The NCLAT will continue to hear today Google's appeal against the CCI order imposing a penalty of ₹1337 crore on the tech giant for its alleged anti-competitive behaviour in the Android mobile ecosystem.
#NCLAT #Google #CCI
#NCLAT #Google #CCI
The Bench of NCLAT Chairperson Justice Ashok Bhushan and Dr Alok Srivastava, Member (Technical) will hear Google's submissions.
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#NCLAT #Google #CCI
Kathpalia: Unlike Apple, Google has been an open system... But we needed to set standards and it is for this purpose that we have this anti-fragmentation agreement. It only prescribes a minimum standards.
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#NCLAT #Google #CCI
Kathpalia: Our agreement does not stop Original Equipment Manufacturers from innovation. There are 15000 versions of android. There is no dearth of innovation. All that our agreement says that you maintain this baselines standard.
Kathpalia: This is the system we designed in 2008. Please see how this has flourished. There are 3.5 million apps on our PlayStore today.
Kathpalia: In India alone there was 27 billion downloads of these applications. When Android came in 2012, the average price of an android phone was ₹18,000. Today, it is down to ₹10,000.
#NCLAT #Google #CCI
#NCLAT #Google #CCI
Kathpalia: all of this has been possible because of the system we evolved. Today, smartphones are available across the country. the cost of internet has gone and that has helped but accessing that has been because of these phones. Apple is not there. It is Android that is there.
Kathpalia: There are 1100 manufacturers competing today for the market. They compete on price, innovation, features, user interface. That is competition. Can it be said that Android is anti-competitive platform?
Kathpalia: Samsung phones look different from One Plus. Within Samsung there are different designs. This is because of our Anti-Fragmentation Agreement (AFA).
Kathpalia: The CCI should have kept these critical facts in mind before giving any findings on the AFA.
Kathpalia: CCI concerns itself with three issues. The first it says is imposition of anti-forking imposition agreements.
#NCLAT #Google #CCI
#NCLAT #Google #CCI
Kathpalia: It means Google says that on Mobile Application Distribution Agreement (MADA) devices you have to maintain these standards. We say if you are in MADA you cannot go into other ecosystem. You cannot say you will have five devices in our system and five in other.
Kathpalia: there is an android open source project. That is made available to everyone.
Kathpalia: The AFA ensure that those baseline standards are met and that those apps function on all android devices.
#NCLAT #Google #CCI
#NCLAT #Google #CCI
Kathpalia: Samsung is a MADA signatory. So it can't do a fork on Android. However, it can develop its own operating system independently. For example, Samsung independently has an operating system named Tizen.
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#NCLAT #Google #CCI
Kathpalia: The third issue is that it imposes anti forking obligations on OEMs against manufacturing in markets which were not subject matter of investigation like Television etc.
Kathpalia: It meant that not only was a MADA signatory is barred from forking on other operating systems but even television. But this was not the subject matter of CCI investigation so there was no point going into that.
On the first issue, the CCI rules in my favour that there is no problem in imposing anti-forking on MADA devices: Kathpalia.
The CCI says that OEMs who have entered into MADA cannot develop forks and they have therefore been denied to innovate in the fork sector. The first question is that is there even a single OEM which has been handicapped because of that? Everything is hypothetical: Kathpalia.
Bench: Once an OEM gets tied up with AFA and MADA then he can't develop his own OS.
Kathpalia: Inherent in an OEM signing a MADA is compatibility... The allegation is that a MADA signatory is precluded from developing an Android fork.
Kathpalia: Inherent in an OEM signing a MADA is compatibility... The allegation is that a MADA signatory is precluded from developing an Android fork.
Kathpalia: The first question should be asked is has any OEM said it wants to develop an Android fork. The CCI recognises that compatibility is in the interest of OEMs.
Kathpalia now takes the court through Sony's response to AFA.
The DG asks for benefits of fragmentation and Sony replies there are no benefits. This is the evidence. Kathpalia.
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#NCLAT #Google #CCI
Kathpalia: Even the Samsung says that they have no desire to develop an Android fork.
