Digital Competition Law: IAMAI under fire from Indian startups for 'parroting Big Tech views'

In a draft document yet to be submitted to the Committee on Digital Competiton Law, industry body IAMAI had criticised the Finance Committee's recommendation to introduce a new law to deal with Big Tech's anti-competitive practices.

Industry body Internet and Mobile Association of India (IAMAI) is facing criticism from the Indian startup ecosystem for 'parroting views of Big Tech companies'. This criticism is particularly aimed at a draft submission prepared by IAMAI on whether the country needs a separate law for tackling Big Tech firms' anti-competitive practices.

Moneycontrol reported earlier that the IAMAI, whose members include the Indian arm of Big Tech firms such as Google, Microsoft, Twitter, Meta, and others, argued against the need for a separate Digital Competition Law, claiming that it would harm startups, increase regulatory costs, and so on.

The arguments were made in a draft document that will be submitted to the Committee on Digital Competition Law (CDCL), a body that was formed to look into the need for a separate law for competition in digital markets.

However, a few companies and personalities from the Indian startup ecosystem disagree with IAMAI's position, claiming that they support such a law and that Big Tech companies influenced the industry body's opposition. Such startups are calling for changes to be made in IAMAI.

"Unfortunately today, a Google employee is the chairperson (of IAMAI) and a Meta employee is the vice chairperson. So, it is largely influenced by the interests of the global big tech companies. For example, IAMAI did not do anything on the Google billing issue," Murugavel Janakiraman, CEO of BharatMatrimony told Moneycontrol. The company is currently not a member of IAMAI.

The Google billing issue refers to the company's announcement in October 2020 that it will begin enforcing its policy of requiring developers to use its own billing system and pay 30 percent of the sales generated as a service fee. Google faced intense backlash from Indian developers.

"Ex-ante regulations on competition in the digital ecosystem is happening the world over. It has been recognised that such regulations are required as the global tech giants are becoming monopolies," he said with regards to the issue of a digital competition law.

Janakiraman pointed out that he and five other entrepreneurs founded IAMAI in 2005 with the goal of promoting internet usage and tech entrepreneurship in India. However, he noted that over time, the association has become dominated by global giants.

Moneycontrol has reached out to IAMAI with further queries regarding the matter, and the article will be updated when a response is received.

In a tweet, Rohan Verma, CEO and executive director of MapMyIndia said, "It's distressing to know that IAMAI (Internet And Mobile Association of India) - @IAMAIForum - is parroting & promoting views that are Anti-Indian and Pro-Foreign Big Tech."

MapMyIndia was earlier a member of IAMAI, but they have not been a part of the industry body for a few years, Verma told Moneycontrol. The mapping company is financially backed by another IAMAI member, PhonePe.

Verma said that IAMAI should 'change immediately' or "IAMAI must be given no credence".

"Every country has its own trade bodies who promote their domestic companies in their domestic market & enable them internationally. Sad to see various Indian trade bodies lured by & acting on behalf of the interest of Foreign companies," he added.

Similarly, Shaadi.com founder Anupam Mittal said, "Start-ups are strongly in favour of a strong anti-monopoly Digital Act. In fact, IAMAI is failing lobby for Big Tech propaganda and misinformation... India @CCI_India and PMOIndia know better (sic)."

India Quotient's founding partner Anand Lunia also chimed into the growing voice against IAMAI and said in a tweet, "Hope @PMOIndia knows this!!!! Policymakers don't want to be seen towing to Big Tech. Hence they consult an organization pretending to represent Indian cos, IAMAI, but run by Big Tech...."

What happened earlier

The Parliamentary Standing Committee on Finance released a report in December that, in addition to recommending the creation of a Digital Competition Law, recommended classifying Big Tech companies as Systemically Important Digital Intermediaries (SIDIs) based on their revenues, market capitalisation, and end users.

It also urged Big Tech firms to provide advertisers and publishers with access to performance-measuring tools and data necessary for them to carry out independent verification of advertisements.

A few months later, in February, the government formed the Committee on Digital Competition Law, or CDCL, which was tasked with examining the "need for a separate law on competition in digital markets."

The IAMAI has prepared a draft document to be submitted to the CDCL, but sources have indicated that the document may undergo some changes before its final submission to the committee.

What IAMAI says

In the draft of IAMAI's submission to the Committee on Digital Competition Law (CDCL), which Moneycontrol has reviewed, the industry body said, "IAMAI is concerned that the recommendations in the Report (of the Parliamentary Standing Committee of Finance) are neither targeted nor proportionate."

"Lack of a well-articulated policy objective, (and) failure to adopt an evidence-based approach to identify the need for the regulation, have led to ambiguous, broad recommendations (in the report), which will stifle innovation, competition and the benefit that accrues to markets and users," the draft submission said.