Digital Competition Bill may impact user experience on online platforms | News

This requirement, the study argues, will impact the seamless experience of consumers, and may enhance the effort and time of users while using a digital service.

As many as thirteen platforms, including Zomato, Swiggy, Paytm, IRCTC, Makemytrip, Flipkart, JioSaavn, Pharmeasy, and others, would come under the purview of the Digital Competition Bill (DCB), according to the current conditions prescribed under the bill, the study revealed.

According to the draft bill, large digital platforms providing core digital services are designated as Systemically Significant Digital Enterprises (SSDEs) if they meet certain financial and user thresholds.

Explaining how the bill will impact Indian companies too, apart from the big techs, the paper, citing the example of Paytm, said that the company will now have to separate or “unbundle” its services under the requirements of the proposed regulations.

“This means that the ability to provide multiple interconnected services within a single application will be restricted. As a result, it is also assumed that this unbundling may have potential implications for the convenience and smooth user experience that Paytm users currently enjoy,” said the paper.

Further, in this context, it is assumed that the implementation of DCB would lead to the separation of Paytm’s various services into distinct standalone apps, according to the study.

“Basically, all the super apps are getting captured under this, as they are today offering us different core digital services under one umbrella – tied and bundled together. But this bill says that no, you cannot do that,” said an industry expert.

The unbundling clause under the DCB is inspired by the similar requirement under the European Union’s Digital Markets Act which prohibits gatekeepers (big firms) from tying and bundling their core platform services and imposing restrictions on switching or changing default pre-installed services.

Unbundling of services may also result in the loss of personalised, cross-service recommendations that users previously enjoyed, as a result of which, there is a possibility of decreased user engagement and reduced usage of the online platforms, said the study.

Under the user threshold criteria, any firm with over 10 million end-users or 10,000 business users in its core digital service will be considered SSDE and, therefore, will be subjected to the proposed ex-ante regulations.

“So to say that this is a bill which only focuses on the top four or top five big companies or foreign companies is completely untrue. The truth is that it applies to a much larger number of Indian companies,” said another industry executive.