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Google delists Indian apps; Paytm distances itself from banking arm
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The tussle between Google and Indian internet companies over Play Store policies intensified on Friday with the US tech major delisting some local apps. Details on this and more in today’s ETtech Top 5.
Also in this letter:
■ SME IPOs for tech companies
■ ETtech Deals Digest
■ Potential of Google’s Genie AI
![Google Play store legal battle THUMB IMAGE ETTECH Google Play store legal battle THUMB IMAGE ETTECH](https://img.etimg.com/photo/msid-108143599/Google Play store legal battle THUMB IMAGE ETTECH.jpg)
Google on Friday began removing the apps of 10 Indian companies over non-payment of service fees, the latest move in the tussle over its Play Store billing policies, which developers have opposed.
Apps de-platformed: Info Edge's flagship apps Naukri.com and 99acres were delisted by Google, in addition to BharatMatrimony, and Shaadi.com. Other apps that have been taken down include online dating apps Truly Madly and QuackQuack, vernacular video-streaming platform Stage, Balaji Telefilms’ Altt, and audio streaming and podcast app Kuku FM.
Startups cry foul: Murugavel Janakiraman, founder and MD of Matrimony.com, said the delisting of the apps on a Friday “does not give us the opportunity to seek legal remedies.”
“In a blatant violation of the CCI order, Google has delisted some of the most well-known apps in India without any forewarning. While there was a Supreme Court judgement on February 9 denying interim relief, the least that was expected from Google was to send a notice to developers,” Mittal told ET.
‘No wrongdoing’: Info Edge India founder and vice-chairman Sanjeev Bikhchandani said the company, which operates job-listing portal Naukri.com and matrimony site Jeevansathi, has been compliant with Google's Play Store policies.
“There are no pending invoices of Google with us. All have been paid in a timely manner,” he added.
Developers notified: Earlier in the day, Google said in a blog post that it will begin enforcing its App Store billing policies, warning that non-compliant apps could go off its store.
Google said that ten Indian companies did not pay for “the immense value they receive on Google Play” for an extended period of time. It, however, 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 SC also “refused to interfere” with its right to do so.
Industry body’s response: The Internet and Mobile Association of India (IAMAI) on Friday advised Google not to delist any apps from Google Play. “The affected members of IAMAI are of the view that a substantive hearing of the case is pending before the Supreme Court of India, and Google should not take any coercive action during the pendency of the case,” it said.
Also read | IAMAI forms task force to tackle Big Tech dominance
![Paytm ED investigation Paytm ED investigation](https://img.etimg.com/photo/msid-108142271/Paytm ED investigation.jpg)
One 97 Communications on Friday said the board has approved the discontinuation of inter-company pacts with Paytm Payments Bank to reduce dependencies.
Driving the news: In a stock exchange filing, One 97 Communications, which owns and operates Paytm, said the company and its associate entity, Paytm Payments Bank Limited (PPBL), have introduced additional measures to strengthen their approach towards independent operations of PPBL.
“As part of this process to reduce dependencies, Paytm and PPBL have mutually agreed to discontinue various inter-company agreements with Paytm and its group entities,” the BSE filing read.
Also read | On KYC compliance front, payment aggregators may be second to some
Shareholders cheer: Following this announcement, shares of One97 Communications on Friday jumped 5%, to end the session at Rs 425.45 each on the BSE.
![Paytm share price movement 1 Mar 2024 Graphic ETTECH Paytm share price movement 1 Mar 2024 Graphic ETTECH](https://img.etimg.com/photo/msid-108142393/Paytm share price movement 1 Mar 2024 Graphic ETTECH.jpg)
We reported on February 29 that SoftBank Group offloaded a 2.2% stake in Paytm between January 23 and February 26 through the open market. Post-sale, SoftBank holds a 2.83% stake in the company.
In other news: On Friday, the finance ministry’s Financial Intelligence Unit-India (FIU-IND) has imposed a fine of Rs 5.49 crore on Paytm Payments Bank for “violating its obligations” under the Prevention of Money Laundering Act.
Background: This comes at a time when PPBL is battling regulatory challenges over persistent non-compliance and continued material supervisory concerns.
In January, the RBI barred PPBL from accepting fresh deposits or top-ups in customer accounts, wallets, FASTags, and other instruments after February 29 - a deadline that was later extended to March 15.
Subsequently, Paytm founder Vijay Shekhar Sharma stepped down as part-time non-executive chairman of PPBL, and the board of the bank was reconstituted.
Read our in-depth coverage on RBI’s action on Paytm bank
![IPO ETtech IPO ETtech](https://img.etimg.com/photo/msid-108142859/IPO ETtech.jpg)
In the face of a prolonged funding winter and declining venture capital funding, new-age companies can explore listing on the Small and Medium Enterprises (SME) boards, early-stage venture backer Blume said in its latest report.
