NEW DELHI, Oct 25: The Competition Commission of India (CCI) on Tuesday fined Google ₹ 936.44 crore on Tuesday. It was the second fine by the CCI on Google in less than a week, taking the total penalty to ₹ 2,274 core, for misusing its dominant position about Play Store policy and ordered the tech giant to stop engaging in unfair commercial practices.
After yet another antitrust probe this month, the US tech firm was found guilty of abusing its dominant market position to promote its payments app and in-app payment system, according to the CCI. The CCI tweeted it fined Google for anti-competitive practices in relation to its Play Store policies.
This comes after the CCI fined Google on Thursday Rs 1,338 crores for alleged anti-competitive practices over the monopoly of Android operating system. App stores are required for developers to distribute their apps to end users, and the availability of app store(s) is directly related to the operating system (OS) present on a smart device.
From an understanding of the market dynamics for mobile operating systems available for licencing in India, Google’s Android OS has successfully reaped the benefits of indirect network effects. The CCI said the Android mobile ecosystem’s primary software distribution channel is Google’s Play Store, which enables its owners to profit from the apps released to the market.
According to Google’s Play Store policies, app developers must exclusively use Google Play’s Billing System (GPBS) to accept payments for apps distributed or sold through the Google Play Store and for some in-app purchases.
Additionally, app developers cannot include wording that encourages users to buy the digital item outside of the app or include a direct link within an app to a website that accepts an alternate payment method, called the anti-steering provisions.
According to its evaluation, the Indian watchdog concluded that Google dominated the Indian markets for app stores for Android smart mobile OS and licensable OS for smart mobile devices, forcing app developers to use the GPBS was unfair and arbitrary.
The enormous pool of prospective customers who use Android would be lost if the app developers did not go by Google’s policy of using GPBS and were not allowed to advertise their apps on the Play Store, which the CCI said lacks any real economic reason to need GPBS usage to access the Play Store for premium apps and in-app purchases.
The option to choose a preferred payment processor from the open market is taken away from the app creators, added the watchdog. Google is yet to comment on the latest penalty.
After the fine by the CCI last week, Google had said the penalty was “a major setback for Indian consumers and businesses” and that the firm would review the decision to evaluate the next steps.
(Manas Dasgupta)
