomes such as clicks, leads, or sales. In response to the ruling, Meta is likely to compensate by increasing ad impressions to meet delivery and outcome commitments. In the short term, this means brands may not immediately pull back budgets or shift spend to other platforms, since the pricing remains outcome based and advertisers may still see acceptable results,” he said.

However, Ragothaman warned that this model is unlikely to hold indefinitely. “As campaigns run longer, marketers are likely to notice declining efficiency. The pool of consented users will shrink, and even among those who have consented, response rates may not match historical levels. Both factors reduce the effectiveness that made WhatsApp-driven campaigns attractive in the first place,” he said.

This, he added, will force brands to reassess benchmarks that once scaled easily. “Campaign performance that once scaled easily may now be more time bound and harder to sustain. Over time, marketers are likely to explore alternative platforms and channels that offer more reliable targeting and reach under evolving consent requirements. In effect, the ruling forces a recalibration of expectations, measurement, and media mix, rather than an immediate budget flight,” Ragothaman said.

That recalibration is already visible in how marketers are thinking about data and targeting strategies. Prashant Puri, Co-Founder and CEO of AdLift (Liqvd Asia), said the ruling accelerates a move away from passive data dependence. “Digital marketers will have to move away from passive, data-led targeting and lean harder on explicit consent, contextual signals, and first-party relationships. The NCLAT ruling makes it risky to rely on WhatsApp or Meta ecosystem data unless users have clearly opted in, which means sharper consent journeys and cleaner data practices,” he said.

Puri believes reallocation is inevitable, even if gradual. “As WhatsApp-linked and Meta-driven targeting becomes more constrained, marketers will rebalance spends toward platforms and channels where consent, intent, or context are clearer. This ruling nudges India’s ad market toward intent, content, and consent, reducing over-dependence on any single platform,” he said.

A similar sentiment is emerging among agencies that work closely with large consumer brands. Sahil Chopra, Founder and CEO of iCubesWire, said the ruling removes a long-held assumption baked into Meta-led planning. “Brands and marketers can’t just assume WhatsApp data will automatically make Meta campaigns work better anymore, so there’ll be more focus on clean first-party data and smarter messaging,” he said.

Chopra does not expect abrupt exits from Meta but anticipates more diversification. “Most brands won’t suddenly kill campaigns on Meta, but they will reallocate budgets a bit more to Google, retail media, and strong publisher platforms so they’re not too dependent on one platform. The real winners will be brands that already know their customers well, platforms that don’t rely on heavy tracking, and Indian ad-tech players built around context and consent rather than data shortcuts,” he said.

For some industry leaders, the ruling marks a philosophical inflection point as much as a tactical one. Rajiv Dingra, Founder and CEO of ReBid, framed the decision as a reset of acceptable data practices. “This ruling isn’t anti-advertising; it’s anti-unconsented surveillance. In practical terms, it weakens Meta’s ability to freely merge WhatsApp data with Facebook and Instagram for ad targeting unless users explicitly opt in,” he said.

Dingra said this directly affects performance marketing mechanics. “That reduces the depth of behavioural signals available for targeting, attribution, and optimisation, especially for performance campaigns that relied on cross-platform identity stitching,” he said. As a result, he expects partial budget reallocation. “Some performance spend may move away from highly personalised Meta campaigns toward platforms and formats that are either less dependent on cross-platform user data or are built around explicit first-party consent.”

He pointed to likely beneficiaries. “Google Search and YouTube, retail media networks, publisher-led contextual ecosystems, and platforms with strong logged-in first-party data models stand to gain,” Dingra said. Strategically, he added, brands will be forced to invest in owning consented data rather than outsourcing identity to platforms. “This ruling nudges India’s ad ecosystem from surveillance-driven efficiency to consent-driven accountability.”

Public policy experts caution that the shift cannot be viewed in isolation from India’s broader data protection framework. Sourya Banerjee, Associate Director, Public Policy Communications at Jajabor Brand Consultancy, said the order essentially operationalises standards already embedded in the DPDP Act. “If we have to ensure that personal data, especially when used for advertising and profiling, must be purpose-limited and must require explicit consent for each specific instance of its use, and Meta would need to secure consent before it can allow advertisers to run ads on WhatsApp, it would drastically increase the cost of compliance which will get pushed on to advertisers,” he said.

