How India and other countries are challenging the monopolistic practices of Apple and Google
Here are some of the actions countries and companies are taking.
What’s happening in India
Founders of India’s digital startups have been vocal about their opposition to not just Google’s app store fee, but also to the company mandating the use of its own billing system. This opposition has contributed to Google postponing the deadline for enforcing its policy in India to April 2022.
In March 2021, Google announced a cut of its Play Store billing fee globally to 15% from a flat 30% for the first $1 million clocked by a developer, annually, for in-app purchases of digital goods.
In the midst of continued opposition, the tech giant Google recently decided to reduce Play Store commission for apps that offer subscription services. The company said that instead of charging a 30% fee for subscription payments made through Google's built-in payments services, the company will drop the commission to 15%.
However, developers and startups are taking issue not with the deadline or with the percentage charged, but with the monopolistic tactic of forcing Google’s own billing system.
Startup founders have come together and are working on alternatives. Companies like Paytm have come up with their own mini app store. They have also requested the government to support the creation of an independent app store for apps by Indian companies.
In November 2020, India’s Competition Commission of India (CCI) launched an investigation into Google for the alleged abuse of its dominant market position to promote its payment system.
In August 2021, Together We Fight Society, an NGO based in Rajasthan, filed a complaint with the CCI against the Apple App Store’s policies of misusing its market dominance. Apple Inc, in response, asked the Competition Commission of India to dismiss allegations that the company is violating India’s competition laws.
Then, in early January 2022, India’s antitrust watchdog ordered a thorough anti-trust investigation into Apple over its App Store business practices.
Additionally, in October 2021, ADIF filed a petition before the CCI through their lawyers at Sarvada Legal seeking interim relief from Google’s new PlayStore policy which at the time was scheduled to go into effect from March 2022.
Following the petition, in early December, Google deferred the deadline for developers in India to integrate with its Play billing system from March 2022 to October 2022.
Then, in late December, the internet giant moved the Karnataka high court over the Play Store billing probe and sought additional time to respond to ADIF’s petition before the CCI. During the hearing on January 5, the CCI told the Karnataka high court that its investigation arm Director General (DG) has given an assurance that they will complete the ongoing investigation on Google within 60 days 'in all likelihood'.
Thus, the court disposed of Google's writ petition on January 10.
What’s happening in other countries
Other countries have recognised the monopolistic practices of Google and Apple and have moved to counter or restrict such practices.
Here are some of the actions countries and companies are taking:
Game developer and publisher Epic Games filed a lawsuit against Apple in August 2020 following the removal of the iOS version of its battle royale game Fortnite from the App Store. The game was kicked out of the App Store after the game creator launched its own payment system bypassing Apple’s billing.
The direct payment option was also added to the Fortnite app on Android in violation of Google's Play Store rules. Epic Games then filed a similar anti-competitive lawsuit against Google for the game being removed from its Play Store. Epic alleged that Apple and Google monopolised the market for the distribution of mobile apps to users and the accompanying payment processing market.
In September 2020, 13 app publishers in the US, including Epic Games, Deezer, Basecamp, Tile, and Spotify, launched the Coalition for App Fairness to find solutions to issues like anti-competitive practices followed by Apple and Google, like the app stores’ 30% commission structure.
In July 2021, 36 states in the US filed a case against Google alleging that the company abused its power over the sale and distribution of apps through the Google Play Store. The lawsuit states that Google used anticompetitive tactics to thwart competition and ensure that developers have no choice but to go through the Google Play Store to reach users and that it then collects an “extravagant” commission of up to 30% on app purchases.
In July 2021, collective action or a class-action lawsuit was filed in the UK on behalf of around 19.5 million people in the country who have bought apps or in-app digital content, services, or subscriptions since October 1, 2015. The person leading this lawsuit said, “Customers are herded towards the Google Play Store and, once there, have no option but to pay a 30% fee whenever they buy an app or make an in-app purchase. Competing app stores, which could give the same service at a fraction of the price, never get a look in.”
In August 2021, the South Korean parliament approved a bill that bans all major app stores, including those of Google and Apple, from requiring developers to use only their payment systems.
In October 2021, Apple updated its App Store Guidelines to permit developers to contact customers about other payment methods.
In late October 2021, Russia opened an antitrust case against Apple accusing it of failing to allow app developers to tell customers about alternative payment options when using its App Store.
In November 2021, Google announced it will comply with South Korea’s new mandate by giving Android app developers on Google Play the ability to offer alternative payment systems alongside Google’s own.
In early December 2021, a US federal appeals court granted Apple’s request to halt a December 9 deadline to comply with a judge’s directive that the company allow app developers to steer customers to payment methods outside the store.
In December 2021, Apple started legal proceedings against Russia's anti-monopoly regulator in a dispute concerning alternative payment options on its App Store platform.
In late December 2021, Netherlands’ top competition regulator said Apple Inc broke the country’s competition laws and ordered changes to the iPhone maker’s App Store payment policies.
In January 2022, Apple submitted plans to allow third-party payment systems on its App Store to comply with a South Korean law banning major app store operators from forcing software developers to use their payments systems.
Among the issues ADIF is working on, we are fighting Google and Apple on their app store monopolies.
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.