CCI sends letter to 17 startups seeking their views on Google’s dominance

Soon after initiating an investigation against Google over allegations of abuse of dominance, the Competition Commission of India or CCI has written to 17 startup founders in India and sought their views on the matter.

According to a Mint report, the list of startups that have received letters from CCI includes Paytm, Zomato, PhonePe, UpGrad, Dream11, GOQii, Razorpay and Matrimony.com.

Entrackr has independently verified the letter sent by CCI to the above startups. Three founders also confirmed the issues raised by CCI in the letter, but they did not wish to be named given the sensitivity of the matter.

“CCI has prepared 20 questions ranging from the difference in app development on Android and other operating systems to challenges faced by them in developing and listing applications on Android. It also asked companies about what they think about apps’ removal policy of Android,” said one of the founders who received the letter from CCI, on condition of anonymity.

“CCI has also asked about the kind of partnership startups have with Play Store and possible repercussions on the ecosystem in case an ‘abuse of market dominance’ is established,” the person added.

The development comes a month after Indian startups raised their concerns over Google’s policy to enforce 30% tax on apps that sell digital goods within Google’s Play Store from September 30, 2021. Paytm founder Vijay Shekhar Sharma along with 40 other leaders of the Indian startup ecosystem, who are in the list of CCI letter, have also met MeitY secretary Ajay Sawhney virtually to highlight the matter in October.

On Monday, CCI had ordered an investigation against Google over allegations of abuse of dominance in a complaint filed in February by an unnamed informant. The competition watchdog ordered a probe by its investing arm Director-General for forcing app makers to use Google Pay for in-app purchases via Play Store and favouring the UPI-based digital payments platform over other competing apps for its billing system.

“We are pleased that the CCI has rejected several claims made by the anonymous complainant. On the remaining concerns, first, we are confident that the CCI will find that GPay operates in an extremely competitive environment, and owes its success to its ability to offer consumers a simple and secure payments experience…,” said a Google spokesperson.  

Soon after the protest by startups, Google extended the deadline to integrate the billing system to March 31, 2022. Google had clarified that more than 97% of developers with apps on Play Store already comply with the policy and the new policy only applies for less than 3% of developers with apps on the download store.

According to media reports, Google held an industry meet with Indian app developers and founders of startups regarding its Play Store policy. On the other side, several startups founders also met IAMAI, an industry body for startups and Internet companies, to evaluate legal options as well as approaching regulators such as the RBI and CCI against Google over its policy.