In light of the efforts undertaken by the Parliamentary Standing Committee on Finance to address the anti-competitive practices of big tech companies, ADIF made a representation to the esteemed committee to draw its attention to one of the many ways in which big tech companies are exhibiting anti-competitive behaviour: through the app stores.

In a letter to the committee, we summarized the anti-competitive behaviour of big tech companies running app stores and requested an opportunity to depose before the committee to share our collective concerns and learnings.

Following the representation, ADIF was invited to depose before the committee on May 19, 2022.

Below is the letter sent to the Parliamentary Standing Committee on Finance.

With respect to the recent Economic Times article related to the CCI investigation into Google over its alleged anti-competitive practices in the app marketplace, being a party to the case, ADIF wishes to refrain from commenting on the report.

As the matter is under investigation by the CCI, and given that the report or its findings have not been made public by the CCI, we are not at liberty to comment on specific matters pertaining to the case or the proceedings.

We at ADIF place our utmost trust in the CCI and stay committed to due process. As and when the CCI makes its findings/final verdict public, we would be happy to comment on the matter and share our views.

ADIF commends the CCI counsel’s counter to Google’s writ petition challenge.

During the hearing today (Jan 5), Competition Commission of India (CCI) Additional Solicitor General Venkataraman, appearing on behalf of the competition watchdog, made the submission that its investigation arm Director General (DG) has given an assurance that they will complete the ongoing investigation against Google within 60 days.

Google also confirmed to the Court its cooperation with the investigation and the withdrawal of their petition. 

ADIF is represented in this case by Abir Roy and Gautamaditya Sridhara of Sarvada Legal.

Sijo Kuruvilla George, Executive Director, ADIF said:

“Google’s consistent attempts throughout have been to implement their mandatory PlayStore billing policy and to also delay or evade any antitrust indictment. By conveying to the Court that the CCI is expected to complete their investigation in 60 days, the antitrust regulator has essentially checkmated Google’s attempt to delay the overall antitrust investigation process by exploiting legal challenges.”

The commission is of the prima facie view that such a policy is unfair as it restricts the ability of app developers to select a payment processing system of their choice. We now look forward to the CCI report that is slated to be released in 60 days as was conveyed to the high court today. 

We exhort Google to fully comply with the antitrust investigation in good faith. We also urge Google to maintain the status quo with respect to Play Store billing policy announcements until the investigation is complete. 

Founded in 2020, ADIF (Alliance of Digital India Foundation) is an industry body for India’s digital startups formed to fully capitalise on the sector’s promise with the objective of its long-term prosperity in mind. ADIF aims to transform the Indian startup ecosystem into the top 3 globally by 2030.

Among the issues ADIF is working on, we are fighting Google and Apple on their app store monopolies.

The Alliance is now 470+ members strong. Join the Alliance of Digital India to become a part of our journey to transform India’s startup ecosystem into the best in the world.

ADIF welcomes CCI’s decision to open the investigation into Apple over alleged abuse of the app market. Apple’s app store practices have been restrictive and at times even violative of rights of app owners to conduct their business. The probe by CCI comes at a time where Apple is facing scrutiny from antitrust regulators in other geographies including the US.

"Apple alongside Google has been maintaining a stranglehold on the app economy by imposing unfair rules on their respective application stores and choking innovation. There are a host of anti-competitive issues that plagues both their app marketplaces; the most vexing of them being the imposition of their own in-app billing systems on app owners: a clear case of abuse of their dominance," said Sijo Kuruvilla George, the Executive Director of ADIF.

The observation by the CCI that anti-competitive restrictions on app developers and not end-users of Apple's response is noteworthy and significant. We commend the CCI’s commitment to uphold the rule of law & its leadership in protecting the interests of Indian app startups & app owners.

Founded in 2020, ADIF (Alliance of Digital India Foundation) is an industry body for India’s digital startups formed to fully capitalise on the sector’s promise with the objective of its long-term prosperity in mind. ADIF aims to transform the Indian startup ecosystem into the top 3 globally by 2030.

Among the issues ADIF is working on, we are fighting Google and Apple on their app store monopolies.

The Alliance is now 460+ members strong. Join the Alliance of Digital India to become a part of our journey to transform India’s startup ecosystem into the best in the world.

We are terming this development and action by Google (Link) yet another delay tactic. Our application for interim relief was filed with CCI on the 6th of October. We are on the 82nd days since, nearly 3 months after, and it has to be noted that till date Google has not submitted neither their response nor any information. The only action that has been there on the part of Google so far has been requests for more time & information. 

This legal challenge by Google yet another delay tactic and an attempt to frustrate the antitrust process. It also calls into question their good faith. The only commitments that has been consistent on the part of Google throughout this entire antitrust process has been their commitment to a) delay the process in every way possible and b) protecting their super profits from the app economy abusing its dominance. We exhort Google to comply with the antitrust process in good faith and as per the directives of the CCI.

