Startup founders bat for an Indian app store

NEW DELHI: A number of leading technology entrepreneurs are joining hands to petition the government seeking support to create an overarching Indian digital app ecosystem to counter what they view as the dominance of US technology giants Google and Apple.

At a meeting on Tuesday, the group discussed ways to establish a large-scale platform that will host local apps and break the duopoly of Google’s Play Store and Apple’s App Store, as well as a national-level lobby group to represent their interests, people privy to discussions told ET.

The founders, including Paytm‘s Vijay Shekhar Sharma, Yashish Dahiya of Policybazaar and Murugavel Janakiraman of Matrimony.com, also plan to approach the country’s banking regulator as well as the finance ministry seeking redressal for Google’s recent move to increase commission on purchases made on its app store.

‘App Neutrality’
Sources said such a move by Google would sound the death knell for the Indian startup ecosystem. “If India has net neutrality, why can’t we have app neutrality,” said Janakiraman, who added that over 80% of those accessing the internet in India do so through digital applications and “it can’t be completely controlled by Google since they own the Play Store.”

“A body monitored by the government can ensure app neutrality, fairness and openness,” he added.

Vishwas Patel, founder of payment gateway CCAvenue, said, “The government has to certainly step in and take the lead on this.”

“If there is some kind of restriction imposed due to geopolitical tensions, an Indian app store can save the day for everyone,” said Patel who is also the chairman of the Payments Council of India, a payments-centred industry body.

A government official said they have not received any request from the industry so far. “But we will take up the matter if they approach us,” the person said. Google did not respond to fresh queries sent by ET.

Terming the meeting as “an informal one” to collate issues from all stakeholders and identify grievances, CCAvenue’s Patel said the next step would be to identify the right authority to approach for resolution of multiple issues.

The group plans to approach the ministry of electronics and IT (MeitY) to push the case for an Indian app store while also approaching the Competition Commission of India, National Payments Corporation of India and the Central Board of Direct Taxes for other related grievances.

The need for an Indian app store gains urgency in the backdrop of India’s smartphone market being dominated by Google’s Android operating system.

Founders arguing against Google’s move to enforce a 30% commission on in-app purchases said that current Indian laws don’t allow any MDR (merchant discount rate) or transaction charge on UPI (Unified Payments Interface) transactions. “We are currently discussing which should be our first port of call,” said Patel. Also present at the meeting were founders of startups like ShareChat and Innov8, sources said.

The meeting was spurred by the ‘abrupt way’ in which Google decided to implement its policy. “The company is forcing developers to use its own payment gateway, it is also controlling how ads appear and there are issues on search; they seem to have an unabated power over the entire ecosystem which we are against,” said Patel.

Sources within Google said that there has been misinterpretation over the fact that only Google Pay can be used to make the payments. “Any UPI app can be used, and it’s not restricted to only Google Pay. People have confused Google Play billing with Google Pay billing,” said the person who did not wish to be identified.

The founders view the establishment of a body such as the NPCI, a public-private initiative enabling digital payments and settlement systems in India, as a goal post.

The multi-stakeholder model adopted by NPCI, an initiative of the country’s central bank and the several top banks of the country, has successfully managed to break the duopoly of “foreign card companies and has reduced dependence on them since RuPay card is used by close to 630 million people now”, people in the know of the discussions said.

On Tuesday, Google reiterated its policy under which it will deduct 30% commission for all in-app purchases for digital goods. While this will not impact physical deliveries such as ecommerce, food delivery or ride-hailing firms, it will dent the revenues of dating, education, video and music-on-demand, and other apps that rely on subscriptions from users.

Google said that the policy — which is being enforced globally — will only impact 3% of all apps on its ecosystem. The companies have the option of redirecting users to their own websites to download the app, it said. They can also use other third-party app stores to download the apps.

Such customised apps are already offered by handset manufacturers such as Xiaomi and Samsung. In India, users have the option of downloading apps from play stores run by local language operating system Indus and Bharat APK, which is already being touted as India’s first Atmanirbhar app store and has several gaming apps such as Paytm First Games. The government also has an app store, but it currently hosts only governance-centric apps.

Despite the overwhelming push for an Indian app store, some of those present at the meeting shared their concerns with ET. “Who will take care of issues such as safety and security on the Indian app store and who will ensure transparency,” said an executive.

Startup founders bat for an Indian app store Startup founders bat for an Indian app store Reviewed by TechCO on 10/05/2020 Rating: 5

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