Startups in India are now being encouraged to build their own apps store in an effort to evade the strict Google requirements for the apps they sell.
“We want to offer customers more choices and higher quality and we’re building a full ecosystem so the alternatives are available,” said Umang Bedi, co-founder of Next Big Sound, which is building a third-party app store for mobile music. “If the so-called gatekeeper [Google] won’t allow it to be built, we will go ahead and build it ourselves.”
Google recently imposed new rules that effectively gave it the final say in approving app stores in India. The move came as Google faced a backlash from both in India and in the United States for refusing to allow Android-based devices to play internet radio service Spotify, due to insufficient storage space on the device. The company eventually relented and Spotify is now available on Android devices running Lollipop, but the incident suggests Google still doesn’t have complete control over which apps reach its users in India.
“The player in control of search share to that market determines who gets downloaded or how it gets downloaded,” Bedi said. “This can influence the way customers go about buying and using things.”
The startup is in the process of setting up a website and a shopping system for third-party developers to build their own store, with costs ranging from $35 to $60 per month.
Google has been attempting to accelerate the growth of Android in India, where Google sells no Nexus smartphones and the only Android phones it offers in the country are cheap flip phones that run on competing operating systems. But to reach a broader audience and combat app store competition, Android must be open to competitors.
“If you’re not open about it, it’s not a sustainable business,” Bedi said. “If you’re locked into doing things how you do them, you can’t experiment.”
Google’s mobile partner relationship in India has been almost impossible for many startups to navigate, said Facebook co-founder and chief executive Mark Zuckerberg, at the Web Summit conference in Lisbon in November.
“Given that app stores don’t work in India, it seems like a way to make it possible for a startup to do something they’re interested in,” Zuckerberg said of the new rules at the time. “I do think [India’s] taking a hard policy stance, which, if it doesn’t win out, will lead to some unintended consequences.”
Bedi is already recruiting developers to build music apps that compete with Play Music and rival the potential of Spotify’s streaming service. Other startups, such as Delhi-based MyCity4U that organizes shopping events for residents, are also developing their own apps.
“We want to be a platform, and Facebook just decided to make all the apps they have available in India on our platform,” said Kiran Grewal, founder of MyCity4U. “We’ve got some investments behind us and eventually we would like to add our own apps.”
If Apple opens a stores in India or Yahoo! Yahoo! takes a stake in Flipkart, the online retail company, India will become the world’s largest e-commerce market in value, surpassing the United States, according to estimates from Forrester Research, giving startups a path to reach both local and international customers.
“We think that’s an additional opportunity,” said Abhay Jain, founder of UrbanClap, an online marketplace. “If they build some kind of product, that’s huge.”
After more than a year of effort, he and other app developers say they are cautiously optimistic about their prospects in the world’s largest mobile market.
“We are talking to people [about investing],” Grewal said. “I’m sure eventually it will happen, but we’re not really betting on it right now.”