CCI investigates Google for breaching fair pricing regulations once more.

by Jaswinder Kaur / 16-03-2024 / comments

India's antitrust regulator, the Competition Commission of India (CCI), has initiated an investigation into Google's pricing practices, alleging discriminatory implementation of its policies. This move adds to Google's existing legal challenges in India, particularly regarding its dominant position in the mobile operating platform market. The CCI's decision holds significant implications given its previous rulings and Google's history of disputes within the domestic app ecosystem.

In response to three appeals against Google, including one from Anupam Mittal's People Group, the CCI is scrutinizing Google's pricing model within a 60-day window. The investigation focuses on alleged discrimination between physical and digital services offered through apps on Google Play. Notably, Google imposes no charges on apps providing services like food delivery or ride-hailing, whereas digital services such as dating or music streaming platforms incur fees ranging from 11% to 30%.

Google, however, maintains its stance, emphasizing compliance with local laws and regulations while pledging cooperation with the investigation. The tech giant points out that previous CCI examinations found no illegalities in its service fee structure, despite ongoing contentions.

The CCI's action against Google isn't unprecedented. In 2022, the regulator fined Google a significant sum for engaging in anti-competitive practices through its Android operating system and Play store. Google has contested these fines, with a secondary investigation underway to assess compliance with the CCI's orders.

Experts suggest that Google's pricing practices could potentially stifle innovation within the industry, given its ubiquitous presence across Android devices. App developers, lacking significant bargaining power, find themselves compelled to accept terms dictated by Google, which may impede fair competition and inflate operational costs.

The CCI's scrutiny extends to Google's revenue-sharing model, particularly concerning 'free' apps on the Play store. While Google claims a negligible service fee from the vast majority of apps, the CCI argues that developers incur substantial advertising expenses to access Android users, hinting at an ecosystem imbalance necessitating thorough examination.

Anupam Mittal, CEO of People Group, views the CCI's order as a validation of concerns raised by industry players regarding Google's practices. The commission highlights the apparent disproportionality between Google's service fees and the economic value provided to developers, suggesting a potential abuse of dominant market position.

Moreover, recent events, including Google's suspension of numerous apps for policy violations and subsequent discussions with government officials, underscore the complexity of the regulatory landscape. Despite the Supreme Court's refusal to intervene against Google's service fees, the CCI's order reflects ongoing efforts to ensure fair competition and equitable treatment within India's digital marketplace.