Sijo Kuruvilla George, Executive Director, ADIF    

Google in their writ petition has attempted to argue that there is no urgency citing the extension in their Play Store policy deadline. The prayer of the interim challenge is for maintenance of status quo until the CCI antitrust investigation is complete and verdict is out. It has to be noted that Google has made three major revisions related to playstore billing policy in just the last 3 months - none of which addresses the underlying issue and all of which aimed at frustrating and delaying the antitrust process.

Reluctance on the part of Google to comply with the requirements of the antitrust proceedings in a timely and upfront manner is at odds with the public posturing the company has adopted alongside their policy revision announcements that the company is making every effort in the interest of the Indian startup ecosystem and fair resolution. By adopting delaying tactics and reluctance to share information, Google is serving nothing but their own self interest. Google’s reluctance to share information even after multiple directives to that effect on CCI’s part calls into question the good faith that is expected of Google while participating in the process.

Google’s attempts to frustrate the antitrust process by refusing to share information on one side and making tweaks to their PlayStore billing on the other reeks of arrogance & abuse of dominance - making the plea for interim relief all the more prescient & urgent.  

References

• Link to writ petition filed by Google

Related statements by ADIF

• Statement | ADIF says Google’s deadline extension is a welcome interim move, calls for introspection that results in fairer policies for all app owners

• Statement | ADIF calls Google’s commission cut a deflect & distract tactic; to double down on efforts to protect fair competition and developer choices in app economy

Founded in 2020, ADIF (Alliance of Digital India Foundation) is an industry body for India’s digital startups formed to fully capitalise on the sector’s promise with the objective of its long-term prosperity in mind. ADIF aims to transform the Indian startup ecosystem into the top 3 globally by 2030.

The Alliance is now 460+ members strong. Join the Alliance of Digital India to become a part of our journey to transform India’s startup ecosystem into the best in the world.

The extension of the implementation deadline for the Card on File tokenisation by the RBI (Link) is a welcome gesture from the Central Bank. There were concerns across all stakeholders in the payment ecosystem around readiness. Merchants were also fearing payment disruptions and revenue losses as a result. The extension comes as a breather for all stakeholders. 

ADIF thanks RBI for making the extension taking into account the concerns and challenges around ecosystem readiness to make a full transition. We also call upon the RBI to take steps to ensure readiness across all banks. Should bank readiness not come through in a timely and robust manner, we stand the risk of finding ourselves in the same predicament again in June as we are in now.  

Sijo Kuruvilla George, Executive Director, ADIF    

Ecosystem readiness is a sequential process, with bank readiness being the vital first link in the chain. We urge RBI to make an assessment of readiness across all banks and make this information publicly available. Unless banks are compliant, merchants will not be able to successfully process tokenised transactions and have solutions consumer ready.  

It is equally important that consumer education and awareness is given the required importance and not just the technical aspects related to the switch to tokenisation. It is only when consumers are aware of tokenisation and its benefits, that they will be able to make an educated choice for opting in. It is also the RBI & banks that are best positioned to lead this consumer awareness drive; and it is only with informed opt-in by all or a large majority of card holders that we will be able to make an effective transition into the new tokenisation regime. 

Founded in 2020, ADIF (Alliance of Digital India Foundation) is an industry body for India’s digital startups formed to fully capitalise on the sector’s promise with the objective of its long-term prosperity in mind. ADIF aims to transform the Indian startup ecosystem into the top 3 globally by 2030.

The Alliance is now 460+ members strong. Join the Alliance of Digital India to become a part of our journey to transform India’s startup ecosystem into the best in the world.

New Delhi, December 22, 2021: The Merchant Payments Alliance of India (MPAI) and the Alliance of Digital India Foundation (ADIF) have together voiced their concerns over industry readiness on the recent Reserve Bank of India (RBI) directive on card-on-file tokenization (CoF) and have written to the Central bank requesting an extension of the December 31 deadline for implementation of card data storage norms.

While the RBI’s objective of ensuring security and reducing fraud from the payment ecosystem through this policy change is a step in the right direction, MPAI and ADIF have in their letter highlighted several operational challenges that will hinder the transition to the token-based payments ecosystem.

This policy change affects three major players: banks, intermediary payment systems, and merchants. “Merchants cannot start the testing and certification of their payment processing systems until banks, card networks, and PA/PGs are certified and live with stable APIs for consumer-ready solutions,” the joint letter noted.

The two bodies have sought a phased implementation of the new mandate, a minimum time frame of six months for merchants to comply post readiness of banks, card networks, and payment aggregators/payment gateways, as well as the generation of consumer awareness about the impact of the policy change. They highlight that RBI regulated entities are not prepared, in the absence of a hard mandate to comply.

