Home Analysis How will Big Tech trouble impact India

How will Big Tech trouble impact India

With the US bringing in antitrust charges and India planning to regulate data, big tech companies are bound to see structural changes

The US Department of Justice recently filed a lawsuit against Google accusing it of abusing their dominance in the digital space and restricting competitors. The anti-trust charges have led to critical questions about the future operations of big tech companies. And with these firms coming under the radar for violating anti-trust laws and compromising data globally, the impact on India is inevitable.

This is also in line with the fact that US authorities have guided the Competition Commission of India (CCI) when it was starting off in 2003. Google has been questioned by the CCI multiple times in the last two years about anti-trust violations. This has ranged from anti-competitive practices in the commercial flight search market to the Android phone and Smart television market. In its 14-page order, the CCI said that to have financial deals with phone makers to pre-install Google apps was unfair to other businesses and consumers.

Google India has also been accused of having an unfair commission mechanism to list an app on its Play Store. With India’s plans of regulating personal and non-personal data, big tech companies are bound to see structural changes in the country.

“In terms of quantum penetration and sheer numbers, Google comes to your head because it’s the fundamental everyone operates with in India. It has permeated in the user base by becoming the permanent app by default,” said Ramesh Kailasam, CEO IndiaTech.org in a panel discussion.

Larger players have more access to data and can use this to increase their market dominance, while smaller players might have only a marginal share of data. “The most important thing is making this data available for many people to innovate and create new businesses,” Kris Gopalakrishnan, Chariman of the committee of Non-Personal Data, told Livemint.

Giants like Google and Amazon have been accused of being anti-competitive and establishing monopoly by reducing prices, giving deep discounts, or even offering free services. “They start as free and then entrap you once you are used to it, everyone needs to then pay for this kind of bundling. The risk now is that the device is now present in strong penetration,” Kailasam added.

Currently, Google’s search engine market share in India stands at 94.87%, meanwhile Amazon stands at 47% in the online smartphone sales market.

Recently, Amazon refused to appear before the Indian Parliament for a questioning regarding the Data Protection Bill. Although Amazon gave not being to travel during the pandemic as a reason, Meenakshi Lekhi, chairperson of the Join Committee of Parliament (JPC) and BJP MP,s aid Amazon’s refusal to appear amounts to a breach of parliamentary privilege. She also said the panel would take coercive action, if no Amazon representative appears the next time.

India has seen strong aspects of bundling and deep discounts with Reliance’s Jio. Launched in 2016, Jio gained rapid popularity by multiple cheap or free deals for users. It offered free services for almost a year after its launch.

“We have never thought of making laws against anything that is free in India,” said outgoing Telecom Regulatory Authority of India (TRAI) Chairman RS Sharma, to Livemint.

India is not new to concerns of monopolisation. A recent survey revealed that 20 most profitable firms in India contribute to 70% of the country’s profits. With its own monopoly concerns, how will India prevent domination from big tech companies, global and local?

“The goal shouldn’t be to reign in global Big Tech by creating a domestic Big Tech. The threat of Reliance dominating key markets is real and the competition authority should step in,” Urvashi Aneja, director of Tandem Research and associate fellow at Chatham House, was quoted as saying by Livemint.

The Google anti-trust lawsuit is said to be the most significant legal action on technology giants in recent times. Earlier, Microsoft faced a similar legal battle in 1998. There are several speculations of the next probable move from the US Department of Justice. It is highly expected that, like AT&T in 1974, Google will be split into multiple companies, to reduce monopoly.

“Competition in the industry is vitally important, which is why today’s challenge against Google- gatekeeper of the Internet — for violating anti-trust laws is a monumental case, both for the DOJ and the American people,” said Attorney general William Barr in the lawsuit. “This lawsuit strikes at the heart of Google’s grip over the internet for millions of American consumers, advertisers, small businesses and entrepreneurs beholden to an unlawful monopolist,” he added.

Experts have expressed that India requires a “whole government” approach in dealing with issues of big tech domination and data sharing.

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