Is Google anti-competitive in India? Cuts thinks so

First post, August 14, 2012

Google is once again in trouble. The search-engine-giant, which was recently fined $22.5 million for illegally tracking users of Apple’s popular Safari browser in the US, is now facing anti-competitive practice charges in India.

Minister of State for Corporate Affairs, R P N Singh announced yesterday that the Competition Commission of India has received information for contravention of section 4 of the Competition Act, 2002, by Google. The section pertains to the abuse of dominant position by a market player.

According to a Reuters report, Google spokeswoman Paroma Roy Chowdhury said the company was cooperating with the CCI. “We’re confident that our products are compliant with competition law in India,” she said in a statement.

So what exactly has Google done which has caused the CCI to investigate?

The first complaint was filed by an advocates group, Consumer Unity and Trust Society, in August last year when they wrote a letter of complaint to the chairperson of CCI.

The letter stated,

CUTS believes that Google can potentially engage in anticompetitive activities to the possible detriment of these markets in India and that therefore such activities in this regard need to be thoroughly investigated by the CCI.

The initial complaint, thus does appear to be based more on the idea that Google can potentially destroy fair-competition online rather than giving any proof as to how it exactly poses a threat. But CUTS is backing up its claim with some examples.

According to an Economic Times report, which quotes Uday Mehta, associate director at CUTS International as saying, ”

“CUTS conducted a thorough study on Google and we have come across instances where the firm is abusing its dominant position. CCI had asked us to further investigate. For instance, if you search for Facebook founder Mark Zuckerberg on Google, the first five results are on his Google Plus pages. His Facebook page was the 8th result.”

However when we did a search for Mark Zuckerberg, we found Wiki entries and news articles as initial results before one Google Plus result and then a Facebook result showed up.

Earlier in February this year, BharatMatrimony filed a complaint against Google alleging that the multinational company has engaged in discriminatory and retaliatory practices relating to AdWords. The site alleged that rivals matrimonial sites were getting indexed more in Google AdWords.

The AdWords programme, in which Google sells keywords to advertisers and displays them in the form of short ads online, is a big money spinner for the company. Again the BharatMatrimony case did not point how Google discriminated against the site but it was assumed in May, by the CCI that on the basis of prima facie evidence that Google was indeed abusing its position.

The need to probe a dominant search engine for potential discriminatory practices is of course important. India’s growing e-commerce industry is dependent on search sites like Google and its ad-exchange system. Tinkering of results, can mean losses for a lot of small websites which are just starting out in India

This news item can also be viewed at: