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EDITORIAL ANALYSIS : Big Tech and the need in India for ex-ante regulation


Source: The Hindu


  • Prelims: Competition Commission of India (CCI), Indian Competition Act 2002, Open Network for Digital Commerce (ONDC) platform etc
  • Mains GS Paper II: Achievements in the field of Science and technology, indigenisation of technology, Issues of big tech companies etc


  • Competition Commission of India (CCI) imposed a penalty of ₹1,337 crore on Google for abusing its dominant position in the android mobile device ecosystem.




Competition Commission of India(CCI):




Market dominance issue:

  • Case of Google:
    • Intent of Google’s business was to make users on its platforms abide by its revenue-earning service.
    • Network effects, along with a status quo bias: It created significant entry barriers for competitors to enter or operate in the markets concerned.
  • Issue of competition law: By the time an order is passed, the dominant player has gained an edge, as in the case of
  • Predatory pricing entails the lowering of prices that forces other firms to be out competed.
    • Amazon and Flipkart: accused of deep discounting and creating in-house brands to compete with local sellers.
  • Self-preferencing beyond the search algorithms: It is the bundling of services, especially with pre-installed apps, where the manufacturers eliminate competition without the consumer’s consent.
    • Case of Apple in the U.S. and Europe: over pre-installed apps after Russia forced Apple to provide third-party apps at the time of installation.
  • There is sensitive data stored on these platforms (financial records, phone location, and medical history): Big corporations have asserted ownership of the right to use or transfer this data without restriction.
  • Other issues:
    • Poorer quality of services
    • Data monopoly
    • Stifle innovation



Way Forward

  • Competition (Amendment) Bill, and its proposed amendments: They partially address the issues.
    • India should overhaul its competition law, especially when the Bill is due to be passed in Parliament’s winter session.
  • Global practices: EU’s Digital Market Act and “gatekeepers, who enforce rules and regulations ex-ante to foresee anti-competitive practices.
  • There is an urgent need for ex-ante legislation to prevent market failures and mitigate possible anti-competitive conduct.
  • It is essential to establish an ex-ante framework to ensure a level playing field for local sellers.
    • The Government’s Open Network for Digital Commerce (ONDC) platform is a reliable option for these small players.
  • The storage and collection of women’s and children’s data need to be dealt with more cautiously to build a safe digital place.
  • For a consumer: there is a need to establish harmony of the Competition law with the new Consumer Protection Act 2020 and e-commerce rules.
  • The new law should include a mechanism to ensure fair compensation for consumers who face the brunt of the anti-competitive practices of the Big Techs.
    • Penalties and restrictions imposed on companies ensures proportionate compensation for consumer losses.
  • Opportunity for new MSME’s: With India now on the cusp of a digital transformation, it is essential that the country has a level-playing field to ensure a fair opportunity for new-age start-ups and Micro, Small and Medium Enterprises.
  • There is an urgent need to contextualize the law to the digital marketplace and devise new provisions with adequate ex-ante legislation.
    • Example: The EU’s Digital Markets Act.
  • India needs a new ex-ante-based framework that promotes competition by ensuring a level-playing field for the big, the small, the old and the new.



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