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HomeTechLawmakers discuss predatory pricing, regulations and more with domestic tech companies

Lawmakers discuss predatory pricing, regulations and more with domestic tech companies

Top executives, startup founders and CEOs of Indian internet firms including Flipkart, , Oyo Hotels & Homes, Ola, , Swiggy, Makemytrip and others met a high-powered parliamentary panel headed by former minister of state for finance Jayant Sinha of the BJP on Thursday to discuss ‘Anti-competitive practices by Big-tech companies’.

Issues ranging from predatory pricing to platform neutrality were discussed in the backdrop of potential regulations for the sector.

The three-hour, closed-door meeting between the industry and the parliamentarians touched upon a series of hot-button topics that technology firms have grappled with globally amid fears of their unchallenged power.

Paytm founder Vijay Shekhar Sharma, Oyo founder Ritesh Agarwal, Flipkart group CEO Kalyan Krishnamurthy and MakeMyTrip cofounder Deep Kalra were among those present at the meeting.

A similar meeting by the Committee on Finance is expected to be held next week for international tech firms including Amazon, Google, Meta, Twitter, sources said.

The role of user data, regulations and how to define the market for these emerging internet businesses were some of the topics discussed, with parliamentarians getting the views of the industry on these subjects, said another source.

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Executives shared their misgivings about US technology biggies like Google and its Play Store policies – an ongoing tussle between internet firms which are reliant on the distribution prowess of these platforms. Startups have complained against Google’s billing policy, under which platforms have to pay a 30% fee to Google for in-app purchases. Its implmentation has been postponed to October 31, 2022 in India after a backlash from app developers.
ET reported on March 31 that the Competition Commission of india (CCI) found Google’s contentious payment billing system was ‘unfair and discriminatory’. Further hearings on the findings of the probe — tabled earlier this month — will begin shortly, ET reported.

Sinha had chaired a meeting in May with representatives from sectors like hospitality, restaurants, trader associations and startups, among others. The committee is expected to prepare a report based on these interactions.

According to people present at the meeting, domestic tech firms reiterated that overall digital penetration in ecommerce across segments is still low compared to the total offline retail market.

“There was discussion on the ride-hailing and the food delivery space – especially on the impact of the food-delivery platforms on restaurants..,” one of the people mentioned above said, adding these companies maintained they are compliant with regulations and are enabling offline businesses to grow further digitally.

“The meeting was also to understand how the government can further enable digital businesses to grow and the role of ecommerce in that,” this person added.

Another person said the idea was to start a dialogue between stakeholders and lawmakers to understand how best to enforce regulations. “Someone said that technology companies need to become big and only then regulations should be enforced else they will never be able to disrupt,” an internet firm’s representative said. However, the panel was not in agreement, saying some regulations need to come in instead of waiting for the companies to become too big.

Gig workers such as drivers and delivery staff, and the challenges they face were also discussed, apart from putting together a robust grievance redressal system, said another executive present at the meeting.

CCI is also currently probing food delivery firms over trade practices including deep discounting and high commissions. The probe was ordered after National Restaurant Association of India (NRAI) complained against Zomato and Swiggy last year.

Sources in the know added that there were discussions on defining the market in segments like hotel and ride-hailing as well. While the conflict between offline traders and ecommerce companies has been a topic of discussion for a few years now, food delivery firms are seeing increasing resistance from restaurant partners over various policy matters, including commission rates, private labels and cloud kitchen facilities.

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