OTT industry body, IDMIF, has shot off a letter to the competition watchdog, calling the commission charged by the tech giant unjustified.
IDMIF that counts some of the biggest names in the OTT streaming space including Disney+Hotstar, Zee5, Voot, SonyLIV, Manorama Max, Discovery+ among others, approached the regulator a day after a Tamil Nadu court restrained Google from removing Disney+Hotstar from its app store and ordered it to charge the service a commission of just 4%.
As per the report, the letter to CCI states that the new user choice billing system could mean the end of ‘business operation for smaller TV channels and OTT players’, especially in the content curation space. In response, the CCI has asked IDMIF to submit the evidence with regards to this claim.
Disney+Hotstar platform is the first non-India OTT player to contest Google's new billing mandates. While developers were liable for commissions in the range of 15-30% under the previous Google Billing and Payments System (GBPS), the new user choice billing (UCB) system has brought down the rate by 4% to 11-26% under the new regime.
When the mandates were announced, Indian startups quickly approached various Courts across the country including Delhi and Madras HC to seek injunction on the new commission slabs. There is a risk that the regulator will recognize Google's commission for in-app purchases as monopolistically high, noted Anton Maslov, an analyst at the BRICS Competition Centre.
As noted by Economic Times, Indian streaming platforms are worried about Google web-billing as a payment option for OTTs. Critics believe that while big players have the leeway and customer traction to leverage such a move, smaller Indian players may bear the brunt of customer attrition as the users may not be well-versed with the idea of web-billing.
Indian startups fear that users would rather opt for in-app purchases, which would be liable for heavy commission and hurt their revenues.
Sources: The Economic Times, Inc42
