The Indian Digital Media Industry Foundation (IDMIF) has approached the CCI to challenge Google’s billing policy. The challenge aims to address concerns related to Google’s app store billing practices.
IDMIF, an industry body, represents prominent streaming players in India. It represents major OTT platforms in India like Disney+ Hotstar, Zee5, Voot, SonyLIV, Manorama Max, SunNXT, and Discovery+.
According to the reports, the IDMIF sent a letter to CCI to fight against Google’s Play Store Commission. The industry body stated that Google’s commission fee is unjustifiable and harmful. They believe Google’s billing policy could lead to smaller OTT platforms and channels closing.
Particularly, those in the content curation business are at risk. The challenge aims to address these concerns and protect the interests of streaming apps.
The CCI asked IDMIF to submit evidence supporting its claim against Google’s billing policy. CCI’s request for evidence indicates a thorough examination of the matter.
Under the previous GBPS, streaming platforms paid 15-30% to Google. The ‘new user choice billing (UCB) system’ reduced the rate to 11-26%.
Stage CEO Vinay Singhal’s Statement
Vinay Singhal, CEO of Stage, an OTT platform, stated that IDMIF’s approach strengthens their ongoing case. The case emphasizes that both smaller and larger players will be affected by Google’s billing policy.
IDMIF’s representation adds significant weight to the concerns raised against Google’s app store billing policy.
Disney+ Hostar approaches the court
The move comes after Disney+ Hotstar app owner, Novi Digital Entertainment, approached the Madras High Court to prevent Google from removing the app. Reportedly, it is the first non-Indian streaming platform to challenge Google’s policies.
Disney+ Hotstar aims to protect its presence on the Google Play Store. The Madras High Court granted Disney+Hotstar an interim injunction, lowering the commission to 4%.
Madras High Court’s Order
In April, Bharat Matrimony, Shaadi.com, and other companies challenged Google’s billing policies.
The Madras High Court reserved its order on the suit against Google’s billing policy after proceedings on 27th June 2023. The final decision on the matter is pending from the court.
Startups fear Google might modify the contract. Courts have previously ruled against such unilateral choices.
The court’s decision aims to provide relief to the streaming platform during the ongoing case. Google received directions not to delist suing companies, pending the high court’s verdict. The directions will remain effective until the court delivers its decision.
App developers couldn’t provide direct links or encourage alternative payment methods within the app. Non-compliance led to app developers losing potential customers on the Play Store.
“Laagan Tax”
Google had planned to implement a new billing system from April 26, which faced opposition from app developers and start-ups. They labelled it the “Laagan tax” and sought relief from the Delhi High Court.
The new billing system by Google would enable users to choose an alternative billing option alongside Google Play’s billing system.
This decision followed the CCI’s October 2022 order, which required Google to permit developers to utilize third-party billing systems. Thus, The US-based Internet giant allowed app developers to use third-party billing with an 11-26% “service fee.”
Also, In the same period, the CCI imposed a ₹936.44 crore penalty on Google for abusing its dominant position. The penalty relates to Google’s Play Store policies.
The CCI issued a cease-and-desist order and instructed Google to modify its conduct within three months. Google was previously fined ₹1,337.76 crore for similar violations.
AIDF Criticizes, Calls Google’s Billing Policy “masked”
The Alliance of Digital Foundation (ADIF) criticized the new system as a “masked” version of Google’s prior billing.
Ritesh Malik, ADIF’s Director, expressed concerns about Google leveraging its app marketplace dominance. He highlighted the 4% reduction through User Choice Billing (UCB) but faced an anti-competitive higher commission.
Google faced criticism for imposing entry barriers for other digital payment providers. ADIF serves as a think tank for Indian digital start-ups.
