Google’s battle with India’s most valued tech unicorn just intensified

The battle lines are drawn.
The battle lines are drawn.
Image: REUTERS/Amit Dave
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Today (Oct. 5), India’s most valued tech unicorn Paytm announced it has launched its own “mini app store” where Indian startups can leverage its extensive distribution network free of cost.

Within minutes of this announcement, Google published a blog post stressing it is “deeply committed to the success of the Indian ecosystem.”

The internet search major, which owns the Android smartphone operating system, also said it is postponing the enforcement of its new Play Store billing policy in India to April 2022. The new policy allows Google to ensure it gets as high as a 30% cut on in-app purchases made through Android apps. Globally, the new policy will be implemented in September 2021.

“We are setting up listening sessions with leading Indian startups to understand their concerns more deeply. We will be setting up Policy Workshops to help clear any additional questions about our Play Store policies,” said Purnima Kochikar, director of business development of games and applications at Google Play.

Paytm versus Google

The conflict between Paytm and Google has been simmering for several weeks now.

On Sept. 18, Paytm’s app was temporarily removed from the Google Play Store on allegations that it violated developer guidelines on real-money gaming. While the app was restored within hours, Paytm issued a statement alleging that Google was trying to suppress a formidable rival. “This will be familiar to all Indian internet companies since they face similar arm-twisting and fear of Google’s dominance over India’s digital ecosystem every day,” Paytm said in a statement on Sept. 20.

Over the last two weeks, several news reports claimed that some prominent Indian entrepreneurs, including Paytm’s founder and CEO Vijay Shekhar Sharma, were discussing the option of backing an alternate app store to fight Google’s monopoly.

Last week, around 150 startups in India forged an informal coalition to express concerns over Google’s policy for mandating that developers listed on its Play Store use its billing service. Google levies a 30% commission on any transaction made for a digital product or service through its in-app billing system.

Paytm was at the forefront of voicing opposition against Google.

Now, Paytm’s “mini app store” hopes to “build a sustainable and thriving local technology ecosystem that resonates with the true spirit of Atmanirbhar Bharat (self-reliant India).”

As of now, the mini app store offers direct access to discover, browse, and pay without downloading or installing separate apps. More than 300 app-based service providers such as ride-hailing major Ola, bike taxi firm Rapido, online pharmacies Netmeds and 1MG, and food ventures FreshMenu and Domino’s Pizza have already joined the programme,  Paytm said.

The app store had been running in beta version with select users and witnessed over 12 million visits in the month of September, as per Paytm.