Details: Startups that are not seeing a lot of interest from growth investors, or hitting a growth ceiling and “feel better to build profitably than burn for growth” should be exploring IPOs (initial public offerings) on the SME boards of Indian exchanges, the VC firm noted in its Indus Valley report 2024.
Blume’s comments come at a time when growth- and late-stage deals have seen a substantial dip as risk investors get wary and matured startups fear valuation down rounds in a bear market.
Outperformer: The IPO market has remained buoyant amid the funding crunch, but SME IPOs have consistently outperformed their main board brethren, attracting investor attention as they provide increased liquidity and exits, according to the report.
SME board IPOs saw a rise from 109 issues in 2022 to 182 issues in 2023. Even the total worth of these issues increased from Rs 1,900 crore to Rs 4,700 in 2023. In contrast, main board IPOs showed an increase from 38 issues in 2022 to 59 issues in 2023. However, the total issue size was much larger at Rs 497.6 billion in 2022 and Rs 589.8 billion in 2023.
Why support SME? Blume said the rationale behind backing the SME board for an IPO is that only a quarter (1,046 of 4,522) of listed companies in India trade above the $250 million market (or above Rs 2,000 crore) capitalisation in India.
![Startup funding Startup funding](https://img.etimg.com/photo/msid-108142427/Startup funding.jpg)
Startup funding in the last week of February 2024 fell about 59% in volume terms to 12 deals from the same period a year ago, totalling $171 million.
The month of February saw startups raise $516 million across 82 rounds, versus $551 million across 109 rounds a year ago.
![Overall funding trend for Indian startups Overall funding trend for Indian startups](https://img.etimg.com/photo/msid-108143020/Overall funding trend for Indian startups.jpg)
Companies in seed, early and late-stages had raised about $186 million from 29 rounds in the period from February 23 to March 1, 2023, as per data from Tracxn.
![Top funding rounds during Top funding rounds during](https://img.etimg.com/photo/msid-108143030/Top funding rounds during.jpg)
Late-stage funding – at $124.5 million - accounted for about 73% of the overall deal value this week, followed by the seed stage at $31 million, or 18%.
![most active VCs this week most active VCs this week](https://img.etimg.com/photo/msid-108143037/most active VCs this week.jpg)
Sundar Pichai, CEO of Google and Alphabet
Google DeepMind, the artificial intelligence (AI) research arm of Google, recently released Genie, an image-to-video AI model that can generate fully interactive, playable games from real-world images or even human-made sketches.
What is Genie? Genie, which stands for Generative Interactive Environments, is an 11-billion-parameter AI model that can create action-controllable virtual worlds described through text, images, photos and handmade sketches.
How is it different? Although the model is not publicly available, AI researchers said that despite not being trained on action or text annotations, Genie’s foundation model can determine who the main character is and enable a user to control that character in the generated world.
How will it aid game developers? “Genie’s ability to generate games from concepts is quite interesting which would empower aspiring developers and potentially lead to a surge of creative game ideas,” said Kashyap Reddy, cofounder and CEO of Indian game startup Hitwicket.
Today's ETtech Top 5 newsletter was curated by Megha Mishra in Mumbai.
Also in this letter:
■ SME IPOs for tech companies
■ ETtech Deals Digest
■ Potential of Google’s Genie AI
Google removes some Indian apps from Playstore citing non-compliance
![Google Play store legal battle THUMB IMAGE ETTECH Google Play store legal battle THUMB IMAGE ETTECH](https://img.etimg.com/photo/msid-108143599/Google Play store legal battle THUMB IMAGE ETTECH.jpg)
Google on Friday began removing the apps of 10 Indian companies over non-payment of service fees, the latest move in the tussle over its Play Store billing policies, which developers have opposed.
Apps de-platformed: Info Edge's flagship apps Naukri.com and 99acres were delisted by Google, in addition to BharatMatrimony, and Shaadi.com. Other apps that have been taken down include online dating apps Truly Madly and QuackQuack, vernacular video-streaming platform Stage, Balaji Telefilms’ Altt, and audio streaming and podcast app Kuku FM.
Startups cry foul: Murugavel Janakiraman, founder and MD of Matrimony.com, said the delisting of the apps on a Friday “does not give us the opportunity to seek legal remedies.”
“In a blatant violation of the CCI order, Google has delisted some of the most well-known apps in India without any forewarning. While there was a Supreme Court judgement on February 9 denying interim relief, the least that was expected from Google was to send a notice to developers,” Mittal told ET.