Banerjee noted that smaller brands are already under pressure. “Smaller brands are already reeling from the impact of the DPDP Act and trying to re-calibrate their spending. This may see a slight panic exodus to other platforms,” he said, while adding that the shift may stabilise over time. “While it may impact costs, I do not expect brands to move away from something which works.”

In the short run, however, Banerjee expects tactical reallocations. “There would be immediate reallocation to platforms which can proactively prove to brands that they can secure and manage consent without increasing a compliance or financial burden on the brands. If they play it right, in the short run everything from influencers to YouTube and Google search may stand to gain,” he said.

From a technology perspective, the ruling accelerates changes that were already underway. Dhiraj Udapure, CTO of SCS Tech India, said the decision fundamentally alters India’s digital advertising mechanics. “Short-term, it shrinks signal volume for hyper-targeted campaigns, hikes compliance costs, and prompts budget shifts from Meta’s data-intensive products to search, e-commerce marketplaces, telcos, BFSI, OTT platforms, and retail media with strong first-party data and logged-in consent frameworks,” he said.

Udapure said marketers will adapt by fast-tracking first-party data strategies. “CRM integration, loyalty programs, explicit WhatsApp Business permissions, and consent management platforms will become central, with a pivot from surveillance-style precision to contextual, cohort-based, and high-intent targeting aligned with DPDPA,” he said. While brands may see initial ROI pressure, he believes the long-term outcome is healthier. “This consent-first era turns compliance into a competitive advantage, rewarding relationship-led media over volume reach.”

For Meta itself, the stakes are particularly high. Rohit Haldankar said conversational AI and click-to-WhatsApp ads sit at the core of Meta’s India growth story. “This new NCLAT ruling will hurt Meta’s click-to-WhatsApp ads ecosystem in a big way. It hits at the heart of their growth engine,” he said. Haldankar warned that weakened data capabilities will eventually affect targeting quality.

“Now that WhatsApp user data can’t be used for advertising without explicit user consent, it will weaken Meta’s data capabilities, which will eventually hamper their ad targeting. This news is bad for brands and is even worse for Meta,” he said, adding that Google could also face scrutiny given its own cross-platform data practices.

At the same time, he acknowledged the ethical dimension. “Using user data from one platform to serve ads on another platform without explicit user consent is unethical and violates the user’s trust and privacy,” Haldankar said.

Legal lens: why this is not a grey zone anymore

Backing industry concerns around weakened targeting and data leverage, legal experts say the NCLAT has left little ambiguity on how far Meta can go in integrating WhatsApp data into its advertising stack.

Akshayy S. Nanda, Partner at Saraf and Partners, said the clarification decisively limits Meta’s ability to rely on default or loosely framed permissions for advertising use. “The ruling makes Meta’s use of WhatsApp data for advertising contingent on strict compliance requirements. Any non-essential collection or cross-use, including advertising, can occur only with the user’s express and revocable consent. Meta cannot rely on vague or default consent for data sharing related to its ad stack,” he said.

This directly undercuts the feature-led consent logic that has historically powered formats such as click-to-WhatsApp ads. Nanda noted that the tribunal implicitly rejected the idea that optional features dilute consent obligations. “Regardless of whether data sharing occurs via regular features or optional features, users must be provided optionality at any stage to opt in or opt out. Consent must be express, informed, and revocable,” he said.

The clarification, he added, carries binding force. Issued to correct a mismatch between the tribunal’s findings and its operative directions, it reinforces that WhatsApp cannot assert open-ended rights over user data. As a result, Meta may be compelled to redesign internal data governance between WhatsApp, Facebook, and Instagram, with granular, purpose-linked consent driving each data flow.

Crucially for advertisers, Nanda warned that vague or incomplete consent disclosures around WhatsApp-linked advertising could trigger fresh scrutiny. “If privacy policies or consent screens fail to clearly link data types to specific advertising purposes, it would contravene the clarified remedial directions and expose Meta to further regulatory action,” he said.

Taken together, the industry view suggests that the NCLAT ruling will not cause an overnight collapse of WhatsApp-led advertising, but it will steadily erode the assumptions that made it frictionless. For brands and marketers, the adjustment ahead is less about abandoning performance marketing and more about rebuilding it on consent, intent, and trust, even if that means higher costs and slower scale in the short term.