Big tech trouble: Bill that may end monopoly moves
₹4,000 crore or global revenue of over $30 billion, and with over 10 million end-users or 10,000 business users in India. Nine ‘core’ services have been identified, including search engines, social networks, browsers and e-commerce aggregators. The bill does not allow for bundling of services, self-preferencing, restricting third-party apps or data cross-sharing, among other mandates.
This bill suggests that a new law is needed because the existing Competition Act, 2002 could not “imagine the current scale of digitalization." As a result, while Big Tech firms fall directly under the bill’s ambit, large India-based startups too will have to comply. Legal experts say Big Tech will struggle to function with restrictions in cross-sharing of data, as well as unbundling of services. Currently, popular tech platforms work as ecosystems of services.
Mandating unbundling with penalties may dilute user-experiences of most apps that right now work seamlessly. Breaking this up could affect innovation. Unbundling services by a tech firm may lead to users having to grant permission for every single feature.
Experts say the proposal could lead to regulatory confusion in terms of how such services are defined. Non-compliance penalties are as high as 10% of a firm’s global revenue, while incorrect submission penalties are up to 1% of a company’s global revenue. The draft bill has raised questions among legal and policy experts on whether the regulations are workable.
Most digital services come from firms with successful tech products, so multiple apps fall under one tech umbrella. The bill forbids this. Global investors feel such a law could go against the ability of firms, even Indian ones, to innovate.
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