#NCLAT #Google #CCI
#NCLAT #Google #CCI
There are several others who say anti-fragmentation agreement is critical. These positive statements do not find any mention in the CCI order: Kathpalia.
#NCLAT #Google #CCI
#NCLAT #Google #CCI
Kathpalia: The allegation now is extension of AFA to MADA signatory. Amazon is not a signatory. It is extraordinary what is happening here. You have no evidence so you turn around and use Amazon which is not a MADA signatory.
Kathpalia: There are so many problems with this para 565. Amazon Fire never entered India. Where is Amazon Fire OS in mobile sector being handicapped India. Number 2 it is not a MADA signatory.
Kathpalia: They say Amazon failed because of google's condition. But the truth is that Amazon failed because Amazon Fire OS was an inadequate system.
Kathpalia: The finding that innovation is affected must fail.
Kathpalia: They say that please make my proprietary software available to Android forks. We are grateful to CCI for not saying give your search algorithm to Bing
Kathpalia: If google develops some IP outside of the Android Open Source Apache License, nobody has a right to that. No body has any right to any API outside that license. That is why they are my proprietary APIs.
Kathpalia: What is incentive for me to innovate if am made to share my IP with all and sundry and my competitors.
Bench asks Kathpalia if APIs are must haves for Android devices.
Kathpalia: They do not define what is a must have. How would it be a must have if another OS like apple is functioning without it.
Kathpalia: They do not define what is a must have. How would it be a must have if another OS like apple is functioning without it.
Kathpalia: They have their own APIs. My Android has its own APIs. These are proprietary to all those OS. so on what basis does CCI turn around and say that these are must haves.
Kathpalia: If you want scientific development and you say I impeded it then these developments must develop their own APIs. In so far as my ecosystem is concerned, at most, it can be considered a must in my ecosystem. My APIs are available to everybody under MADA.
Kathpalia: So this must have is a baseless finding. This is not an airport, this is not a necessary facility.
They say that I shall allow the developers of app stores to distribute their app stores through my Play Store. There has been no discussion on this aspect: Kathpalia.
The problem with this at many level. There has been no finding of infringement against me. It is an ultra vires of the Competition Act. The only place where my play store is considered is when they consider the question of dominance: Kathpalia.
Kathpalia: That is problem no. 1. Problem no. 2 is somebody's house is being put in my house. Problem no. 3: I have a very strenuous mechanism in place before I allow any app to be downloaded from my store.
Bench: There is some screening for these apps?
Kathpalia: Yes. There is very strenuous screening. If i find that any app is in violation they are put to notice. For example gambling apps. As a policy we do not allow gambling apps.
Kathpalia: Yes. There is very strenuous screening. If i find that any app is in violation they are put to notice. For example gambling apps. As a policy we do not allow gambling apps.
Kathpalia: I need to make sure no malware comes on play store. Consider this, I put a competitor's app store. Someone enters that app store and I don't know what screening methods are. Malware can come in the system. Not only is the direction ultra vires...
...it is mala fide and without any thought.
In another direction, they say Google shall not restrict the ability of app developers, in any manner, to
distribute their apps through side-loading: Kathpalia.
distribute their apps through side-loading: Kathpalia.
Kathpalia: Now under the IT Rules, I am an intermediary. My role is define which includes ensuring integrity of the systems. When a side-loading happens, there will be no scrutiny by anybody.
Kathpalia: When such side-loading happens, a warning will come. Now this is an obligation on me under the IT Rules. That is the only interference that comes, a warning.
Whenever side-loading happens, every browser will put the user to notice: Kathpalia.
Bench: That is not a restriction but an alert.
Kathpalia: Yes. I don't know where this direction comes from. This principle of warning has been upheld by the High Court.
Bench: That is not a restriction but an alert.
Kathpalia: Yes. I don't know where this direction comes from. This principle of warning has been upheld by the High Court.
Kathpalia is referring to this judgement.
barandbench.com/news/litigatio…
barandbench.com/news/litigatio…
Kathpalia: Thisfiinding of the CCI is also ultra vires.
Kathpalia now refers to CCI's directions on the issue of pre-installation and placement of Google's apps in a device.
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#NCLAT #Google #CCI
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