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Google Contemplates Removing Apps from Indian Companies Over Fee Dispute

Kalyani Jha
01 Mar, 2024

In a recent development, tech giant Google is considering removing apps from ten Indian companies, including popular matrimony apps, amidst a disagreement over service fee payments, as reported by Reuters, citing sources familiar with the matter. This move could potentially escalate tensions with startup firms in the country.

The dispute revolves around the resistance of startups to Google's imposition of a service fee ranging from 11-26 percent on in-app payments in India. This comes after antitrust authorities mandated Google to dismantle its previous system, which charged fees between 15-30 percent.

Google has gained approval to enforce the fee or remove apps following court decisions in January and February. The Supreme Court's decision not to grant relief to startups played a crucial role in this authorization.

Alphabet Inc's unit, Google, has issued notices of Play Store violations to Indian companies Matrimony.com and Info Edge. Matrimony.com, responsible for the BharatMatrimony app, and Info Edge, operating a similar app named Jeevansathi, are currently reviewing the notices.

In response to this development, shares of Matrimony.com and Info Edge initially fell by 2.7 percent and 1.5 percent respectively after the news broke. However, the stocks have since recovered, with Matrimony.com trading at ₹545 and Info Edge at ₹5,291.15 at 1.35 pm.

Executives of both companies have stated that they are reviewing the notice and will consider the next steps. Murugavel Janakiraman, the founder of Matrimony.com, expressed concerns, stating, "The move means all the top matrimony services will be deleted." Meanwhile, Sanjeev Bhikchandani, founder of InfoEdge, emphasized compliance and stated, "To our mind, we have been compliant since February 9 on Jeevansaathi. We have paid all invoices on time."

In a blog post, Google highlighted that ten Indian companies had chosen not to pay for the significant value they receive on Google Play. It stressed its right to charge fees, citing the Supreme Court's decision on February 9, which refused to interfere with this right.

The potential removal of apps from Google's platform raises concerns within the Indian startup community, which has been critical of the company's practices. Google, with a 94 percent share of phones based on its Android platform, asserts that its fees support investments in the app store and Android OS, ensuring free distribution and covering developer tools and analytic services. Additionally, Google added that only 3 percent of over 200,000 Indian developers on the Google Play platform are required to pay any service fee.