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Indian startups explore alliance and alternative app store to fight Google’s ‘monopoly’

Google, which reaches more internet users than any other firm in India and commands 99% of the nation’s smartphone market, has stumbled upon an odd challenge in the world’s second-largest internet market: Scores of top local entrepreneurs.

Dozens of top startups and firms in India are working to form an alliance and toying with the idea of launching an app store to cut their reliance on Google, five people familiar with the matter told TechCrunch.

The list of entrepreneurs includes high-profile names, such as Vijay Shekhar Sharma, co-founder and chief executive of Paytm (India’s most valuable startup), Deep Kalra of travel ticketing firm MakeMyTrip, and executives from PolicyBazaar, Sharechat and many other firms.

The growing list of founders expressed deep concerns about Google’s “monopolistic” hold on India, and discussed what they alleged was unfair and inconsistent enforcement of Play Store’s guidelines in the country.

The conversations, which began in recent weeks, escalated on Tuesday after Google said that starting next year developers with an app on Google Play Store must give the company a cut of as much as 30% of several app-related payments.

Dozens of executives “from nearly every top startup and firm” in India attended a call on Tuesday to discuss the way forward, some of the people said, requesting anonymity. A 30% cut to Google is simply unfeasible, people on the call unanimously agreed.

Vishal Gondal, the founder of fitness startup GOQii, confirmed the talks to TechCrunch and said that an alternative app store would immensely help the Indian app ecosystem.

TechCrunch reached out to Paytm on Monday for comment and the startup declined the request.

In recent months, several major startups in India have also expressed disappointment over several of the existing industry bodies, which some say have failed to work on nurturing the local ecosystem.

The tension between some firms and Google became more public than ever late last month after the Android-maker reiterated Play Store’s gambling policy, sending a shockwave to scores of startups in the country that were hoping to cash in on the ongoing season of Indian Premier League cricket tournament.

Google temporarily pulled Paytm’s marquee app from the Play Store citing repeat violation of its Play Store policies. Disappointed by Google’s move, Paytm’s Sharma said in a TV interview, “This is the problem of India’s app ecosystem. So many founders have reached out to us… if we believe this country can build digital business, we must know that it is at somebody else’s hand to bless that business and not this country’s rules and regulations.”

Google has sent notices to several firms in India including Hotstar, TechCrunch reported last month. Indian newspaper Economic Times reported on Wednesday that the Mountain View giant had also sent warnings to food delivery startups Swiggy and Zomato.

Vivek Wadhwa, a Distinguished Fellow at Harvard Law School’s Labor and Worklife Program, lauded the banding of Indian entrepreneurs and likened Silicon Valley giants’ hold on India to the rising days of East India Company, which pillaged India. “Modern day tech companies pose a similar risk,” he told TechCrunch.

Some of the participating members are also hopeful that the government, which has urged the citizens in India to become self-reliant to revive the declining economy, would help their movement.

Other than its reach on Android, Google today also leads the mobile payments market in India, TechCrunch reported earlier this year.

The giant, which has backed a handful of startups in India and is a member of several Indian industry bodies, invested $4.5 billion in Mukesh Ambani’s telecom giant Jio Platforms earlier this year.

Ambani, who runs oil-to-retails giant Reliance Industries and is India’s richest man, is an ally of Indian Prime Minister Narendra Modi. Jio Platforms has attracted over $20 billion in investment from Google, Facebook, and 11 other high-profile investors this year.

The voluminous investment in Jio Platforms has puzzled many industry executives. “I see no business case for Facebook investing in Jio beyond saying we need regulatory help,” said Miten Sampat, a high-profile angel-investor on a podcast published Wednesday.

Google said in July that it would work with Jio Platforms on low-cost Android smartphones. Jio Platforms is planning to launch as many as 200 million smartphones in the next three years, according to a pitch the telecom giant has made to several developers. Bloomberg first reported about Jio Platform’s smartphone production plans.

These smartphones, as is the case with nearly 40 million JioPhone feature phones in circulation today, will have an app store with only a few dozen apps, all vetted and approved by Jio, according to one developer who was pitched by Jio Platforms. An industry executive described Jio’s store as a walled-garden.

A possible viable option for startup founders is Indus OS, a Samsung-backed third-party store, which last month said it reaches over 100 million monthly active users. As of earlier this week, Paytm and other firms had not reached out to IndusOS, a person familiar with the matter said.

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Facebook tests TikTok-style video format on its main app in India

Facebook is going all-in on short-form videos. After flirting with the idea in Lasso, a TikTok-clone it tested in select markets, and adding a similar feature called Reels to Instagram recently, the company is exploring a new venue for this TikTok -esque experience: The big blue app.

The company confirmed to TechCrunch that it is testing short-form videos in the Facebook app in India, its biggest market by users. In the current avatar, “Short Videos” has a dedicated section within the news feed. On top of it sits the “Create” button, tapping which prompts Facebook Camera to launch, and users can browse through videos by swiping up.

“We’re always testing new creative tools so we can learn about how people want to express themselves. Short-form videos are extremely popular and we are looking at new ways to provide this experience for people to connect, create and share on Facebook,” a Facebook spokesperson told TechCrunch.

Matt Navarra, a social media consultant, first revealed the existence of the new test.

The test comes as Facebook continues to cash in on the absence of TikTok, the ByteDance -owned app that was banned by India in late June. Facebook launched Reels in India last month, weeks before launching it to dozens of additional markets. A source familiar with the matter said the daily engagement of Facebook’s services in India has increased by more than 25% since the ban on TikTok.