The RBI had in September 2021 prohibited merchants from storing customer card details on their servers with effect from January 01, 2022, and mandated the adoption of CoF tokenization as an alternative to card storage. MPAI and ADIF believe that if implemented in the present state of readiness, the new RBI mandate could cause major disruptions and loss of revenue, especially for merchants. According to the letter, “Disruptions of this nature erode trust in digital payments and reverses consumer habits back towards cash-based payments.”

MPAI and ADIF are of the view that ‘ecosystem readiness’ is a sequential process of going live with stable API documentation for tokenized transactions. Moreover, in the joint letter, they have highlighted that the digital payments ecosystem is a long way from consumer-ready solutions and that the implementation of tiered timelines for compliance will help minimize disruption to consumer services. Unless regulated entities are compliant, merchants will not be able to successfully process tokenised transactions.

 According to Sijo Kuruvilla George, Executive Director, Alliance of Digital India Foundation, “In the scenario that banks are lax on preparedness, the brunt of that will be borne by merchants in the form of loss of revenue – we are looking at revenues losses of anywhere between 20-40% at the minimum should that be the case. It’s also important to note that it’s only after the readiness of bank, card networks and API’s are made available that merchants are even able to take effective measures on their part to comply.”

According to Vishal Mehta, Chair of the Governing Council of the MPAI, "This unpreparedness will impact recent digital payments adopters even deeply. The frequency and intensity of phishing attempts will go as entire card details are to be entered for each transaction, causing a significant increase in irreversible fraudulent transactions."

About MPAI

The Merchant Payments Alliance of India (MPAI) is a consortium of merchants that leverages digital payments to serve millions of Indians with innovative goods and services. Its members include leading technology companies that are committed to generating value for India’s digital markets with a concerted focus on quality-of-service, convenience, and security.

About Alliance of Digital India Foundation

The Alliance of Digital India Foundation (ADIF) is a think tank for India’s digital start-ups formed to fully capitalise on the sector’s promise with the objective of its long-term prosperity in mind. ADIF's mission is to transform the Indian startup ecosystem into among the best in the world while upholding the essence of the Indian startup playbook or the Indus Valley Playbook and ensuring that it emerges as a strong alternative to the dominant Silicon Valley Playbook. ADIF now is an alliance with 470 members.

Below is the joint letter sent to the RBI.

Joint Letter RBI

1.53MB ∙ PDF file

Download

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Google’s decision to extend the deadline for the new PlayStore policy to October 2022 certainly gives developers a short-term relief for their anxiety and ADIF welcomes this decision. We, however, disagree and mark our strong objection with the reasoning given for the extension. The core issue for the developers is the gatekeeper tax of 15-30% on a select category of apps and restrictions on the use of other payment options and Google fails to admit that in their announcement. 

App developers, especially those selling digital goods and services, have been unhappy and vocal about their objections to the policy ever since it was announced back in September 2020. Google has been tinkering with the policy since – moving the deadline and then lowering the percentage of its app store fees – to make it more palatable to the app developers. Having failed to appease the developers with half-hearted measures, the company has now extended the deadline a second time around. 

“There is a petition before the Competition Commission of India (CCI) seeking to stop Google from implementing these policies before the investigation against its alleged anti-competitive practises has been completed. ADIF has maintained that if the status quo is not maintained, and if app developers are forced to migrate to Google’s in-app billing system before the probe has been completed – be it in March 2022 or October 2022 – it will result in irreversible consequences for India’s startup ecosystem.”

“The reality is that app owners have been in a very tough spot as they are unsure if they should unwillingly comply with Google’s new policies and be hopeful of a CCI’s intervention on the interim relief petition for maintaining the status quo. Google’s deadline extension certainly gives them more time but doesn’t take away their uncertainty.”

Sijo Kuruvilla George, Executive Director, ADIF

ADIF also disagrees that the issue for developers is one of figuring out recurring payments as per the new RBI guidelines. Developers who collect recurring payments are mostly selling digital goods and services. 

The core issue for the developers is the gatekeeper tax of 15-30% on a select category of apps and restrictions on the use of other payment options. We hope that Google makes use of this additional time to actually listen to the problems of app developers and come out with a policy that is fair to all applications on the PlayStore. 

Founded in 2020, ADIF (Alliance of Digital India Foundation) is an industry body for India’s digital startups formed to fully capitalise on the sector’s promise with the objective of its long-term prosperity in mind. ADIF aims to transform the Indian startup ecosystem into the top 3 globally by 2030.

Among the issues ADIF is working on, we are fighting Google and Apple on their app store monopolies.

The Alliance is now 460+ members strong. Join the Alliance of Digital India to become a part of our journey to transform India’s startup ecosystem into the best in the world.

New Delhi & Washington D.C., Nov 18, 2021: The Alliance of Digital India Foundation and the Coalition for App Fairness announced a partnership to jointly work towards a free and fair app marketplace for all developers. 

The partnership comes on the heels of the Global Conference on Mobile App Ecosystem Fairness held in South Korea where the discussion centered around the need for regulating the application ecosystem. There has been a global uproar against the anti-competitive app store policies of both Apple and Google, which include a steep gatekeeper tax on all digital goods. Both the players have been going to great lengths to solidify their already dominant position in markets the world over.

