India Opens Antitrust Case Against Google Over It’s Payment Application

India’s antitrust watchdog has opened an investigation into Google for allegedly abusing the dominant position of its app keep to promote its repayments provider in the world’s 2nd largest web market.

In its Monday announcement (PDF) about opening an antitrust case in opposition to Google, Indian watchdog Competition Commission of India (CCI) said it is directing an in-depth investigation into the claims of whether or not the Android maker prominently promotes Google Pay throughout the setup of an Android smartphone (and whether cellphone carriers have a choice to keep away from this); and if Play Store’s billing device is designed “to the disadvantage of both i.e. apps facilitating fee through UPI, as well as users.”

The informant, who has not been identified, alleged that in addition to Google Play Store’s billing machine favoring Google Pay app, in-app purchases for apps downloaded through Play Store are additionally mandated to support Google Pay carrier “if they favor to be listed on the Play Store” and they are required to pay a “high commission” for that.

The name for an in-depth investigation comes after the CCI concluded in its initial overview that requiring Google Pay to be used buy apps or make in-app repayments used to be an “imposition of unfair and discriminatory condition, denial of market get entry to for competing apps of Google Pay and leveraging on the phase of Google,” the watchdog said.

The informant also alleged that Google “unfairly” skews the search consequences on the Play Store in want of Google Pay app over others — although CCI is no longer investigating this claim citing not sufficient evidence to assist them. Google “rigs its feature app lists such as ‘Editor’s Choice Apps’, ‘User Choice Apps’ and ‘Top Free apps’ … demonstrating clear bias in want of its own app; by manipulating the search classified ads algorithm on the Play Store in favour of Google Pay.”

google antitrust case

“The informant pointed out similarities between the conducts of Apple in Europe and Google in India i.e. like Apple (as set out in the Press Release of EC), as a obligatory requirement for record on the Play Store, Google requires the app developers to completely use Google Play Store’s payment machine and Google Play In-App Billing for charging customers who buy apps on the Play Store or buy goods/services from inside an app (i.e. IAP), and in addition like Apple, Google costs app builders a 30% fee for permitting them to use the Play Store’s price system and Google Play In-App Billing,” the Indian watchdog said, which has directed its director generic to whole the investigation within 60 days.

Google informed CCI that Android “is not dominant in India and it faces giant competition from feature phones OSs (operating systems) as characteristic telephones bought in India these days boast the features and overall performance that the Informant attributes to smartphones. Moreover, Android is claimed to be dealing with big opposition from licensable and non-licensable OSs,” the Indian watchdog revealed.

According to research company Counterpoint, Android powers 99% of all smartphones in India. Google also disputed different allegations. For instance, it said, “Google’s 30% (and in positive circumstances, 15%) provider fee is no longer arbitrary. It is market based, legitimate, and pro-competitive as the service price approves Google to cowl third party fees and assist its enormous and persevered investments in Play, including the sizeable resources it develops for developers.”

If the allegations made by the anonymous informant are determined credible, Google’s practices should be in violation of more than a few provisions of Section four of India’s Competition Act of 2002.

Google Pay, formerly acknowledged as Tez, is one of the most popular payments offerings in India. It competes with Walmart’s PhonePe, Paytm and a vary of different apps. As of last month, Walmart’s PhonePe was slightly in advance of Google Pay in India. Both the apps for my part process roughly 40% of all transactions on UPI, a repayments infrastructure built by using massive banks in the country. UPI is the most famous digital repayments answer in India.

Google Play Store supports a vary of charge methods, such as savings cards, cell wallets, net banking and UPI. But, as the informant alleges, “UPI primarily based digital price apps are extra convenient, secured, economical, etc. over different digital charge solutions.” Based on such awesome features, the Indian watchdog said, “the Informant has averred that the market for apps facilitating fee through UPI is a separate applicable market as customers do not regard apps facilitating charge through UPI as interchangeable or substitutable with different modes of digital payment.”

The new antitrust case is the latest headache for Google in India, its biggest market with the aid of users. In latest months, the dominant position of Android has irked many startups in the country, who have formed an casual coalition to fight returned the Android maker. Following a latest backlash in India by using these startups, Google postponed the enforcement of its new Play Store billing rule in India to April 2022. To be clear, CCI is investigating the criticism that was filed in February this year, so it is no longer at once linked with any current incidents.

In a statement on Monday, a Google spokesperson instructed TechCrunch, “We are pleased that the CCI has rejected quite a few claims made by using the anonymous complainant. On the closing concerns, first, we are confident that the CCI will find that GPay operates in an extraordinarily aggressive environment, and owes its success to its potential to provide consumers a simple and impenetrable repayments experience.”

“Secondly, numerous distribution channels exist for apps on the Android platform; Play is not the only app distribution choice for Android. Users select Google Play due to the fact we ensure a safe, secure, and seamless experience. Play’s billing machine is a necessary section of assembly this user expectation and helps make certain our persisted investment in the many vital things wanted to make developers successful.”

Google is potentially going through two extra antitrust investigations in India over allegedly abusing the dominance of Android in the smart TV market, and dominance of Android in the cellular market, according to Reuters. In China, in accordance to the information agency, Google is facing an antitrust probe into allegations that it used its Android OS to stifle competition.

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