One important thing: Low-intensity IED blast rocks Bengaluru's Rameshwaram cafe; 9 injured

In today’s newsletter: 

• Google vs Indian app developers, again
• Paytm Bank fined over money-laundering violations
• Indian IT giants bet big on the chip race

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It's a deja vu moment in India's tech and startup industry today. 

Scoop: Info Edge-owned recruitment business Naukri and real estate business 99acres have been delisted from the Google Play Store. 

• This is part of Google's drive to purge apps from Indian internet firms which the tech giant said have not complied with its app billing policy for an "extended period of time"

Founder Sanjeev Bikhchandani, however, told us that they have been in compliance with Google's app policies since February 9 and have paid all the dues to the company.

Earlier today, Google said it will take action against 10 companies that have chosen not to comply with its payment policy, despite adhering to the payment policies of other app stores.

• The move follows the Supreme Court’s refusal to grant interim relief to app developers facing delisting from the Play Store last month
  
  
• The apex court is now expected to hear pleas from startups challenging Google's enforcement of its app billing policy on March 19

While Google didn't disclose specific names, apps from matrimony firms Matrimony and Shaadi.com, streaming platforms Altt, Stage, and Aha, dating apps Truly Madly and Quack Quack, audio content platform Kuku FM, and social networking app FRND have been removed from the play store.

Google said that granting a select group of developers preferential treatment over others who are already in compliance would result in an "uneven playing field" across the ecosystem, placing all other apps at a "competitive disadvantage."

• Currently, over 200,000 Indian developers using Google Play are adhering to its policies, the company said.

Also read: IAMAI asks Google not to delist apps, says 4 members affected

Several app developers have pushed back against Google's action. Matrimony founder Murugavel Janakiraman referred to it as a "dark day for the Indian Internet," while Kuku FM co-founder stated that "Google is the most evil company for businesses," and they are now faced with "no option but to accept their terms."

Bikchandani suggested that India needs a Play Store equivalent that is part of the Digital Public Infrastructure

Also Read: Indian startup founders mull levying ‘Google Tax’ amid app billing tax row

Things just aren't going well for Paytm Payments Bank!

In a massive blow to Paytm’s associate company, the Ministry of Finance's Financial Intelligence Unit-India (FIU-IND) today imposed a penalty of Rs 5.49 crore on Paytm Payments Bank Ltd (PPBL) for violating its obligations under the Prevention of Money Laundering Act (PMLA).

• The penalty stems from the bank's handling of accounts linked to illegal activities like online gambling

Earlier in the day, Paytm announced that it is terminating all partnerships with PPBL. 

This decision, while seemingly straightforward, poses significant challenges for Paytm's core operations. 

• It is quite likely that Paytm will require PPBL services beyond the March 15 deadline

The two entities are deeply intertwined, with PPBL powering most of Paytm's core businesses on the app. 

• PPBL acted as the payment service provider (PSP) bank for Paytm's UPI payments, connecting the app to the National Payments Corporation of India (NPCI) servers

With PPBL out of the picture, Paytm needs to find alternative PSPs. 

• The company has secured partnerships with Axis Bank, Yes Bank, and HDFC Bank. 

However, bankers warn that migrating to these new partners could take several months

More from our Paytm coverage:

• RBI faces criticism for Paytm action, but here’s what the regulator has done to promote fintechs 

• At least 200 meetings in last 6 months: That's RBI's engagement with fintech sphere 

• Big banks’ payment apps see jump in daily downloads since Paytm crisis; HDFC Bank’s numbers fall  

• Delhi meet sees RBI assurance of more regular, structured engagement with fintechs

The tech world is obsessed with chips!  

While headlines focus on AI advancements and the race to build the next wonder chip, a different story is unfolding behind the scenes. 

• Indian IT giants are making a strategic move, positioning themselves as the "chip-to-cloud" solution for the future

Infosys, HCLTech, Wipro, and Tech Mahindra are all capitalising on the global chip shortage and the subsequent surge in demand for semiconductor expertise.

Their strategy? 

Offering R&D and engineering services to support chip manufacturing - a one-stop shop, from design to production.

To gain a competitive edge, these IT companies have been acquiring semiconductor design and R&D firms in recent years. 

• Additionally, with the Indian government promoting domestic chip production, companies like HCLTech and Wipro are forging partnerships with global chipmakers such as Intel Foundry

However, Chip Wars author and historian Chris Miller throws a cautionary flag.

• He emphasises the need to ensure the upcoming semiconductor plants are economically viable and sustainable for long-term growth

Indian startups recorded an uptick in funding across stages in February over the same month last year, data from Venture Intelligence shows. 

• Startups saw an overall jump to $636 million across 63 deals in February, recording an uptick of about 19% from $535 million across 50 deals in February 2023

Investors we spoke to believe that the improvement in funding comes on the back of better agreement on valuations among investors and founders. While this is an early sign of a funding spring, investors continue to be cautious, with deal closures taking longer than ever. Go deeper

• Elon Musk is suing OpenAI and its CEO, alleging they breached agreements made when he helped found the company in 2015.

• OpenAI is investing in and collaborating with California-based Figure to create language-processing and reasoning capabilities using AI for their humanoid work robots.

Craving a weekend binge with a twist? 

Dive into the murky depths of truth with The Indrani Mukerjea Story: Buried Truth, a gripping exploration of the infamous Sheena Bora murder case. 

• The series offers firsthand accounts from key players, including Indrani herself. Watch it on Netflix

Or are you looking for a historical adventure with a touch of fiction?

Set sail for a thrilling saga in Shogun. This drama follows John Blackthorne, a shipwrecked Englishman who becomes entangled with the fate of Lady Mariko, a dishonoured samurai. Watch it on Amazon Prime Video

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