US court’s $90 million fine on Google boosts Indian app developers’ case

Ayushi Kar | | Updated on: Jul 01, 2022
The Indian app ecosystem has had similar complaints against Google

The Indian app ecosystem has had similar complaints against Google | Photo Credit: MARKO DJURICA

Mobile app developers have been asserting that app store monopolies of Apple and Google have been detrimental to the growth of small app developers

San Francisco’s federal court ruling, mandating Google to pay $90 million in settlement to app developers, has encouraged Indian developers to push for a similar ruling against the tech major in India. Mobile app developers worldwide have been asserting that the app store monopolies of Apple and Google have been detrimental to the growth of small app developers. This is why Indian app developers welcomed the American court’s ruling on the class action filed by Android app developers, which mandated Google to set up a fund of $90 million to support app developers who made $2 million or less in annual revenue from 2016–2021.

The Google Play store is the only way to distribute apps on Android phones, which accounts for a significant chunk of the phones owned by the population, thus giving them the monopoly to dictate market conditions. The app developers, in a lawsuit filed in federal court in San Francisco, accused Google of using agreements with smartphone makers, technical barriers, and revenue sharing agreements to effectively close the app ecosystem and shunt most payments through its Google Play billing system with a default service fee of 30 per cent (This commission was halved by Google last year).

The Indian app ecosystem has had similar complaints against Google. The Alliance of Digital India Foundation, a think tank for more than 400 Indian start-ups, has vocalised their displeasure with Google’s ability to dictate these prices unilaterally.

Sijo Kuruvilla George, Executive Director, ADIF, said in reaction to Google’s mandate to reduce Google Play Store commission by 15 per cent last year, “What developers are asking for is fairness and not benevolence in the form of a reduced commission. Price discovery should be left to market forces.”

Thus, Indian app developers, who also have multiple cases pending against Google, have welcomed the precedence set by the American court ruling enthusiastically.

Vishal Gondal, founder and CEO of GOQii, told BusinessLine, “The US court ruling against Google is reassuring to the Indian developer ecosystem. There is already a case with the Competition Commission of India on this subject. We look forward to a positive resolution of the same in the next calendar year.”

In fact, the Director General of CCI submitted a report on Google Play Store billing policies, noting that Google is imposing “unfair and discriminatory” conditions in violation of India’s regulations. It also said the company’s conduct in India is leading to “denial of market access” to other apps that use the government’s unified payments interface (UPI) payments system.

Abhishek Malhotra, Managing Partner, TMT Law Practice, who represented WinZO against Google in the Delhi HC noted, “The California court’s landmark decision will have a persuasive impact, influencing Indian courts and anti-trust authorities to render decisions in favour of app developers, which will ultimate Google to arrive at an amicable settlement with app developers.”

Published on July 01, 2022
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