The competition regulator ordered an investigation against Google on Friday for suspected anti-competitive practices regarding its pricing policy on the Play Store.
The Competition Commission of India (CCI) said that the informants were primarily concerned about Google’s revised payment policies related to its proprietary app store, Google Play Store, which is alleged to breach competition laws.
It is claimed that these payment policies are affecting various stakeholders, including app developers, payment processors, and users.
The watchdog initiated the investigation after finding prima facie evidence that Google may have violated Section 4 of the Competition Act, which deals with abuse of dominant position.
App developers have to adhere to Google Play Store’s payment policies to distribute their apps, including using Google’s payment processing system and paying a commission. Previously, these policies were found anti-competitive. In September 2022, Google introduced the ‘User Choice Billing’ pilot, allowing alternative billing systems alongside its own.
However, concerns persist that Google’s updated policies are allegedly discriminatory and unfairly favor its own apps while burdening some developers disproportionately with excessive fees, the order noted.
In its 21-page order, the regulator observed that Google charges a service fee for multiple services provided by the Play Store to app developers. However, the reasoning provided by Google for this fee doesn’t seem reasonable, according to the watchdog.
Moreover, the CCI stressed the significance of the issue, particularly noting that many apps requiring physical delivery are substantial in size but don’t contribute to recouping Google’s investment in the Play Store.
The CCI further raised concerns about why certain apps, primarily consumption-only apps, have been exempted from these fees, terming the applicability of the service fee as arbitrary and discriminatory.
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 fees seems to be arbitrary and discriminatory, the CCI said.
