top of page
  • Voltaire Staff

Google faces heat from CCI over billing system for apps



The Competition Commission of India has initiated an investigation into Google's Play Store billing policy, at complaint of several parties, including the owner of Shaadi.com.


At the heart of the matter is Google's billing policy for apps on the Play Store, which apps offering digital products or services used within the Android system to pay a commission on in-app purchases.


The disagreement between the tech giant and the companies revolves around Google imposing fees ranging from 15 per cent to 30 per cent on in-app payments made by their users. In case, apps choose to make payments using an alternate billing system – as provisioned by Google – they are still required to may Google fee between 11 per cent and 26 per cent, as the case may be.


This directive follows new complaints lodged by People Interactive India (operator of Shaadi.com), Mebigo Labs (owner of Kuku FM), Indian Broadcasting and Digital Foundation, and Indian Digital Media Industry Foundation.


In a 21-page order, the fair trade regulator noted that the revenue sharing model in the Play Store seems to favour Google, potentially burdening app developers with significant costs.


The fair trade regulator, CCI stated that it believes Google has unfairly set prices, potentially violating the Competition Act, prompting a thorough investigation.


It has instructed the Director General to conclude the inquiry and provide a comprehensive report within 60 days.


The CCI observed, "Service fee charged by Google has been alleged to be excessive in nature and by requiring the app developers to pay such excessive service fee for processing payments through GPBS (Google Play Billing System) as well as ABS (Alternative Billing Systems) under UCB (User Choice Billing), Google is alleged to be imposing an unfair price.... It has been inter alia claimed by the Informants that, the service fee /commission charged by Google bears no reasonable relation to the services Google is offering in exchange for the fee."


Google's commission is much higher compared to its competitors, many of whom charge nothing for similar services, the commission noted.


In a statement, Google said, "The CCI had previously examined our service fee in detail between 2020 and 2022 and found no illegality. However, we take our commitment to comply with local laws and regulations in India seriously and will cooperate with the process anyway."


Earlier this month, Google removed several Indian apps, including Shaadi.com and Info Edge's Naukri.com, from the Play Store for non-compliance with its in-app payment and billing policy. Only after government intervention were these apps reinstated.



 

Comments


bottom of page