The Competition Commission of India on Friday ordered a probe into Google’s Users Choice Billing system over the Play Store policies. The commission observed that it is of the prima facie view that Google has violated the provisions of Section 4(2)(a), Section 4(2)(b), and Section 4(2)(c) of the Act, as elaborated as supra, which warrants detailed investigation into the matter.
The commission has directed the Director General (DG) to conduct an investigation, complete it and file a report regarding the same in 60 days.
“In view of the foregoing, the Commission is of the prima facie view that Google has violated the provisions of Section 4(2)(a), 4(2)(b) and 4(2)(c) of the Act, as elaborated supra which warrants detailed investigation. Accordingly, the Commission directs the Director General (‘DG’) to cause an investigation to be made into the matter under the provisions of Section 26(1) of the Act. The Commission also directs the DG to complete the investigation and submit a consolidated investigation report within a period of 60 days from the date of receipt of this order.”
Earlier this month, Google delisted several prominent apps by ten Indian developers from its marketplace Play Store for “non-compliance with billing policies”.
The delisted apps include Bharat Matrimony, Telugu Matrimony, Tamil Matrimony, Marathi Matrimony as well as Matrimony.com’s Jodii and People Group’s Shaadi.com as well as dating apps Truly Madly and QuackQuack. Vernacular video-streaming platform Stage, Balaji Telefilms’ Altt and audio streaming and podcast app Kuku FM were also removed.
It reinstated the apps after the companies complied with its policies.
Today’s order was passed after a plea was filed by a bunch of startups who alleged that Google had violated CCI’s earlier order asking the company not to restrict app developers from using third-party billing or payment processing services to purchase apps or for in-app billing on Google Play.
Google Play Store imposes a 15-30 per cent fee for in-app purchases and subscriptions for those using Google’s billing system. Developers who choose its third-party billing option pay a commission of 11-26 per cent, marking a reduction of 4 per cent on the service fee.
In its 21-page order, the regulator stated that Google has claimed that the service fee has been charged for a multitude of services provided by Play Store to app developers. If the fee is for the services rendered to app developers, then the reasoning given by Google does not appear to be reasonable, the watchdog noted.
Further, it said the issue assumes importance in view of the fact that various physical delivery apps are very large in size and yet do not contribute towards recoupment of Google’s investment in Play Store (as claimed by Google).
“Extending this further, it is not clear as to why consumption-only apps have been allowed relaxation when their content is consumed within the app. On the whole, the applicability of service fee seems to be arbitrary and discriminatory,” the CCI said.
