CCI To Ask App Makers About Google's Payment Policy And Looking For Alternative Options If Any

by Bhaswati Guha Majumder - Jan 11, 2022 09:16 AM
CCI To Ask App Makers About Google's Payment Policy And Looking For Alternative Options If AnyGoogle Pay (Image via Twitter)
Snapshot
  • CCI is looking into Google's alleged unfair business practices with Google Pay and Google Play's payment mechanism.

    As per report, the 30 per cent fee Google charges for commercial apps and in-app purchases has caused worry among Indian app developers.

Google's problems appear to be getting worse, as India’s antitrust regulator, the Competition Commission of India (CCI) will need a detailed report from app developers explaining the impact of Google's payment policy on their balance sheet, as well as a suggestion for an alternative payment mechanism if viable, said a recent report.

CCI is looking into Google's alleged unfair business practices with Google Pay and Google Play's payment mechanism. It was also reported recently that the commission had opened a new probe into Google's alleged "abuse of dominance in news aggregation" after a complaint was filed by the Digital News Producers Association (DNPA), which promotes and protects the interests of digital news publishers.

As reported by Economic Times, the 30 per cent fee Google charges for commercial apps and in-app purchases has caused worry among Indian app developers.

One person familiar with the case, told ET: “We are in the process of gathering information from app developers on how Google’s upcoming policy would impact them. And if any modifications in the payment policy could be worked out.”

The source also stated that once the director general's investigative report is available, the subject will be adjudicated and CCI is scheduled to issue its order by the end of February this year.

Meanwhile, according to another person, the American tech giant has defended its policy before the CCI, stating that its conditions are "fair" and promote a "competitive environment" for users. The source noted that CCI is reviewing Google's submission and will seek additional information if necessary.

Additionally, according to the person, the competition authority is also looking into reports and remarks on Google's "hefty" commissions that it has received recently from various online companies, startups and over-the-top platforms.

Recently the tech behemoth moved the deadline for Indian app developers to integrate with Google Play's payment mechanism from 31 March 2022 to 31 October.

India's antitrust commission wants to resolve the Google payment policy issue first, before moving on to the case against iPhone maker and the world’s first $3 trillion company Apple, because it feels the two companies are linked by the "same conduct" and the "same developer community" that opposes their tactics.

An official aware of the plan told ET: “The Google payment policy case will set the precedent for Apple, and investigations in the former will make a lot of things clearer about policies of these platforms. Once the order in Google is out, we can draw parallels and conclude the Apple case will be easier and faster.”

According to another individual acquainted with both the cases, the antitrust regulator believes that the concept of low market share (up to 5 per cent) has no merit because the investigation is into anti-competitive practices. But Apple claimed that it is not a dominant participant in the Indian market, with a market share of 0-5 per cent and has asked the CCI to dismiss the case on those grounds.

The official said: “Investigations in the Apple and Google cases are in sync with other foreign jurisdictions like Europe. They impose certain conditions such as mandatory use of the app store payment system that is restricting the choice available to developers, which can be considered as ‘dominance’.”

Moreover, he said that as a dominant entity, the platform must remain impartial in order for competition to occur. While focusing on Apple in particular, the unnamed official also told ET that the focus of the investigation will be on whether the trillion-dollar company provides a level playing field for “your inbound and outbound sellers and developers”.

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