By Aditya Kalra and Munsif Vengattil
NEW DELHI (Reuters) -Google is likely to drop the apps of 10 companies in India, including some prominent matrimony apps, in a dispute over service fee payments, two sources with direct knowledge of the matter said, potentially sparking a showdown with startup firms.
The dispute centres on the startups’ efforts to stop Google from imposing a fee of 11% to 26% on in-app payments in India, after antitrust authorities ordered it to dismantle an earlier system of charging 15% to 30%.
But Google effectively received a go-ahead to charge the fee or remove apps after two court decisions in January and February, one by the Supreme Court, not to give any relief to startups.
The unit of Alphabet Inc has sent notices of Play Store violations to Indian companies Matrimony.com, which runs the app BharatMatrimony, and Info Edge, which runs a similar app, Jeevansathi.
Both companies are reviewing the notice and will consider next steps, their executives told Reuters.
Shares of Matrimony.com fell as much as 2.7% after the Reuters report, before paring losses, while Info Edge dropped 1.5%.
The move “literally means all the top matrimony services will be deleted,” Murugavel Janakiraman, the founder of Matrimony.com, told Reuters.
Info Edge founder Sanjeev Bikhchandani said it had cleared all pending Google invoices in a timely manner and was compliant with its policies.
In a blog post, Google said 10 Indian companies had chosen for an extended period of time not to pay for the “immense value they receive on Google Play”. It did not identify the firms.
“For years, no court or regulator has denied Google Play’s right to charge,” the company said on Friday, adding that the Supreme Court on Feb. 9 also “refused to interfere” with its right to do so.
Google’s app removal could anger the Indian startup community which has been protesting many of the U.S. giant’s practices for years.
The firm, which denies any wrongdoing, dominates the Indian market as 94% share of phones are based on its Android platform.
Google says its fee supports investments in the app store and the Android mobile operating system, ensuring free distribution, and covering developer tools and analytic services.
Just 3% of the more than 200,000 Indian developers who use the Google Play platform are required to pay any service fee, it added.
(Reporting by Aditya Kalra in New Delhi and Munsif Vengattil in Bengaluru; Editing by Tom Hogue and Clarence Fernandez)
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