Google Created Digital Data Hegemony, Says CCI Before NCLAT

Fair trade regulator CCI alleged on Thursday that Google had created digital data hegemony and called for a market space with “free, fair and open competition”.

Concluding the arguments of the Competition Commission of India (CCI) before the NCLAT Appellate Tribunal in the Google case, Additional Solicitor General N Venkataraman said that a market with greater freedom for all players would be in full sync with the principles of free competition rather than the ‘walled garden’ approach of the internet major.

On October 20 last year, the ICC imposed a penalty of Rs. 1,337.76 crores on Google for anti-competitive practices regarding Android mobile devices. The regulator had also ordered the internet major to cease and desist from various unfair business practices.

This decision was challenged in the National Company Law Appellate Tribunal (NCLAT).

On Thursday, Venkataraman said Google had used its profitable search engine as a “castle” and the rest of the other apps to play the defensive role of “ditch”. This “castle and moat” strategy is data hegemony, which means that a big market player tends to get bigger and bigger while a small entrant struggles to reach a critical mass of users and of user data.

According to him, data capture and data deployment are leveraged and monetized as ad revenue. When choice is the guiding principle of competition law, Google’s hegemony reduces both choice and competition.

Venkataraman pointed out that the implementation of the remedies provided by the ICC would go a long way towards having a market with greater freedom for all players, which would be in full synchronization with the principles of free competition rather than with the approach ” walled garden” from Google.

Google’s abuse of dominance is proven in all of the criteria set out in Section 4 of the Competition Act in terms of mandatory pre-installation, prime placement, and core app bundling. Such practices result in the imposition of unfair conditions and additional obligations, he said.

He also pointed out that app tying allowed Google to use its dominant position in one relevant market to penetrate and protect other relevant markets.

In his remarks, Venkataraman mentioned that big data gateways such as GST and UPI, which hold data on millions of people and entities, are run for the public good by public institutions.

However, when it comes to private entities, engaging in a digital business where there is a constant and unstoppable flow of data and traffic, the same is ingeniously calibrated for the sole benefit of those entities. Competition law is an important pillar in democratizing data and achieving the goal of the greatest good for the greatest number, he argued.

The NCLAT began its hearing in the Android case on February 15, following a direction from the Supreme Court. The Supreme Court had ordered the NCLAT to rule on the appeal by March 31.

On January 4, a separate NCLAT bench issued a notice regarding Google’s plea, ordering it to pay 10% of the rupees. Fine of 1,337 crores imposed by the ICC. He had refused to stay the ICC order and submit the case to a final hearing on April 3, 2023.

This was challenged by Google in the Supreme Court, which also declined to stay the TCC order but ordered the NCLAT to rule on Google’s appeal by March 31.