India's prominent internet firms including Shaadi.com and Matrimony have welcomed the Competition Commission of India (CCI)'s March 15 order that initiated an investigation into Google's contentious new app billing policy.
Shaadi.com founder Anupam Mittal said that CCI's latest order is a "vindication not just for People Interactive (which operates Shaadi.com) but for the global Internet industry".
"While the matter remains under investigation, it is heartening to see CCI take a strong prima facie stand not just in the interest of industry and consumers but also against Google about spinning false narratives around CCI’s earlier orders. CCI is emerging as our Krishna in this Mahabharata of righteousness," he said.
Matrimony founder Murugavel Janakiraman also welcomed the order, saying the move is in the "right direction", although he also noted that they are awaiting the final order and the interim relief order is still awaited.
"I think the interim order is expected...We hope that Google stops abusing its monopoly, making startups pay 15-30 percent. User choice of billing is a monopoly. This is what we have been fighting for," Janakiraman said.
He also said that the government is understanding the implications of big tech's business practices through the draft digital competition bill that released earlier this week.
"The way the current things are happening, it may not be enough to control the big tech companies. Globally, if companies abuse their monopoly, then they are charged 10 percent (of the overall turnover). The Indian government has also made those changes. So, it looks like we are in the right direction," Janakiraman said.
Meanwhile, a Google spokesperson said in a statement that the tech giant is examining CCI's order that initiated the investigation.
"The CCI has previously examined our service fee in detail between 2020 and 2022 and found no illegality. However, we take our commitment to comply with local laws and regulations in India seriously and will cooperate with the process in every way," a Google spokesperson said in a statement.
These comments come hours after the CCI passed an order stating that Google's new payment policy that allows developers to offer an alternate billing system for in-app purchases alongside Google Play’s own billing system.
If a user pays through the alternative billing system (also termed as user choice billing system), the transaction will still be subjected to a service fee, but at a four percent rate reduction.
This effectively means that developers will have to shell out a service fee to Google ranging from 11-26 percent for in-app purchases and subscriptions, depending on the type of app/service and the annual revenue it generates on Google Play, as compared to the regular 15-30 percent service fee.
In May 2023, Google had claimed that the new payment policy is compliant with CCI's October 2022 order that had directed the tech major not to restrict app developers from using a third-party billing system among other things.
Several local Internet firms including Shaadi.com, however, disagreed and had sought the suspension of this policy. In May 2023, CCI had stated that it would inquire whether the policy complies with its October 2022 order.
In its order on March 15, CCI said it is of the "prima facie view that Google has violated the provisions of Section 4(2)(a), 4(2)(b) and 4(2)(c) of the (Competition) Act".
The order mentioned that Google has imposed unfair price in violation on app developers. "It appears that such imposition results in app developers having fewer resources to enhance or develop their app offerings, thereby constraining the growth of the app market," the order read.
The antitrust regulator has also observed that Google's behavior curtails the freedom of app developers to select their business model and user engagement method.
CCI's order came on heels of Google delisting over 100 apps of Indian app developers including Matrimony, Info Edge (which runs Naukri, 99acres, and Jeevansathi), Shaadi.com, and Kuku FM from Play Store for not complying with the company's app billing policy for an extended period of time on March 1.
On March 5, Google said that it is temporarily reinstating these apps on the Play Store. However, the company stated that it will begin invoicing its full applicable services fees in the interim but is extending the payment timelines for these companies as they work towards finding a solution to the contentious payment issue.
(Maryam Farooqui and Aihik Sur contributed to this story.)
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