Economic Highlights
New Delhi, 23 January
2023
Monopoly Helps Google India
EARNINGS UP Rs 64 bn A YEAR
By Shivaji Sarkar
Internet giants are having fortunes
in India for weak anti-trust or monopoly laws. Google alone repatriates Rs 64
billion or $79 lakh in 2021. In contrast Microsoft earned Rs 9475 crore. The Competition
Commission of India (CCI) found Google has a monopolistic anti-competitive
policy edging out others in competition and slapped Rs 2274.2 crore penalties
in two separate cases. It moved the Supreme Court, which refused stay on one
penalty payment of Rs 1337.76 crore for abusing tech giant’s dominant position
in the Android system and Play Store policies. This has raised a glimmer of hope
against checking the malpractices of internet giants.
The watchdog CCI’s order issued in
October 2022, is indication how the country is being bled by tech giants of
billions or more every year. It calls for a massive overhaul of the
competition, monopolistic, restrictive trade practices and related laws. India
as it liberalised replaced the MRTPC Act 1969 with Competition Act 2002 and
implemented it in September 2009.
Additional Solicitor General N
Venkatraman and senior advocate Mukul Rohatgi, who appeared for a private
company, OS Labs Technology, told the court that Google was discriminating
against a “third world country” like India. The CCI’s landmark order swoops
down on the internet giant for virtually preventing a competitive atmosphere or
having monopolies for earning higher profits.
The European Commission in 2020 told
Google to pay Euro 8 billion for anti-trust breaches in three cases. In yet
another case, the EC found that Google's favouring of Google Shopping had a
negative impact on consumers and innovation. The Google has faced many such
cases against it, including from the Microsoft since 2009.India is learning
from the EC rulings. The US Justice Department’s lawsuit, filed by the Trump
administration, alleged that Google violated anti-trust law in how it
maintained dominance in search engines and advertising.
The CCI order is only indicative of
the losses that the internet giant’s activities caused to the Indian users of
the search engines. The practitioners find that it denies them access to
another system and even discriminates against various other players like Yahoo
or other non-Google mailing systems even prevents joining various conference applications
or registrations.
This apart, each of its applications
demanding access to critical personal contact and other details breach privacy,
personal safety and is hazardous. The apprehensions are that such prospected
data boosts profits and incurs heavy losses to each user.
Even otherwise the Telecommunication
Department can act to prevent the irrational and illegal demands of the apps to
access personal contacts, photographs and sensitive documents. The CCI, in its
October 20 press release says that it examined various practices of Google
licensing of Android mobile operating system and various proprietary mobile
applications of Google (e.g. Play Store, Google Search, Google Chrome, YouTube,
etc.).
The CCI found that Google contravened
provision of the Competition Act and perpetuated its dominant position in the
online search market resulting in denial of market access for competing search
apps in contravention of Sec 4 (2)(c) of the act preventing abuse of dominant
position.
In real application this gives a
company an advantage and prevents benefits that could have accrued to other
players. The CCI order is a pointer to the need of stricter implementation of
the law to safeguard the interests of the users. It wants Google to follow the
same set of compliance in Indian market as directed by European Commission (EC)
in July 18 on a finding of dominance by Google in the Android ecosystem.
The company has faced many complaints
in the EC, including Microsoft-backed PR firm, Infederation (Foundem) since
2009. Since 2010, the European Union has investigated several antitrust complaints
against Google alleging abuses of its dominant position in breach of the
EU’s competition laws - relating to Google shopping, the Android operating
system and to Google AdSense.
The apps, according to an online
Google answer, can rake in billions of dollars each year though it claims that
“majority of apps don’t make any sort of money at all”.Each year Google earns
Rs 64 billion from India. In 2018, it had the highest earnings of Rs 94
billion. In worldwide operations, Google in 2016 earned $ 19 billion - $ 602
per second, or about $ 3600 a minute. In 2021, it earned $ 76 billion. The EC
actions are to check aggressive and non-competitive practices that may be
paying it large dividends.
Each time Google faces such cases it
seeks time for implementation of orders. It has done it in Europe and the US as
well. Its lawyer Abhishek Manu Singhvi sought 45 days from the Supreme Court to
comply with its orders and to provide a choice screen for customers to allow
customers default search engine. He said it needed four months citing that even
in Europe the company was given nine months to implement it.
It means that despite the CCI order
and stay refusal by the SC, the customers would have to wait. The choice-based
search-engine system is not foolproof as it would be offered only once at the
time initial device set up, as per Singhvi’s submission to the court. The
customer apparently having chosen it once cannot change it in future. This
would be a severe restriction.
So, the Indian consumers in reality
would not have a choice. Singhvi’s offer is a devious method of denial. This
calls for a revamp of the competition, IT and other laws for ensuring level
playing field and safeguards. The access to phone information like income tax
personal account number can wreak havoc with any person’s finances.
The companies are also using the
so-called updates to play with a person’s personal computer functioning. The
ways to prevent such misuse of the system has to be incorporated in the laws.
Since computer applications are being extended to various kinds of machines and
even cars, the violations by companies are becoming hazardous. Tesla is known
to misuse to the extent of locking the car systems, it has sold to
anyone. It unlocks the system after a heavy “user fee” extortion.
This interference is against the
basics of any proprietary law. The misuses of the information technology are
wider than can be anticipated. India must enact new anti-trust laws to
ensure safer search-engine internet uses and related computer safety. ---INFA
(Copyright, India News & Feature Alliance)
|