In response, organisations have been coming together globally to fend off their abusive practices and to create a fair environment for all developers. South Korea’s new law to bring competition to the digital marketplace has been a landmark step in this direction and has highlighted the critical need for similar legislations in India and other regions to pave the way for a fair app marketplace so developers can innovate and grow.

It’s this urgent need for collaborative work that saw ADIF and CAF joining together to amplify efforts towards a fair app ecosystem.

“We are partnering with a group of leaders to support the efforts towards creating a free and fair digital ecosystem, one which is not owned and controlled by just one or two large players,” said Sijo Kuruvilla George, Executive Director of the Alliance of Digital India Foundation. “No developer should be forced to operate in an anti-competitive marketplace that hinders innovation, success, and the ability to grow.”

“With this partnership, the global momentum to fight anti-competitive practices in the app marketplace continues to build,” said Meghan DiMuzio, Executive Director of the Coalition for App Fairness. “Our alliance will ensure developers who have been prevented from competing in a fair marketplace stand united, working together to advocate for solutions around the world.”

About the Alliance for Digital India Foundation

The Alliance of Digital India Foundation (ADIF) is a think tank for India’s digital start-ups formed by some of the large Indian internet companies including Bharat Matrimony, PayTM, SHEROES etc. The work of ADIF centers around ensuring a strong ecosystem for digital startups in India by fostering innovation and creating a level playing field for young entrepreneurs to compete with larger players in a free and fair app economy.  However, because companies like Apple and Google control the marketplace on their terms, the need for legislation in India is more important than ever. ADIF has already approached Competition Commission of India (CCI) to prevent the abuse of dominance by the leading players. India’s startup ecosystem has the potential to grow rapidly, but to do so, there needs to be proactive legislation to allow for innovation and success in the app marketplace.

By partnering with the Coalition for App Fairness, ADIF is expanding its efforts to promote innovation and fight anticompetitive app store practices. To learn more about ADIF and its work, visit blog.adif.in

About the Coalition for App Fairness

The Coalition for App Fairness is an independent non-profit organization formed to protect consumer choice, foster competition, and create a level playing field for all app and game developers globally. Originally formed by Basecamp, Blix, Blockchain.com, Deezer, Epic Games, the European Publishers Council, Match Group, News Media Europe, Prepear, Protonmail, Skydemon, Spotify, and Tile, CAF has rapidly grown from 13 to over 60 members since launching in September 2020. CAF offers membership to companies of any size – join today at appfairness.org.

It is encouraging to see that Apple has taken the first credible step to move away from its desire to earn commission on every dollar made by app developers on their store. 

It has deleted the contentious clause (3.1.3) which was being used by Apple to maintain a stronghold on the developers in order to make them cough up hefty commissions. The changes announced to the AppStore guidelines have put an end to the company’s restrictive and anti-competitive practice of blocking developers from communicating with their own customers and directing them to other payment options of their choice. 

The fact that Apple has relented, is the result of the concerted and collective actions of various stakeholders of the app ecosystem, right from developers to industry bodies to regulators around the globe - the pioneering work by the Coalition for App Fairness (CAF) also deserves special mention. The revisions are also in alignment with the recent ruling by a US court.

The development opens the door for developers to opt for payment providers of their choice and to extend their services to Apple without having to be forced to pay a toll. This change results in AppStore being a much fairer marketplace. 

“This comes as a major victory for the developer and startup community who have been vocal against the restrictive and anti-competitive practices of the two big tech majors through their AppStore/PlayStore policies.

Having said that, practices that restrict app developers with their product and user experience choices still persist. For instance, Apple has still not relented on allowing alternative payment systems to be embedded directly in their apps. 

It is crucial now to ensure that the efforts towards making the app economy a fair marketplace are sustained. It is only when all such restrictive practices are also done away with that the app marketplace can be deemed a true level playing field that allows for innovation to thrive.” 

Sijo Kuruvilla George, Executive Director, ADIF

The development will also come as an additional strain on Google’s dogged efforts towards implementing their stated policy of enforcing their own in-app billing system by March 2022. Google was in recent times seen to match and mirror Apple point to point as far as billing and payment policies on their PlayStore goes. Should Google look to match this policy of Apple as well, it would render their announcement with the March 2022 deadline moot. 

Founded in 2020, ADIF (Alliance of Digital India Foundation) is an industry body for India’s digital startups formed to fully capitalise on the sector’s promise with the objective of its long-term prosperity in mind. ADIF aims to transform the Indian startup ecosystem into the top 3 globally by 2030.

Among the issues ADIF is working on, we are fighting Google and Apple on their app store monopolies.

The Alliance is now 440+ members strong. Join the Alliance of Digital India to become a part of our journey to transform India’s startup ecosystem into the best in the world.

