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Google blatantly disobeying CCI orders, charging app developers 11-26% commission: ADIF

Google has reduced its service fee by 4 per cent for app developers if a user pays through an alternate billing system, but app developers are still required to pay a commission fee to Google, violating the orders of the Competition Commission of India, according to the Alliance of Digital India Foundation

Google blatantly disobeying CCI orders, charging app developers 11-26% commission: ADIF

Outlook Start-Up Desk

POSTED ON February 24, 2023 12:49 PM

Google has announced a change in its billing policy for app developers. According to the new policy, if a user chooses to pay through an alternate billing system, Google's service fee will be reduced by 4 per cent. However, app developers will still be required to pay a commission fee to Google, which will be 4 per cent less than the usual fee charged through Google Play Billing Service (GPBS).

This change in policy has been introduced in response to regulatory developments in India. In particular, it is in response to orders from the Competition Commission of India (CCI). Despite this, the change has been criticised as a violation of the remedies mentioned in the CCI Order.

The Alliance of Digital India Foundation (ADIF), a policy think tank focusing on Indian digital startups, has raised concerns about the impact of Google's commission fees on innovation and business growth. ADIF has called on the authorities, including the CCI, to ensure that Google complies with the specific directives of the CCI and does not impose unfair or disproportionate conditions on app developers.

The lack of transparency around Google's commission charges has also been highlighted, particularly as most transactions in the app digital ecosystem do not use GPBS. The imposition of high commission charges on app developers, despite Google claiming Android as an open-source platform, has been criticised as a form of abuse of dominance.

In a statement, a spokesperson for ADIF said: "This exorbitant commission stifles down innovation and business growth in Indian startups, as a major component of the revenue for subscription-based services and In-app purchases are taken by Google, without providing any additional service. Such practices are sheer abuse of dominance, as Google claims Android is an open-source platform but mandates the app developers to pay high commission charges for using the Google platform."

The spokesperson also noted that Google's change in policy is in violation of a specific direction of the CCI that Google shall not impose any condition (including price-related conditions) on app developers, which is unfair, unreasonable, discriminatory, or disproportionate to the services provided to the app developers.

The ADIF has called on the CCI to take action and ensure that Google complies with its orders. The spokesperson added: "ADIF requests the authorities, including CCI, to take this matter and ensure Google complies with the specific directives of the CCI, in letter and in spirit."

In conclusion, Google's new billing policy for app developers has been criticised by the ADIF as a violation of the CCI's orders. The ADIF has called for action to be taken to ensure that Google complies with the specific directives of the CCI and does not impose unfair or disproportionate conditions on app developers.

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