It is a tumultuous time for big tech companies, as governments around the world (especially the US) have come to the realisation that they hold too much power, and need to be kept in check. The biggest example of this awakening is probably the lawsuit filed by the US Department of Justice, against the tech giant Google, over breach of antitrust laws. However, US is not the only country taking the fight against these companies, as the Competition Commission of India (CCI) has registered an antitrust case from unknown informants, accusing the search giant of misusing its app store monopoly to promote its own payments platform (again!).
The announcement from CCI holds the search giant potentially accountable for violating various provisions under Section 4 of the Competition Act, 2002, that mainly states “no enterprise shall abuse its dominant position”.
The announcement reads, “The Informant has alleged that Google, through its control over the Play Store and Android Operating System (OS), is favoring Google Pay over other competing apps, to the disadvantage of both i.e. apps facilitating payment through UPI, as well as users. As per the Informant, this amounts to an abuse of its dominant position by Google in violation of various provisions of Section 4 of the Act.”
The unknown informant has further stated to CCI that the company mostly promotes Google Pay during the setup of an Android smartphone, and by altering searches on the Google play store app to favor Google Pay.
“[The Informant has alleged that Google is abusing its dominant position in the markets for licensable mobile OS for smart mobile devices and app stores for Android OS by:] pre-installing and prominently placing Google Pay on Android smartphones at the time of initial set-up resulting in a “status-quo bias” to the detriment of other apps facilitating payments through UPI as well as other methods of payment, such as mobile wallets, net banking, etc.”
“[The Informant has alleged that Google is abusing its dominant position in the markets for licensable mobile OS for smart mobile devices and app stores for Android OS by:] rigging its featured app lists to include Google Pay in categories, such as “Editors’ Choice Apps”, “User Choice App of 2018” and “#Top Free app” demonstrating clear bias in favour of its own app,” the announcement said.
The opposition has also accused the company of taking advantage of the Play Store’s billing system to promote Google Pay. Developers on the Play Store are required to adhere to Play Store’s payment system if they want their app to be listed on the platform. The informant says that this payment system promotes Google Pay over other payment services.
Moreover, the informant also accused the search giant of imposing unfair terms on users using Google Pay. It said, “[Google] imposes unfair terms on users by requiring them to use Google Pay which is not in compliance with the data localization directive issued by Reserve Bank of India and the guidelines issued by NPCI.
In response, Google claimed that Android is not as dominant as claimed by the informant, and it rather faces significant competition from other feature phone operating systems. However, Counterpoint, a research firm, claims that Android is booted on almost 99% of the smartphones in India. The company also rejected all the accusations made by the unknown informant in relation to Google Pay, according to CCI.
This is not the first time such a case has been filed against Google Pay in India for misusing its monopoly. Earlier this year in May, the CCI questioned Google over similar allegations of misusing its market domination to promote its payments app over others.