The recent announcement by Google, related to changes in PlayStore pricing, points to an admission of guilt and unfairness on Google’s part in their PlayStore policies. While Google has attempted to address one aspect of the unfairness - high prices (albeit in a half-hearted manner), the more important aspects related to anti-competitive practices – of restricting other payment providers to operate in their app economy and allowing a choice of payment provider to developers, remain unaddressed & unresolved still. 

The announcement might come as a source of happiness for the subset of developers who are already on the Google billing system. The cut will improve their margins – should they fall into the “right” categories that the company deemed fit for Google’s relaxation in margins. 

The announcement does nothing to address the issues and challenges of scores of developers who stand to be affected by the earlier announcement by Google of forced adoption of their billing system by March 2022. Moreover, apart from the additional work they would have to undertake, both with integration and re-onboarding of customers, almost all of them would see their margins get thinner owing to migrating to a much higher commission rate (30%/15%) from the present rates (1%-2%) being levied by their existing payment providers. 

The differential pricing system that Google is attempting to implement with this announcement is also unfair and arbitrary. As per the announced policy, different categories of apps would attract different tariffs while being provided exactly the same level of service. Moreover, such pricing structures would further distort market forces to the detriment of all. 

“The fact that Google is able to unilaterally declare and dictate prices, as is evident from this announcement as well, lies at the heart of the issue. What developers are asking for is fairness and not benevolence in the form of “reduced” commission percentages. It has never been about the percentages. Price discovery should be left to the market forces. As long as Google gets to unilaterally dictate prices and people don’t have choices, it's still a Lagaan – be it 30, 15 or even 2, the percentages do not matter,” said ​​Sijo Kuruvilla George, Executive Director, ADIF. He added: “Deflect and distract seems to be what's in play here. The portrayal and grandstanding, as a measure that fully acknowledges and addresses the concerns of developers, is misleading and objectionable”

ADIF urges Google to pay heed to the concerns of all developers, and not just the ones already on their billing system. We have maintained that Google must be fair and end the ongoing anti-competitive practices in the name of PlayStore policies. The matter has been challenged, is being studied by CCI and is awaiting verdict. 

Until the investigation is complete, let's all pledge to maintain the status quo – the prayer of our petition to the CCI as well seeking interim relief. This remains our interim appeal to Google as well. 

Founded in 2020, ADIF (Alliance of Digital India Foundation) is an industry body for India’s digital startups formed to fully capitalise on the sector’s promise with the objective of its long-term prosperity in mind. ADIF aims to transform the Indian startup ecosystem into the top 3 globally by 2030.

Among the issues ADIF is working on, we are fighting Google and Apple on their app store monopolies.

The Alliance is now 440+ members strong. Join the Alliance of Digital India to become a part of our journey to transform India’s startup ecosystem into the best in the world.

The Reuters investigation brings to light Amazon’s blatant disregard for competition laws, intellectual property rights and disgraceful predatory practices. The manner in which the e-commerce giant has targeted the Indian market and leading brands in the country is highly deplorable and brings into question the credibility of Amazon as a good faith operator in the Indian startup ecosystem. 

These findings go on to validate the allegations and fears of various stakeholders and serve as incriminating evidence. It’s worth noting that Amazon has on multiple occasions, including during formal hearings, denied any wrongdoing that involves making use of consumer data to drive advantage for its own brands and products. 

The findings bring to light that it's a systematic design – a playbook if you will – by Amazon to predate and kill competition by weaponizing every tool at its disposal. Amazon taking advantage of consumer data that they are in possession of, using that information to the detriment of the brands and sellers that helped generate the data in the first place, and then rigging search results to further hurt the original brands is an economic offence of the highest order, one that has destructive consequences for markets and falls foul of fair competition practices. 

These findings serve as a further fillip for the intent of the Government to introduce reforms in the e-commerce marketplace. The recent draft regulations have been aimed at targeting predatory practices using intermediaries for the protection and benefit of sellers, manufactures and consumers. 

It is important for every ecosystem stakeholder and the Government to join hands and intervene to ensure that Amazon abides by the laws of the land and also adopts ethical practice of doing business. A culture of fair competition and good faith practises is absolutely essential for the health of markets and the economy, and it is also the role of regulation to bring about such an environment. Timely action on the part of the regulators is the need of the hour and speed is also of the essence – more and more brands get killed with the passage of time. 

A situation where Amazon, or any player for that matter, acts as the powerful online marketplace, seller and collector of data, cannot bode well for the health of the e-commerce market, neither will it be in the interest of the consumers – both in the short term and the long term. This has to stop right now. This development also brings to attention the significance and importance of good data protection laws for the health and prosperity of digital markets. 

As one of our Alliance members and a brand owner put it “Hope the authorities take the necessary actions to put an end to this!”

ADIF is an Alliance of individuals, founders & organisations with the mission of transforming India into one of the best startup ecosystems in the world. The goal is to get to the top 3 by 2030. The Alliance is now 400+ members strong.

