[Update: Google’s statement] Google Play and Google Pay are now being investigated for market dominance in India
Technology makes our lives easier, and bigger companies make it even easier with seamless integration throughout their ecosystems. But now, across the world, the conversation has started turning towards how some technology companies may have perhaps become too big for the market. Recently, the US Antitrust Subcommittee concluded that Amazon, Apple, Facebook, and Google abused their monopoly and dominance. The Department of Justice in the USA also began an antitrust case against Google. And now in India, the Competition Commission of India (CCI) has launched an investigation against Google Play and Google Pay for their market dominance.
The news has broken courtesy of MediaNama, with information shared in a Twitter thread. The snippets highlighted are part of the order for investigation, which MediaNama has accessed.
This follows a major pushback by Indian founders against the 30% “tax” by Google on Indian companies.
A thread by @nixxin
— MediaNama.com (@medianama) November 9, 2020
Much like several other investigations across the world, the CCI investigation is looking into dominance by Google, using its dominant and monopolistic positioning in one business to unfairly prop up another of its own business to the point of shutting out competitors. Medianama states that CCI will look into these allegations towards Google’s dominance, revolving around Android and the Google Play Store, and how it is affecting Google Pay:
- Exclusivity regarding mode of payment for purchase of apps, and in-app purchases: Google’s 30% cut on all purchases made on the Android app platform is being investigated.
- Requiring OEMs to pre-install Google Pay as part of GMS on Android
- Google Play Store search manipulation and bias by Google in favor of Google Pay: Even when users search for “pay” on the Google Play Store, the first result is Google Pay, and not Paytm or Phonepe.
- Prominent placement of Google on the Play Store: Allegations made on rigging “User Choice”, “Editor’s Choice”, and “Top free apps” lists to favor Google Pay. Google Pay is also being promoted on Google Search for recharges and bill payments.
- Google prioritizes Google Pay ads on the Play Store whenever a user searches for Paytm or Phonepe. This is not under investigation, but remains an allegation.
It’s important to note that these are allegations at this stage, and the CCI will then set out to investigate these allegations. Parties to the investigation will be given opportunities to present their side, and only when the allegations are adjudged to be true, will further action be taken.
The CCI investigation comes in the backdrop of a group of prominent Indian app developers criticizing Google’s behavior on the Play Store and in India’s digital money market. This outrage, in turn, started off when Paytm was briefly removed from the Play Store for violating policies on gambling.
Update: Statement from Google
“We are pleased that the CCI has rejected several claims made by the anonymous complainant. On the remaining concerns, first, we are confident that the CCI will find that GPay operates in an extremely competitive environment, and owes its success to its ability to offer consumers a simple and secure payments experience. Secondly, numerous distribution channels exist for apps on the Android platform; Play is not the only app distribution option for Android. Users choose Google Play because we ensure a safe, secure, and seamless experience. Play’s billing system is a fundamental part of meeting this user expectation and helps ensure our continued investment in the many important things needed to make developers successful.”
We will have to wait and watch how this unfolds.