- 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
ARTICLE HIGHLIGHTS
- 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.
INSIGHTS ON THE ISSUE
Context
Competition Commission of India(CCI):
Features:
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.
QUESTION FOR PRACTICE
Q. The Nobel Prize in Physics of 2014 was jointly awarded to Akasaki, Amano and Nakamura for the invention of Blue LEDs in the 1990s. How has this invention impacted the everyday life of human beings ?(UPSC 2021) (200 WORDS, 10 MARKS)
