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Business News/ Companies / News/  'If Google is not there…': Shaadi.com founder Anupam Mittal weighs in on Play Store billing row
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'If Google is not there…': Shaadi.com founder Anupam Mittal weighs in on Play Store billing row

Google is facing protests from Indian startups over its Play Store billing system, which charges a 30% fee for using their payment system. Shaadi.com founder, Anupam Mittal, believes Google's attempts to dominate the Indian economy will have negative consequences for the company.

Anupam Mittal, shark tank judge and founder of Shaadi.comPremium
Anupam Mittal, shark tank judge and founder of Shaadi.com

Google is mulling a change to its app store pricing model in response to backlash and a possible regulatory crackdown. The development comes amid growing protests from a ‘task-force’ of leading Indian startups --- mere days after the tech giant lost a suit against the makers of Fortnite. Google has repeatedly defended its efforts to ‘compete against Apple’ and insists that it is working to address ‘developer complaints’. Shaadi.com founder Anupam Mittal however believes that efforts to “colonise the Indian economy" will end badly for the company.

“Google charges us 30% under Google Play Billing System – which comes into effect if we use their payment system. If you were to use an alternative payment system you would still have to pay the company 26%. Which effectively kills every business because we are already paying anywhere between 20% and 50% to Google for advertising on their app store. If you are somebody with under a million dollars in revenue then 15% will apply. But most of the value comes from 20% of developers who deliver around 80% of the value," he explained to Livemint recently.

The new program – called ‘User Choice Billing’ – was rolled out in 2022 and allows app developers to process payments on their own. However they are still compelled to give the tech giant a slightly lower fee of 26% or 11% on subscriptions.

Mittal is one of the leading members of a 40-company task force formed to counter the Google Play Billing System. The Shark Tank judge also lashed out at ‘digital East India companies’ for their attempts to “confuse, misinform and use treachery" in order to maintain their monopoly.

ALSO READ: Fortnite maker Epic Games wins antitrust battle against Google. Here's what you should know

Google has faced numerous legal battles over its Play Store policies – with Fortnite maker Epic Games recently winning its anti-trust trial. This came mere weeks after it settled anti-trust allegations brought by US state attorneys general and days after it resolved a case being pursued by Match Group. The company which owns Tinder and other online dating services is now receiving a refund of $40 million in fees and adopting Google's ‘user choice billing’ system as part of its settlement.

“We are currently paying 4% as an interim measure following a Madras High Court order. This says GPBS or UCB cannot be implemented till the HC delivers its final verdict. Until that is resolved we are paying 4% as an interim arrangement. I’m fairly confident that either this judgement or CCI (or both) will rule in our favour. And either way that 4% will have to be returned to us," added Mittal.

He hailed the recent verdict as “truly epic" in many ways for recognising Google’s “complete abuse of monopolistic power".

ALSO READ: ‘High Sugar Dessert Store’: Shark Tank India's Anupam Mittal criticises Starbucks

Documents accessed last month by Bloomberg indicate that Google created Project Everest in 2021 to reconsider its Play Store billing model. The proposal to charge a set fee per app was eventually abandoned after it became clear that the move could cost Google billions of dollars. Data indicates that the Play Store brought in $14.66 billion in revenue, with gross profits of $11.44 billion in 2020 --- numbers that the company insists does not account for costs associated with improvements to Android.

Use of the popular operating service – seen in 70% of smartphones around the world --- is given away for free by Google. Smartphone makers and carriers however sign an all-or-nothing deal to pre-install a bundle of Google programs in order to use its Play Store. The agreement requires the app to be installed on the home screen, and blocks users from deleting it.

“Companies are already paying a big chunk of their revenue to Google because of all the underhanded stuff it does. And now you will pay up to 30% and mess up the user experience…effectively you won’t be able to compete. All your margin is gone there. It is the equivalent of the British lagaan where the local domestic population or companies cannot prosper and whatever is generated…most of it goes to the coloniser. That’s effectively the long term-outcome if we allow this to continue," the Shaadi.com CEO reiterates.

Several countries – including Korea – now require the company to open its app stores to other payment systems. New European Union rules set to come into effect in March will also require Google and Apple to open up their stores.

ALSO READ: Big Tech Braces for Wave of Antitrust Rulings in 2024

Mittal believes that it is “only a matter of time" before the tech giant finds itself paying millions of dollars in fines. He also bats for provisions that would essentially ‘block’ Google usage within the country if they continue to abuse Indian laws.

“The reason it has become so large is network effects and misuse of power. If Google is not here…it will be a matter of weeks before alternative services come up. And you will not even miss it. If we can build an ONDC for ecommerce…why can’t we build an ONDC for apps? Just look at Indian entrepreneurs! Complexity does not equate to difficult or impossible," he assures.

ALSO READ: Google, accused of tracking private browsing user data in ‘Incognito’ mode, settles $5-billion lawsuit

Similar concerns have also been voiced about Apple, with the Competition Commission of India (CCI) ordering a detailed probe in 2021 over its allegedly anti-competitive App Store policies. The other company however holds a significantly smaller market share of 6% at present. Mittal also notes that Apple polices are imposed within its own “device ecosystem".

“While some aspects of the current case will apply to the Apple…there are certain differences. Google is imposing these things while licensing the Android operating system to other device manufacturers. So, it is effectively engineering its own monopoly by undertaking deals that ensure competition cannot enter," he said.

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Published: 03 Jan 2024, 03:38 PM IST
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