For India's 'digital destiny'
The global debate over app store monopolies and in-app fees has been raging for quite some time. Apple's App Store has particularly found unfavourable coverage based on reports of many disgruntled app makers who call the imposition of this so-called 'Apple Tax' an undisguised monopoly that stifles competition and innovation in the field by shutting out small, independent app developers. The Apple Tax issue has caught on to such an extent that even major tech players are weighing in as they occasionally clash with Apple over the issue. In the EU, it was Spotify that sought to bring attention to Apple's App Store pricing practices, in the US its Apple vs Epic Games, once again related to Apple's pricing practices. Even Facebook CEO Mark Zuckerberg recently took a dig at the App Store fiasco by calling the whole platform a wasted potential that is anti-innovation and competition. While it is true that Apple and Facebook have no shortage of differences which have only widened over the years, Zuckerberg's point is being echoed worldwide. All the same, many experts have noted that, in essence, the Google Play Store is pretty much the same as the App Store in many regards and should also be treated as a platform with practices that stifle competition and innovation.
As it were, Indian app makers would entirely agree with this statement. This is because the debate over app-store monopolies has finally come to India and this time, it is Google that is in the sightlines. To be clear, the entire affair started when Google recently, and without warning, removed Paytm from its app store. Later, Google clarified that it had taken this step as Paytm had violated Play Store rules on gambling as Paytm is involved in fantasy sports offerings. Not one to accept a unilateral lashing, Paytm shot back with a quick response that castigated Google for supposedly making rules that are above and beyond the laws of India and "arbitrarily implementing them". It further went on to claim that Google was mislabelling UPI cashback as an online casino. Interestingly, Paytm also claimed that Google was already engaged in similar campaigns in India. Paytm, according to the company itself, was unfairly singled out and targeted.
Now, there are calls by many app makers for India to have its own app store that does not exploit app makers. Following the recent call for Indian app makers to step up and compensate for the banned Chinese apps, this call for an Indian app store is not unexpected. What is unexpected is that Google, for whatever reason, could not read the mood of the Indian nation when it decided to go ahead and enforce the 30 per cent commission it normally charges within apps on its app store in India. The pushback was immediate and significant. Now in addition to an antitrust case regarding Google Pay, Google is now facing the ire of Indian startups who are determined to fight this fight till the bitter end, framing it as a step towards controlling their own "digital destiny". Needless to say, while Google has defended its policy and claimed that 97 per cent of apps worldwide comply with its rules, such a motivated pushback that even takes on nationalistic colours is not good for Google. Especially considering that it jeopardises Google's CEO Sundar Pichai plans to invest USD 10 billion in India in the field of startup innovations, among other things.
Ultimately, as many industry insiders put it, Google should not be fighting this fight. The longer this issue runs on, the more damage Google's local reputation will take. Companies that are perceived to be infringing on Indian sovereignty in even the smallest and most mundane sense will find themselves relentlessly targeted in the current scenario. While Google will certainly continue to face challenges by those who see its scale and influence as a cause for concern and legal control, it doesn't have to make a stand here. Apparently, Google has, at least for the time being, read the mood. It has deferred the addition of the 30 per cent in-app purchase commission till March 31, 2022. Still, it is doubtful that Google's Indian critics will see this as a sign of the company trying to play nice and are more likely to simply see this a bid to buy time that can be then spent lobbying.