Scores of local startups, including Twitter-backed ShareChat and Times Internet’s Gaana and MX Player streaming services, have launched standalone apps or integrated features to replicate the social experience TikTok provided to users in recent weeks. The local apps have claimed to have added tens of million of new users during the period.

YouTube has also rolled out a similar feature, still in testing phase, to more users in India in recent weeks.

Image: TechCrunch

The urgency in Facebook’s attempt to court users with short-form videos comes as TikTok is plotting ways to re-enter the market. ByteDance is engaging with Indian conglomerate Reliance Industries to sell stake in TikTok’s local business, TechCrunch reported earlier this week.

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Intel to invest $253.5 million in India’s Reliance Jio Platforms

Intel said on Friday it will invest $253.5 million in Jio Platforms, joining a roster of high-profile investors including Facebook, General Atlantic, and Silver Lake that have backed India’s top telecom operator in recent months.

The American chipmaker’s investment arm said it is acquiring a 0.39% stake in Jio Platforms, giving the Indian firm a valuation of $65 billion. Intel Capital is the 12th investor to buy a stake in Jio Platforms, which has raised more than $15.5 billion by selling a 25% stake since April this year.

“Jio Platforms’ focus on applying its impressive engineering capabilities to bring the power of low-cost digital services to India aligns with Intel’s purpose of delivering breakthrough technology that enriches lives. We believe digital access and data can transform business and society for the better,” said Wendell Brooks, Intel Capital President, in a statement.

The announcement today comes weeks after Mukesh Ambani, who controls Reliance Industries — the parent firm of Jio Platforms — suggested that Saudi Arabia’s PIF $1.5 billion investment on June 18 in his digital unit had marked the “end of Jio Platforms’ current phase of induction of financial partners.”

Ambani, who is India’s richest man, said on Friday that he was excited to “work together with Intel to advance India’s capabilities in cutting-edge technologies that will empower all sectors of our economy and improve the quality of life of 1.3 billion Indians.”

The new deal further illustrates the opportunities foreign investors see in Jio, a four-year-old subsidiary of Reliance Industries (India’s most valuable firm) that has upended the telecommunications market in India with cut-rate voice calls and mobile data tariffs. Jio has about 400 million subscribers.

Analysts at Bernstein said last month that they expect Jio Platforms to reach 500 million customers by 2023, and control half of the market by 2025. Jio Platforms competes with Bharti Airtel and Vodafone Idea, a joint venture between British giant Vodafone and Indian tycoon Kumar Mangalam Birla’s Aditya Birla Group.

Jio Platforms also operates a bevy of digital apps and services, including music streaming service JioSaavn (which it says it will take public), on-demand live television service JioTV and payments app JioMoney, as well as smartphones and broadband business. These services are available to Jio subscribers at no additional charge.

On Thursday evening, Jio Platforms launched JioMeet, a video-conferencing service that offers unlimited calls with “up to 24 hours” time limit on each session. The service, which currently has no paid plans, looks uncannily like Zoom.

Last month, Ambani said the funds in Jio Platforms had helped him clear oil-to-retail giant Reliance Industries’ net debt of about $21 billion. Ambani had originally pledged to clear Reliance’s debt due by early 2021.

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India’s richest man takes on Zoom

India’s Reliance Jio Platforms, which recently concluded a $15.2 billion fundraise run, is ready to enter a new business: Video conferencing.

On Thursday evening, the firm — backed by Mukesh Ambani, India’s richest man — formally launched JioMeet, its video-conference service.

Like Zoom and Google Meet, JioMeet offers unlimited number of free calls in high definition (720p) to users and supports as many as 100 participants on a call. But interestingly, it’s not imposing a short time limit on a call’s duration. Jio Platforms says a call can be “up to 24 hours” long. The service currently has no paid plans and it’s unclear if Jio Platforms, which has a reputation of giving away services for free for years, plans to change that.

Jio Platforms, which began beta testing JioMeet in May this year, said the video conferencing service offers “enterprise-grade” host controls. These include: password protection on each call, multi-device login support (up to five devices), and ability to share screen and collaborate.

Other features include the ability to switch “seemingly” from one device to another, and a ‘Safe Driving Mode’ for when a participant is in commute. Hosts can also enable a ‘waiting room’ to ensure participants have to ask for permission to enter a call.

Reliance Jio Platforms is taking on Zoom with JioMeet, which looks a lot like Zoom

JioMeet is available for use through Chrome and Firefox browsers on desktop, as well as has standalone apps for macOS, Windows, iOS, and Android. It also has an Outlook plugin.

In a call with analysts earlier this year, Jio executives had described JioMeet as a platform that they think would some day have features to enable doctors to consult their patients, prescribe them medicine, and have a system in place to let them buy medicines online and get test results digitally. Similarly, they said JioMeet will allow teachers to host virtual classrooms for their students, with the ability to record sessions, assign and accept homework, and conduct tests digitally.

JioPlatforms, which is India’s top telecom operator with about 400 million customers, operates a number of digital services including JioMusic, a music streaming service; JioCinema, which offers thousands of TV shows and movies; and JioTV, which allows users to watch more than 500 TV channels. All of these services are available at no additional charge to Jio Platforms subscribers. It costs less than $2 a month to be a Jio subscriber.

The launch of JioMeet today comes as tens of millions of Indians are working from home and using video conferencing services for work and to stay in touch with friends.

Zoom app, currently the most popular video conference service in India, on Android had about 35 million monthly active users in the third week of July, up from about 4 million users during the same period in March, according to mobile insights firm App Annie, data of which an industry executive shared with TechCrunch. (Android powers nearly 99% of smartphones in India.)

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