India launches antitrust investigation against Google over payments app
What's the story
The Competition Commission of India (CCI) on Monday ordered a probe against tech giant Google over alleged abuse of its dominant position in its app store to promote its payments service. The CCI is investigating a complaint that was filed in February earlier this year. The anonymous complaint had listed six allegations, out of which, four have been rejected while two will be investigated.
Investigation
Which aspects of allegations will be investigated?
According to a Monday order, the CCI said it would review the allegations that Google promotes Google Pay while setting up an Android smartphone and whether phone vendors have a choice to avoid this. It will also probe if the Play Store's billing system is designed "to the disadvantage of both i.e. apps facilitating payment through UPI (Unified Payments Interface), as well as users."
Information
CCI rejects probe on four counts
The CCI noted that complaints related to search manipulation to favor Google Pay; prominent placement of Google Pay on Play Store; search advertisement manipulation on Play Store; and exclusivity requirements imposed by Google do not warrant an investigation.
Order
Two allegations will be investigated in detail, says CCI
The order stated, "The Commission is of the prima facie view that the Opposite Parties (Google) have contravened various provisions of Section 4 of the Act (Competition Act, 2002)." Section 4 of the Competition Act pertains to the abuse of dominant market position. The order added, "These aspects warrant a detailed investigation," directing the Director General (DG) to probe alleged anti-competitive practices.
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App developers raise concerns over Google's high commission
In fact, Indian app developers have raised concerns over Google charging 30% commission on paid apps and In-App Purchases (IAPs). Several developers have said that the internet giant cannot compel domestic app developers/owners to sell digital services by compulsory use of its billing system.
Google's response
GPay operates in extremely competitive environment: Google
Meanwhile, a Google spokesperson said in a statement on Monday evening, "We are pleased that the CCI has rejected several claims made by the anonymous complainant." The spokesperson said Google was confident the CCI will find that Google Pay operates in an extremely competitive environment, maintaining that GPay is successful as it offers users a simple and secure payments experience.
Quote
'Numerous app distribution channels on Android; users choose Play Store'
The spokesperson said, "Numerous distribution channels exist for apps on Android platform; Play isn't the only app distribution option for Android. Users choose Google Play because we ensure a safe, secure, and seamless experience." They added, "Play's billing system is a fundamental part of meeting this user expectation and helps ensure our continued investment in the many important things needed to make developers successful."