Making them pay: About the regulation of Big techs

Synopsis: A law to regulate app store operators is key to check Big Tech’s monopolising nature.

Introduction

Recently, South Korea made an amendment to its Telecommunications Business Act. The Act aims to prevent app store operators, such as Google and Apple, from forcing app developers to use their in-store payment systems. It will also check the unfair use of their market position.

Why South Korea made this amendment?

This has happened because of the case involving Apple and Epic games. Here, Apple ousted Epic from its platform, for putting up its own payment system, which bypassed Apple’s payment systems.

Same laws/ initiatives by other countries

Australia: Recently made a law to make Internet platforms, pay media companies for displaying their content. Now the government is in the process of bringing digital payment services such as Apple Pay, Google Pay and WeChat Pay under its regulatory ambit.

European Union: EU draft law seeks to make large platform companies as gatekeepers”. The EU want the gatekeepers to comply with a set of dos and don’ts. This will give the smaller companies a fair chance to compete in the market. This draft law is also aimed at giving more choices to the customers.

USA: Introduced a bill to promote competition and reduce the gatekeeper power in the app economy. The bill aims to increase choice, improve quality, and reduce costs for consumers.

In Indian context

Apple is facing an antitrust challenge in India from a Rajasthan-based non-profit organization called ‘Together We Fight Society’ on this issue. Last year, CCI (Competition Commission of India) also started investigations into similar allegations against Google.

What should India do?

India can also enact such a law. As such a law cannot be called as radical. Further, the Government had recently set up Open Network for Digital Commerce to “democratise e-commerce” and “to provide alternatives to proprietary e-commerce sites”. So such laws are the need of the hour, given the challenge of protecting and encouraging the smaller players.

Source: This post is based on the article “Making them pay” published in The Hindu on 8^th   September 2021.

Terms to know

• Competition Comission of India