The CCI Orders Probe into Google’s In-App Billing Policy
The Competition Commission of India (CCI) has recently ordered an investigation into Alphabet Inc’s Google over its in-app billing system. This move comes in response to an ongoing dispute between Google and local Indian startups regarding the implementation of Google’s policies, which the CCI claims to be “discriminatory.”
The Background of the Dispute
For several months, Indian startups have been at odds with Google over the fees charged for in-app payments. The disagreement reached a tipping point when Google removed over 100 Indian apps from its app store due to billing violations. However, following intervention from the Indian government, these apps were eventually restored.
The startups involved in the dispute requested the CCI to investigate the matter, alleging that Google was not adhering to the earlier antitrust directive that prohibits the company from taking adverse measures against companies using alternate billing systems.
Google’s Response and the CCI’s Order
In response to the CCI’s order, a Google spokesperson stated that the company is examining the investigation order and will cooperate with the process. Google maintains that it charges fees for in-app payments to support investments in the Google Play app store and the Android mobile operating system, ensuring their distribution remains free.
The CCI has directed its investigation unit to complete the probe within 60 days. Their objective is to determine whether Google’s policies are indeed discriminatory in nature.
The Core of the Dispute: In-App Payment Fees
The main point of contention between Google and Indian startups revolves around the fees imposed on in-app payments. Google currently charges a fee of 11% to 26% for these transactions. However, Indian antitrust authorities have ordered Google to dismantle the existing system and reduce the fees to a range of 15% to 30% by 2022.
Google denies any wrongdoing and argues that the fees are necessary to support investments in their app store and mobile operating system. They claim that these investments ultimately benefit users by providing them with free access to these platforms.
Conclusion
The CCI’s decision to investigate Google’s in-app billing policy highlights the ongoing dispute between the tech giant and Indian startups. The investigation will determine whether Google’s policies are discriminatory, and the probe is expected to be completed within 60 days.
As the investigation unfolds, it remains to be seen how this dispute will impact the relationship between Google and the Indian startup ecosystem. Both parties will need to find common ground to ensure a fair and mutually beneficial environment for all stakeholders involved.
