App-tastrophe: Google vs Indian Startups

In a recent turn of events that feels a bit like a “been there, done that” moment for India’s tech scene, Google and Indian internet companies are butting heads again. Google and several Indian app developers are at loggerheads, and the situation has escalated quickly. Here’s the lowdown on what’s happening, why it matters, and what could be next, all wrapped up in a more digestible, conversational tone.

The Google Play Store Showdown

On March 1, 2024, Google dropped a bombshell by removing over 150 apps from its Play Store. These weren’t just any apps; they were developed by some of India’s top digital companies, including big names like Matrimony, Info Edge (the brains behind Naukri, 99acres, Jeevansathi), Shaadi.com, and Kuku FM. Why? Well, it boils down to a disagreement over Google’s app billing policy. Google insists that developers use its billing system for in-app purchases, and it seems these companies weren’t on board with that.

But here’s a twist – Google quickly changed its mind about a few apps, bringing back the likes of Info Edge and Shaadi.com to the Play Store fold. This whole saga is just the latest chapter in an ongoing battle between Google and Indian app developers, who are not too pleased with Google’s policies, especially the billing system mandate announced back in October 2020.

Why Is This Happening Now?

The timing is interesting. Google’s move came shortly after the Supreme Court of India decided not to protect these companies from being removed from the Play Store, despite their plea against Google’s billing policy. This legal tussle isn’t new; the developers had previously lost a challenge against Google in the Madras High Court.

So, which apps got delisted? While Google kept silent on specifics, sources revealed that apps like Shaadi.com, Naukri, 99acres, and several others were affected. Bharat Matrimony’s founder, Murugavel Janakiraman, griped that these apps were taken down, marking a “dark day for Indian Internet.”

The Heart of the Matter

In India, more than 95% of smartphones are powered by Android, which is Google’s own operating system. This includes various brands such as Samsung, Motorola, and Oppo, among others, all of which rely on Android for their operating software.

At the core of this dispute is Google’s app billing policy, which requires apps to use Google’s payment system for in-app purchases, allowing Google to take a cut ranging from 15-30%. Many Indian developers find this fee exorbitant and unfair, sparking widespread discontent.

In fact, a couple of years back, the Competition Commission of India, or CCI for short, found something pretty interesting. They discovered that Google was kind of hogging all the limelight on Android phones, making it tough for other app stores to get a piece of the action. Basically, the Play Store was the star of the show, and no one else could get on stage. Because of this and a few other things, the CCI decided to give Google a bit of a wake-up call. They handed them a hefty fine of ₹2,200 crore. Talk about a reality check, right?

Indian entrepreneurs are understandably frustrated. Info Edge’s founder is advocating for an Indian alternative to Google Play, envisioning an app store that’s part of India’s digital public infrastructure. Others have been more vocal in their criticism, with Kuku FM’s co-founder calling Google the “most evil company for businesses.”

Google’s Side of the Story

Google defends its actions by arguing that giving certain developers a pass would create an uneven playing field, disadvantaging those who comply with its policies. The tech giant emphasises its investment in supporting Indian developers and the necessity of its service fees to sustain these efforts.

Google has laid out options for the delisted apps: integrate Google’s billing system, offer an alternative alongside Google’s, or operate as a consumption-only app. Some apps, like Shaadi.com, have already adapted to these terms.

The Government Steps In

The Indian government isn’t sitting this one out. Union Minister Ashwini Vaishnaw has voiced his concern, promising to meet with the affected developers. His stance is clear: arbitrary delisting of apps won’t be tolerated.

Meanwhile, everyone’s eyes are on the upcoming Supreme Court hearing on March 19 and whether the Competition Commission of India will step in. This isn’t just a local issue; Google’s app marketplace practices are under scrutiny worldwide.

Wrapping It Up

This situation is more than just a corporate spat; it’s a pivotal moment for India’s digital landscape. As the country with the second-largest internet user base globally, the outcome of this dispute could set precedents affecting not only Indian app developers but also the global tech community. With the government getting involved and the legal battles ongoing, we’re all waiting to see how this unfolds. Will there be a compromise, or is this the beginning of a larger shake-up in the app world? Only time will tell, but one thing’s for sure – the digital world is watching.

Disclaimer: This article has been written for educational purposes only. The securities quoted are only examples and not recommendations.