The Competition Commission of India (CCI) instructed its director general to conduct a 60-day investigation into a “prima facie” imbalance of power between news publishers and Google in the Indian marketplace. 

It alleges that Google is acting in violation of provision 4(2) of the Competition Act, following a complaint by the Digital News Publishers Association (DNPA; India’s publishers association) that Google “had abused its dominant position in news aggregation, leading to advertising losses for publishers to the extent that they receive only 51% of the advertising spend.” The investigation would be able to examine the issues in a comprehensive manner by giving an opportunity to all concerned to present their case, the CCI said.

“In a well-functioning democracy, the critical role played by news media cannot be undermined, and it needs to be ensured that digital gatekeeper firms do not abuse their dominant position to harm the competitive process of determining a fair distribution of revenue amongst all stakeholders,” the CCI said.

A prima facie case

In its 21-page order, the CCI said news publishers, prima facie, “have no choice but to accept the terms and conditions imposed by Google … . Google appears to operate as a gateway between various news publishers on the one hand and news readers on the other. Another alternative for the news publisher is to forego the traffic generated by Google for them, which would be unfavourable to their revenue generation.” 

The commission also took note of the developments in France and Australia, where “Google has been asked to enter into fair/good faith negotiation with news publishers for paid licensing of content to address the bargaining power imbalance between the two and the resultant imposition of unfair conditions by Google. 

“No doubt,” it added, “Google being the gateway, generates substantial traffic for news publishers, but at the same time bargaining power imbalance and denial of a fair share in the advertising revenue as alleged by the informant, merit detailed investigation.”

The CCI’s broader case against Google in India

This isn’t the first time Google has been taken to task in India.

The tech giant is very much in the regulatory crosshairs in India, the Hindustan Times noted, saying, “This is the fifth such investigation opened into the tech behemoth’s practices in the country. Under scrutiny are products, services, and policies … The CCI has already fined Google 135.86 crore [around US$34 million] in 2018 for bias in search results, a space where the tech giant is the leader globally,” the newspaper reported, adding that “the findings indicate Google’s search results were tailored to favor the companies on services and partners while also deploying advertising services to disadvantage some advertisers over others.”

Publisher allegations

The DNPA, which consists of the digital arms of some of India’s biggest media firms, said its members get more than half of their traffic from online search engines, a category Google clearly commands, and the market-leading position has allowed Google to force the publishers into several unfavourable terms,” according to Tech Crunch.

Among the DNPA’s other charges:

1. Unfair conditions: In view of Google's market position in the online digital advertising intermediation services, the alleged unilateral and non-transparent termination and sharing of ad revenues appears to be an imposition of unfair conditions on publishers.
2. Snippets: Google’s display of snippets of news items limits the number of visitors to news outlets and impacts the ad revenue while Google continues to earn ad revenue on its result page as well as enriches its search algorithm resulting from the volume of search queries. 
3. Arbitrary terms: The terms of the agreements entered between news publishers and Google for sharing the advertisement revenues are unilaterally and arbitrarily dictated by Google and news publishers have no other option but to accept the terms as they are, with no bargaining power whatsoever.
4. Unfair imposition of AMP format: Publishers are being forced to build mirror image Web sites using the AMP format, with Google caching all articles and serving the content directly to mobile users, with revenue implications for publishers. Likewise, Google restricts paywall options unless publishers rebuild their paywall options and their meters for AMP, which may amount to an unfair imposition on publishers.

Publisher response

One INMA member we spoke with off the record believes the director general’s investigation will lead to actions that ensure a fair level playing field in the Indian news industry, as well as for the entire Indian start-up ecosystem across all areas where Google acts as a dominant player. The political climate in India is, they told us, most definitely favourable to news publishers and is becoming more favourable with every passing month.

What news publishers are seeking, they told us, is fairness and transparency — whether it comes via the Australian or the European Union model. Indian news publishers want a level playing field that will enable them to create a sustainable business model that focuses on providing trusted, high-quality journalism.

The source feels good about the way things are moving: “We are confident that justice will prevail.”

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