The investigation follows a complaint from the Digital News Publishers Association, which promotes the interests of some of the country's biggest media firms.
The Competition Commission of India (CCI) is investigating whether Google is in violation of Section 4 of the Competition Act 2002, which relates to the abuse of dominant position.
“In a well-functioning democracy, the critical role played by news media can’t 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 stake-holders,” said the CCI in its 21-page order.
Digital News Publishers Association alleged that because their members get most of their online traffic from search engines Google’s dominance of this market has allowed it to force publishers to agree to unfavourable terms.
“The allegations of the informant, when seen in this vertically integrated ecosystem operated by Google, makes it prima facie appear that news publishers have no choice but to accept the terms and conditions imposed by Google,” said the CCI.
“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 forgo the traffic generated by Google for them, which would be unfavourable to their revenue generation," it added.
The Association said that because more than 50% of its members’ traffic comes through Google, the tech giant can use its algorithms to determine which news websites are found via search.
Furthermore, because Google is the major stakeholder in the digital advertising space it can determine the amount of advertising revenue to be paid to publishers for their content as well as the terms on which they are to be paid.
“No doubt, Google, being the gateway, generates substantial traffic for news publishers, but at the same time, the bargaining power imbalance and denial of fair share in the advertising revenue, as alleged by the Informant, merit detailed probe,” CCI said.
Keep up-to-date with publishing news: sign up here for InPubWeekly, our free weekly e-newsletter.
