On January 07, 2022, pursuant to a complaint filed by Digital News Publishers Association, the CCI directed an investigation against Alphabet Inc., Google LLC, Google India Private Limited and Google Ireland Limited (collectively ‘Google’) over allegations concerning abuse of dominant position.^[1]

The informant, an association to promote, aid, help, encourage, develop, protect and secure the interest of digital news publishers, alleged the following against Google’s practices in digital advertising qua news publishers:

a.     Unfair Terms & Conditions: Google had imposed unfair conditions on the members of the informant, while allowing website links of the members of the informant on their search engine results by unilaterally and arbitrarily dictating the terms of the agreements entered between them. Google gives a small chunk of revenues generated from advertisements on websites of the members of the informant;

b.     Use of Snippets: Google uses snippets of the content created by the members of the informant but does not fairly compensate them for the use of such content;

c.     Limiting/ restricting technical development and denial of market access: By depriving the informant’s members of the ‘fair value’ of content, Google is discouraging innovation, development and betterment of content created by news media companies and has also denied them access to the digital advertising space.

d.     Requirement of implementing AMP Standard: Google requires the publishers to implement Accelerated Mobile Pages (‘AMP’) standard – else, the publishers lose critical placement in mobile search, resulting in reduced traffic. Google caches all articles in AMP format and serves content directly to mobile users. For AMP articles, Google restricts paywall options unless news publishers rebuild their paywall options and meters for AMP. The only alternative for news publishers is to subscribe with Google, which benefits Google to the detriment of news publishers.

e.     Leveraging: Google is using its dominant position in the market for online general web search, market for online general web search services and market for online advertisements to enter into and protect its position in the market for advertising in the news space.

In its analysis, the CCI found Google to be dominant in the ‘market for online general web search services in India’, ‘market for online search advertising services in India’ and ‘market for online digital advertising intermediation services’. The CCI observed that the alleged unilateral and non-transparent determination and sharing of ad revenues prima facie appeared to be an imposition of unfair condition on publishers per the CCI. Furthermore, the CCI held that critical aspects such as data and audience management practices, or generation and sharing of revenue with publishers, exacerbated the information asymmetry and were prima facie prejudicial to the interest of publishers. On the allegation concerning snippets, the CCI observed that the readers do not click on the snippets to enter the news publisher websites (as the snippet itself is sufficient to address the query) – this may limit the ad revenue earning potential of news publishers while Google would continue to earn ad revenue on its result page as well as by enriching its search algorithm resulting from the volume of search queries. With respect to the remainder allegations, the CCI noted that the issues raised by the informant merited further investigation.

Based on the above, the CCI formed a prima facie view that Google violated the provisions of Section 4(2)(a), 4(2)(b)(ii), 4(2)(c), and 4(2)(e) of the Competition Act and thus, directed the DG to conduct an investigation.

[1] Case No. 41 of 2021.