Join the Alliance of Digital India to become a part of our journey to transform India’s startup ecosystem into the best in the world.

New Delhi, October 11, 2021: The Alliance of Digital India Foundation (ADIF) has filed a petition before the Competition Commission of India (CCI) through their lawyers at Sarvada Legal seeking interim relief from Google’s new PlayStore policy which goes into effect from March 2022. The matter is already being looked into by the CCI for potential abuse of dominance by Google in the app market. 

This relief has been sought by ADIF on behalf of App developers as Google’s new policy will restrict certain categories of apps to use only Google Billing System (GBS) for accepting payments. This would be an issue for app developers because GBS charges 30% commission for all transactions on the Google Play Store, compared to 2% charged by other payment processing systems. There is a strong case for seeking such relief as this new policy, when it goes into effect next March, would have a destructive effect on the operating margins of a large number of startups and make their business models infeasible.

The CCI had in November 2020 directed a probe by the Director General into the issue of mandatory use of Google Play Store’s payment system for paid apps & in-app purchases. The commission is of the prima facie view that such a policy is unfair as it restricts the ability of app developers to select a payment processing system of their choice.

In its petition to the commission, ADIF, which represents the interests of various stakeholders such as startups, app developers, etc. and espouses the objective of improving the startup ecosystem of the country, has stated that the 30% commission charged by Google is extremely high and unfair. However, the organization said that the core issue is the mandatory imposition of the Google Play Billing system and the exclusion of other methods of payment.

“This will have a disastrous effect on India’s digital ecosystem by reducing choices available in the hands of app developers and users as well as harming the country's innovation ecosystem by disrupting the cost structures and margins of multiple industries,” it said.

While ADIF will support the ongoing inquiry by the Director General into the matter, it has been compelled to move the application for interim relief to protect the choice of app developers to use other payment systems with far more favorable terms of service. Google’s new policy will exclude competing payment service providers from the market for payments for digital goods consumed through Android devices. 

“ADIF foresees that barring an order passed by this Hon’ble Commission to maintain  status-quo until the completion of the ongoing inquiry, Google shall proceed to enforce its terms on the Play Store, thereby leading to adverse and irreversible consequences on India’s fledgling startup ecosystem,” said Sijo Kuruvilla George, Executive Director, Alliance of Digital India Foundation.

Murugavel Janakiraman, the Founder and CEO of Matrimony.com, said: “The matter is not as much about the percentage of commission charged as it is about the anti-competitive practice of forcing a payment option as well as of forcing out other payment providers. If not kept in check, such anti-competitive policies and gatekeeper commissions will be imposed on more and more categories, causing a disastrous effect on competition and prices in India.”

ADIF believes that if the status quo is not maintained pending the completion of the inquiry, Google will enforce its terms on the Play Store in March 2022, leading to irreversible consequences for India’s startup ecosystem.

About Alliance of Digital India Foundation

The Alliance of Digital India Foundation (ADIF) is a think tank for India’s digital start-ups formed to fully capitalise on the sector’s promise with the objective of its long-term prosperity in mind. ADIF's mission is to transform the Indian startup ecosystem into among the best in the world while upholding the essence of the Indian startup playbook or the Indus Valley Playbook and ensuring that it emerges as a strong alternative to the dominant Silicon Valley Playbook. ADIF now is an alliance with 422 members.

This is a significant development, one that bolsters the confidence in Indian markets as well its regulators. Effective differential voting rights – or the lack of it – was one of the key limiting factors that made startups consider listing abroad as opposed to doing so in India. The development is a major step forward on the ease of doing business index and will enhance the attractiveness of listing in India.

This move by SEBI signals that the regulator understands the needs of the startup ecosystem and is committed to enabling its growth. Progressive policy making such as this one will bring our business environment on par with international alternatives and move us further on the path of being among the best startup ecosystems in the world.

ADIF lauds the Finance Minister’s intent and the initiative to understand and resolve the issues forcing tech companies to register abroad.  

Indian founders having to register overseas has been among the major bottlenecks facing our startup ecosystem. The phenomenon results in the equivalent of a brain drain wherein we, as an ecosystem, lose out on talent, IP as well as tax revenue.

The issue gets compounded when Indian investors systematically lose out on the opportunity to put their funds in such entities owing to limitations on investing in overseas unlisted companies as prescribed by RBI guidelines and the LRS scheme.

The core issue is linked to the ease of doing business in India. It is commendable that the Minister has chosen to address this problem and not demonise the founders who have been forced to make the decision to register abroad keeping in mind the best interest of their businesses.

We hope the discussions that ensure will result in actions that bring our ecosystem on par with the best in the world in terms of business environment and ease of doing business.

South Korea is continuing to lead the way in reigning in Google for its anti-competitive practises. The anti-trust regulator, the Korea Fair Trade Commission (KFTC), has found Google guilty of misconduct and imposed a fine of $176.64 million. While the quantum of fine per se will likely not make any dent to the Big Tech giant, the action by the commission is yet another scathing indictment of Google’s conduct and abuse of dominance.

The KFTC verdict should have an effect of strengthening and expediting the probe by antitrust regulators against Google in India. Previously, Google was also fined £3.8bn by the EU over Android antitrust violations. Another noteworthy development is that multiple instances of abuse of dominance and anti-competitive behaviour by Google are coming to the fore in nearly all markets that the company operates in.

Given Google’s presence and dominance in multiple key markets is tied to the health of the digital and internet economy (search, advertising, browser, smartphone & smartphone OS, app economy, payments etc) it becomes pertinent for the Indian Government, and its key regulatory institutions involved – MeiTY, CCI and RBI – to take note and enact legislative actions for the benefit of our ecosystem and our startups.

In the long run, it is not ex post facto fines but proactive and progressive legislative efforts that will nurture and nourish a healthy, innovative and competitive ecosystem. 

Murugavel Janakiraman

Murugavel Janakiraman is the Founder and CEO of Matrimony.com, whose flagship brand is BharatMatrimony, India’s most trusted matrimony service. The company is powered by over 3,500 employees across 130 branches in 20 major cities in India. Matrimony.com is India’s first pure-play Consumer Internet Company to be publicly listed.

In 1997, he pioneered the concept of online matchmaking that changed the way Indians marry. Twice he was nominated by The Economic Times for the “Entrepreneur of the Year” award. Besides being awarded Digital Entrepreneur of the Year by WAT, he was also Chairman of the IAMAI (Internet and Mobile Association of India). He’s a speaker at major summits including those hosted by Harvard School of Business, India Today, Business World, IAMAI, CII, TiE, Stanford India and FICCI.

Sairee Chahal

Sairee Chahal is the Founder and CEO of SHEROES, the world’s largest online ecosystem for women. SHEROES offers employment, entrepreneurship, capital and community support to women on its network.

Sairee has an M.Phil from JNU and a PGDBM from IMT Ghaziabad. She is an Aspen Fellow and is a recipient of the Devi Award, Femina Achievers Award, Editor’s Choice for L’Oreal, Femina Women’s Award and Business Today Most Powerful Women in Indian Business, and Cartier Award.

Ajay Data

Dr Ajay Data is a young techno-commercial Founder and CEO of multiple technology companies. His hard work, visionary approach, belief in teamwork and ingenious thinking made Data Infosys Limited a highly-respected IT company.

As CEO of the leadership team of the company, he has been driving initiatives to build a skilled and culturally diverse global workforce. His innovation and execution of software products like BharatSync, XgenPlus, Spamjaoo, and DATAMAIL have got users the world over and won multiple patents.

Making a modest start on April 18th 1999 as Rajasthan’s first private ISP, the company rapidly expanded its line of businesses in the areas of e-Governance, Software Products, Turnkey IT Solutions and Mobile Technologies. Recently Data Xgen Technologies got global recognition for bringing in first-of-its-kind IDN email supporting email addresses in 11 local Indian languages, including Hindi, Gujarati, Tamil, Telugu, and Marathi. Dr Data is Managing Director of Data Group of Industries with an annual business turnover of approx US $200 million and sought after leader by young entrepreneurs for mentoring and guidance.

Recently, the Government of Rajasthan also started email services to every citizen on the innovation and technology built under his leadership and guidance. In his wide-ranging experience in these organisations, he has led the transformation of HR into a strategic partner, facilitated organisation-wide transformation and capability development, and has been instrumental in building a strong talent pool through a series of leadership development initiatives.

Ritesh Malik

Dr Ritesh Malik is a medical graduate who took a detour from conventional medicine to follow his passion for entrepreneurship. In 2016, Dr Malik started a coworking platform called Innov8. A venture, which started with Ritesh’s sheer love and thirst to promote entrepreneurship in the country, is now one of the leading names in the coworking ecosystem of India.

Innov8, a Y-combinator backed coworking space, is a platform to connect communities of freelancers, entrepreneurs, corporates, tech innovators and investors under one roof and in a social environment. In 2019, Innov8 Coworking was acquired by Softbank-backed OYO Group. Innov8 has a presence in over 14 cities of India, panning over 30 campuses.

Dr Malik has been one of the most active angel investors in the country and has invested in over 50 companies in the last six years. WittyFeed, Sarva Yoga, Sheroes, Sattviko, Josh Talks, PeeSafe, SectorQube, Inc42, QDesk, Leverage Edu, CivilCops, Pesto, OrangeWood (YC), Inito (YC), StylDotMe, TapChief, Asimov Robotics, and Ketto, are some of the companies that are a part of his investment portfolio. Dr Malik’s leadership and contribution to the Indian startup ecosystem is widely recognised by the startup industry and media fraternity with recognitions like Forbes 30 under 30 Asia (2016), Fortune 40 under 40 India (2018), PWC & SPH 40 Influential Indians, Business World 40 Under 40 (2017), Entrepreneur Magazine 35 Under 35 India (2017), Star of Delhi award by Hurun Report, CEO of the year (Real Estate Tech) by Economic Times, and ‘The Coworking Wonder’ title by Entrepreneur Magazine to name a few.

