Opinion Express View | Regulating Big Tech: Tread lightly

Last week the Competition Commission of India imposed a penalty of Rs 1,337.76 crore on Google for “abusing its dominant position” in the Android mobile device ecosystem. On Tuesday, the Commission levied another penalty of Rs 936.44 crore on the firm for misusing its position vis a vis its Play Store policies. In its orders, the CCI has accused the company of adopting “discriminatory practices” and indulging in “anti-competitive” behaviour. The orders also lay out a set of corrective measures with regards to the Play Store policies and the Android ecosystem. This has far-reaching implications for the larger digital ecosystem in the country.

The CCI’s orders detail how Google was able to exploit the licensing of the Android operating system to its advantage. The company ventured into agreements such as the mobile application distribution agreement (MADA), which ensured that the “most prominent search entry points”, such as the search app and the chrome browser, are pre-installed on Android devices. This “accorded significant competitive edge to Google’s search services over its competitors”, the CCI has said. Such arrangements also allowed the company to gain advantage over its competitors in adjacent markets — for instance, YouTube. The CCI also said that Play Store policies mandated the exclusive use of Google Play’s billing system by app developers for both receiving payments and in-app purchases. It pointed out that the UPI platform was placed at a disadvantage, with technological preference being given to Google Pay. The company has informed the Commission that it had recently changed its policies that placed UPI at a disadvantage.

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India is not the only country where global tech giants have been caught in the regulatory glare. Last year, in August, South Korea mandated choice in app store payments, effectively barring firms like Google and Apple from compelling app developers to use only their payment systems. In India, the onus is on the Competition Commission to be vigilant against firms gaining unfair advantage by abusing their dominant market position. It must examine instances of discriminatory and anti-competitive practices of incumbents erecting high entry barriers to limit competition, and whether market dominance in one area translates into an unfair advantage in adjacent markets. It must ensure a level playing field. However, even while ensuring a competitive landscape, and nudging Big Tech to play by the rules of the land, considering the nature and characteristics of such digital markets, and the presence of network effects, the Commission must ensure that each instance of alleged dominance is examined independently. While it must implement its mandate, the CCI must be careful that its actions do not impede innovation. It must protect competition, not any competitor.