Moneycontrol Pro Panorama | Private goods or public, where to draw the line?

How do we the people, the government, businesses of various stripes and the law see as public goods?

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The Panorama newsletter is sent to Moneycontrol Pro subscribers on market days. It offers easy access to stories published on Moneycontrol Pro and gives a little extra by setting out a context or an event or trend that investors should keep track of. 

A week ago, you may have seen the heart-tugging video of a farmer being denied entry into a Bengaluru metro station by the security staff, ostensibly because they felt his clothes were not “clean enough”. The emotive connection we have to farmers, the farmer’s stoic response to the injustice, fellow commuters arguing on his behalf – even if one did not understand Kannada, it was moving. The security person who stopped his entry lost his job apparently, but was there an unwritten policy that he was enforcing?
Does the metro explicitly give right of entry to anyone who has a ticket and is not carrying any prohibited substance?

If the farmer gained entry but commuters prevented him from entering the coach, how would this issue have played out? Do commuters have that right? In Mumbai suburban locals, for example, it’s not unusual to see commuters sometimes prevent a fellow traveller who’s fallen on very tough days from boarding the train. No one asks them if they have a ticket even. Do they have a right to do that?

Several decades ago, Mumbai’s first mall opened in Tardeo. While it was tiny compared to today’s malls, it was a novelty and in space-starved Mumbai, it was a magnet for those looking for something different to do. But the mall had high-end brands in it and what it wanted was the moneybags who could spend and not window shoppers. It said only those with credit cards -- Internet says a mobile phone was also acceptable -- will be given entry. There was a hue and cry, understandably, over this denial of entry to what was perceived as a public destination. Eventually, the mall authorities revoked this rule. Is the mall a public place and can authorities deny entry?

But consider this question. If you wear a T-shirt or some other clothes advertising a product and walk around a crowded mall, will it be allowed? Or if you carry some goods with you, and attempt to sell them? The cases of people who fought for a right to bring food into the mall or cinema theatres have already been settled. The businesses can prohibit it. Why is that water that is sold for Rs 20 outside can be sold for Rs 30 in a mall or Rs 100 in an airport? Is the subterfuge of saying ‘Specially packed for…’ enough to charge a premium?

Now, airports are public transport places, just as a railway station or a metro station. Consider this. You can, thankfully, take your coffee into the airport. Now, let’s say you take a big flask of coffee into the airport, have your cuppa, then park yourself near the shop that’s selling coffee for Rs 350, and start offering cups for Rs 100 till it lasts. Will the shop tolerate it, will the airport tolerate it? The answer is a definite no.

These may seem unconnected issues, but it deals with the perception of how we the people, the government, businesses of various stripes and the law see as public goods. The issue has acquired a new impetus after a clutch of apps were removed from the Google Play store for violations of its terms of service. The store’s requirement was that it should get a share of all purchases made in-app, but the app developers’ contention is that these charges are too high. They would like to pay less or preferably nothing, after all it’s an open source system Android on which the store is built.

When these apps were free, these issues did not really matter. But then nothing is really free. We learnt to our horror (not that we did anything about it) that we were the product, that either served as a bait for advertising or for startup valuations. Should we have got a share of revenues or a share of the valuation spoils?

But to share revenue on an in-app purchase or not is similar to a store with a revenue-sharing arrangement with a mall owner saying that a store-pickup of an online purchase is not eligible for a share. But what happens when the store encourages you to buy online from within the store, using your online account, as happens at several stores nowadays when you don’t find a size or colour? And it’s then shipped directly to your residence. Does that qualify for a share to the mall or not?

What these examples aim to show is that what is a public good is undergoing a transformation of sorts, especially as the government outsources public infrastructure, or gets private contractors to build them, and seeks to make them self-sustaining. The net effect is that public goods and commerce are blending into one where depending on where we stand, we view them as one or the other.

If taxis are a public good, are privately-held ride-hailing taxi services also a public good? If it was unfair for black and yellow taxis to ask for more fare during peak hours, why is it fair for them to do that? Can they choose to be a public service when it suits them -- parking bays at airports for e.g. -- and not when it suits them -- tariff fixation for example?

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