Context

• In 1890, Senator John Sherman famously declared, ‘If we will not endure a king as a political power, we should not endure a king over the production, transportation, and sale of any of the necessaries of life.’
• With these words, the Sherman Antitrust Act was born, laying the foundation for modern competition law in the United States and inspiring similar legislative frameworks across the globe, including in India.
• Although the nature of what constitutes a necessity of life has evolved, Sherman's warning against monopolistic dominance remains chillingly relevant in the 21st-century digital economy.
• India, with its booming tech landscape and ambitious economic goals, now finds itself grappling with monopolistic practices by global digital giants, especially in how they shape access, discovery, and monetization for domestic start-ups.

The Digital Economy and India’s Ambitions

• India's digital economy contributed 11.74% to the nation's GDP in 2022–23, marking it as a central pillar of national development.
• The explosion of start-ups, from 2,000 in 2014 to over 31,000 in 2023, signals a thriving entrepreneurial spirit.
• The government envisions these start-ups as engines of growth for its ambitious $35 trillion ‘Viksit Bharat’ vision by 2047.
• However, while technological infrastructure enables innovation, the pathways of digital commerce and discovery are often dominated by foreign tech giants, resulting in distorted market dynamics that can stifle homegrown potential.

Gatekeeping and Market Power in the Digital Age

• One of the most glaring manifestations of this gatekeeping is Google’s overwhelming dominance in the digital distribution ecosystem.
• With Android capturing around 95% of India’s mobile OS market, Google essentially controls how Indian consumers discover and interact with digital products.
• Indian start-ups are therefore compelled to operate within Google’s ecosystem, paying high commissions on in-app transactions and competing under discriminatory terms that tilt the market in favour of select players.
• A recent complaint to the Competition Commission of India (CCI) by a major Indian gaming start-up underscores this imbalance.
• The complaint centres on Google's Real Money Gaming (RMG) Pilot Program, which selectively allowed only two gaming formats, Daily Fantasy Sports (DFS) and rummy, on its Play Store, effectively excluding other legitimate gaming formats.
• This discriminatory policy granted unfair advantages to a handful of operators, with one DFS company reportedly acquiring 55 million users in just one year through the program.
• Meanwhile, advertising policy changes cut off vital promotional avenues for other gaming businesses, despite their prior reliance on Google’s ad network for over two-thirds of app downloads.

Antitrust and the Broader Economic Impact

• Such market distortions have far-reaching economic implications.
• When dominant players favour select partners, it reduces competition, which in turn limits innovation, consumer choice, and product quality.
• Over-reliance on a few digital gatekeepers weakens the resilience of the digital ecosystem and jeopardizes long-term economic goals.
• This is particularly dangerous for a developing economy like India, which depends heavily on inclusive growth driven by new ideas and start-ups.
• The United States offers a cautionary tale: the unchecked rise of monopolies has led to a significant decline in Initial Public Offerings and increased entry barriers for new businesses.
• If similar monopolistic trends continue unchecked in India, the cost will be borne not just by start-ups, but also by consumers and the economy at large.

The Way Forward: Towards a Fairer Digital Market

• It is clear that global tech giants like Google play a foundational role in the digital ecosystem.
• However, their responsibilities must match their power.
• The Indian government and institutions like the CCI must work to ensure that the digital economy is a level playing field, where innovation is not stifled by exclusionary practices or market manipulation.
• The case filed by the Indian gaming company is more than a corporate dispute, it is emblematic of a broader push for fair competition and market access.
• It echoes Sherman’s call to resist economic kingship and promotes a digital future where distribution and monetization are democratized, not monopolised.

Conclusion

• Senator Sherman’s 19th-century concerns find startling resonance in 21st-century India.
• As the country charges ahead in its digital revolution, it must remain vigilant against monopolistic forces that can derail its aspirations.
• With the right regulatory interventions, India can ensure that its start-up ecosystem remains dynamic, competitive, and fair, delivering on the promise of Viksit Bharat and carrying forward Sherman’s legacy into the digital age.