The parties are considering taking a legal action against Google for allegedly imposing excessive fees on sales of digital goods via the Android Play Store
On 27 February, startup founders and industry stakeholders congregated and decided to explore legal avenues, including filing a complaint with the CCI
The startups also stated that Google is practising discriminatory pricing, which would affect market competition
Indian startups, along with app developers, are mulling to take legal action against tech giant Google for allegedly imposing excessive fees on sales of digital goods via the Android Play Store.
On 27 February, startup founders and industry stakeholders congregated and decided to explore legal avenues, including filing a complaint in contempt with the Competition Commission of India (CCI), asserting that Google’s third-party billing policy violates CCI order. Besides that, startups will also approach the court and the Indian government, sources told Mint.
As per Google’s new alternative billing policy, the tech colossal charges a 15% fee on startups and developers, earning less than $1 Mn in revenue annually, for using its billing systems for any payments on mobile apps. While others, who do not fall under this bracket, are charged 30% by Google.
Irrespective of this, users (app developers and startups) that choose third-party billing are being levied 11% and 26% fees respectively by Google, sources said.
The startups also stated that Google is practising discriminatory pricing, which would affect market competition.
“Google Play’s service fee has never been simply a fee for payment processing, and even when a user chooses an alternative billing system, developers receive significant value from Google Play and Android,” a Google spokesperson told Mint.
For the uninitiated, Google updated its app store policy in January 2023 to adhere to the CCI order, which found the tech colossal abusing its dominant position subject to its app policies and imposed an INR 936.44 Cr penalty for this.
Following this, in February, the US-based tech giant extended its alternative billing system to all developers in India thus, giving them the ability to offer alternative billing options to their mobile and tablet users in the country.
It further shared that if a user pays via Google’s alternative billing system, then Google Play service fee will be decreased by 4%.
The development comes a week after Alliance of Digital India Foundation (ADIF) stated that it would explore legal avenues to challenge Google’s alternative billing policy.
It termed the tech giant’s policy another blatant attempt to breach the competition watchdog’s order on antitrust ruling on Play Store policies.
Before that, video game maker Epic Games also approached the National Company Law Appellate Tribunal (NCLAT) in New Delhi, accusing Google of not adhering to the CCI’s order.
Epic Games stated that Google’s Play Store is not hosting its app thus, breaching the CCI’s order by not onboarding third-party apps on its app store and disallowing users to install other apps through sideloading.
In October 2022, the competition watchdog imposed a total penalty of INR 2,274 Cr on Google in two separate cases relating to Google’s anti-competitive practices. A fine of INR 1,337.7 Cr was penalised on Google in the Android devices case while, a penalty of INR 936 Cr was imposed on the tech giant for its one-sided Play Store policies.