Snehil Khanor

Snehil Khanor is a serial tech entrepreneur who has founded startups from his school days and is currently the Founder & CEO of TrulyMadly.

Snehil is a firm believer in creating sustainable business practices or as he likes to call it ‘Frugile Methodology’ (Frugal+Agile) for startups. Under his excellent leadership, TrulyMadly has become one of India’s largest matchmaking app.
TrulyMadly has nearly ten million downloads and has redefined the way Indian millennials are finding their partners.

Snehil started his entrepreneurial journey 14 years ago with the launch of a social networking site along with music and video streaming portals back in 2006, while he was still in school. In 2011 while pursuing engineering in Computer Science, he joined Letsbuy, an e-commerce startup, where he developed and launched their mobile app and site while mobile-commerce was still in its nascent stage in India. Letsbuy was later acquired by Flipkart in 2012.

Snehil also co-founded Findyahan, a services marketplace, which was eventually acquired in 2016 by Zimmber. Snehil joined Zimmber as Vice President of Product & Marketing. Zimmber was later acquired by Quikr.

In 2017, Snehil joined Spice Digital Limited as Vice President and had the opportunity of heading an esteemed project for the Government of India titled ‘UMANG’. UMANG was launched by Hon’ble Prime Minister Shri Narendra Modi in November 2017. In 2018, Snehil came back to TrulyMadly to lead as the Co-Founder & CEO. Over the last two years, Trulymadly has grown significantly both in terms of its user base and revenue.

Snehil is also an angel investor/mentor in almost a dozen startups like Almo Wear, Stage/WittyFeed, TheManCompany, Unshaadi etc. and loves to help startups whenever and however he can. Snehil holds a B. Tech degree in Computer Science from Apeejay College of Engineering, Gurugram. In his leisure time, he enjoys traveling, photography, reading, and playing online games.

When WhatsApp is loading on your device, the message under a thin green bar reads: End-to-end encrypted. WhatsApp has centred all of its communication campaign around complete privacy and repeatedly assured its users that all messages on the platform are end-to-end encrypted – and absolutely no one, not even WhatsApp itself, has access to them. In the light of the ProPublica investigation that the company has, in fact, an extensive monitoring operation and regularly shares personal information with prosecutors, the marketing exercise by WhatsApp reeks of subterfuge and comes across as an act of bad faith.

As a practice, companies ought to communicate their policies clearly to their users and omitting a critical portion of it – like the fact that Facebook can access the users’ chats if it wishes to – is a clear case of subterfuge. What makes it even more troubling is that the Facebook CEO deposed before the US Senate that no such sharing of data was taking place. That act could be viewed as perjury at worst and incompetence at best – neither or which augurs well for the company in terms of being a trustworthy good-faith operator.

Even if Facebook’s claim that it reads user’s WhatsApp messages only when spam or abuse is reported is true, it still does not address the underlying issue that users have been clearly misled to believe that the much-touted end-to-end encryption provides them with complete privacy. On every count, WA/FB stands in clear violation of good faith and ethical principles.

A public account of the internal processes adopted, the extent to which monitoring has happened and intimating users about the instances and chats that were accessed by the company for what purpose would be a clear step in restoring faith and confidence. Even in such a scenario, would WA commit enough marketing dollars to such a communication exercise is also anybody’s guess.

The Hurun Research Institute’s report serves as further validation that India is among the largest startup markets in the world today. The report also sheds light on some of the environmental challenges that are holding us back from being the best startup ecosystem in the world. A lot more needs to be done, particularly on the front of deepening and democratising the investing ecosystem in our country.

While we are the third largest in terms of size, we hover around the 20’s in terms of rankings – we even slipped a few points in rankings over the last few years. A lot more needs to be done on the business environment front, particularly on deepening and democratising the investing ecosystem in our country.

A truly digital startup ecosystem that enables setting up, running and winding up of companies in a paperless, contactless governance mechanism untethered to a physical address would be pathbreaking. This would help us scale rapidly on ecosystem rankings and impact real ease of doing business.

The passing of the bill by South Korea’s National Assembly is a welcome development. Any legislation on the matter anywhere in the world will set a precedent for other nations to adopt and build on, and we hope this will now expedite similar legislations by other governments as well.

The matter has always been about the anti-competitive practices of forcing a payment option as well as of forcing out other payment providers.

We exhort the Apples and Googles of the world to uphold the spirit of the legislation and adopt fairer policies going forward. Unfair markets and anti-competitive practices stifle innovation and adversely impact market outcomes in the long run.