‘No wrongdoing’: Info Edge India founder and vice-chairman Sanjeev Bikhchandani said the company, which operates job-listing portal Naukri.com and matrimony site Jeevansathi, has been compliant with Google's Play Store policies.
“There are no pending invoices of Google with us. All have been paid in a timely manner,” he added.
Developers notified: Earlier in the day, Google said in a blog post that it will begin enforcing its App Store billing policies, warning that non-compliant apps could go off its store.
Google said that ten Indian companies did not pay for “the immense value they receive on Google Play” for an extended period of time. It, however, 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 SC also “refused to interfere” with its right to do so.
Industry body’s response: The Internet and Mobile Association of India (IAMAI) on Friday advised Google not to delist any apps from Google Play. “The affected members of IAMAI are of the view that a substantive hearing of the case is pending before the Supreme Court of India, and Google should not take any coercive action during the pendency of the case,” it said.
Also read | IAMAI forms task force to tackle Big Tech dominance
Paytm secures board nod to cease pacts with Payments Bank
![Paytm ED investigation Paytm ED investigation](https://img.etimg.com/photo/msid-108142271/Paytm ED investigation.jpg)
One 97 Communications on Friday said the board has approved the discontinuation of inter-company pacts with Paytm Payments Bank to reduce dependencies.
Driving the news: In a stock exchange filing, One 97 Communications, which owns and operates Paytm, said the company and its associate entity, Paytm Payments Bank Limited (PPBL), have introduced additional measures to strengthen their approach towards independent operations of PPBL.
“As part of this process to reduce dependencies, Paytm and PPBL have mutually agreed to discontinue various inter-company agreements with Paytm and its group entities,” the BSE filing read.
Also read | On KYC compliance front, payment aggregators may be second to some
Shareholders cheer: Following this announcement, shares of One97 Communications on Friday jumped 5%, to end the session at Rs 425.45 each on the BSE.
![Paytm share price movement 1 Mar 2024 Graphic ETTECH Paytm share price movement 1 Mar 2024 Graphic ETTECH](https://img.etimg.com/photo/msid-108142393/Paytm share price movement 1 Mar 2024 Graphic ETTECH.jpg)
We reported on February 29 that SoftBank Group offloaded a 2.2% stake in Paytm between January 23 and February 26 through the open market. Post-sale, SoftBank holds a 2.83% stake in the company.
In other news: On Friday, the finance ministry’s Financial Intelligence Unit-India (FIU-IND) has imposed a fine of Rs 5.49 crore on Paytm Payments Bank for “violating its obligations” under the Prevention of Money Laundering Act.
Background: This comes at a time when PPBL is battling regulatory challenges over persistent non-compliance and continued material supervisory concerns.
In January, the RBI barred PPBL from accepting fresh deposits or top-ups in customer accounts, wallets, FASTags, and other instruments after February 29 - a deadline that was later extended to March 15.
Subsequently, Paytm founder Vijay Shekhar Sharma stepped down as part-time non-executive chairman of PPBL, and the board of the bank was reconstituted.
Read our in-depth coverage on RBI’s action on Paytm bank
- User complaints spiked at Paytm Payments Bank even before RBI action
- Banks, fintechs eye Paytm’s staff benefits business
- Elevation Capital’s massive gamble on Paytm backfires
- Paytm’s forex woes: Understanding the role of fintechs in cross-border payments
- FM tells regulators to meet fintechs, startups every month
- RBI allows Paytm’s UPI payment business to be migrated to other banks
Smaller IPOs an alternative for shrinking VC exits: Blume report
![IPO ETtech IPO ETtech](https://img.etimg.com/photo/msid-108142859/IPO ETtech.jpg)
In the face of a prolonged funding winter and declining venture capital funding, new-age companies can explore listing on the Small and Medium Enterprises (SME) boards, early-stage venture backer Blume said in its latest report.
Details: Startups that are not seeing a lot of interest from growth investors, or hitting a growth ceiling and “feel better to build profitably than burn for growth” should be exploring IPOs (initial public offerings) on the SME boards of Indian exchanges, the VC firm noted in its Indus Valley report 2024.
Blume’s comments come at a time when growth- and late-stage deals have seen a substantial dip as risk investors get wary and matured startups fear valuation down rounds in a bear market.
Outperformer: The IPO market has remained buoyant amid the funding crunch, but SME IPOs have consistently outperformed their main board brethren, attracting investor attention as they provide increased liquidity and exits, according to the report.
SME board IPOs saw a rise from 109 issues in 2022 to 182 issues in 2023. Even the total worth of these issues increased from Rs 1,900 crore to Rs 4,700 in 2023. In contrast, main board IPOs showed an increase from 38 issues in 2022 to 59 issues in 2023. However, the total issue size was much larger at Rs 497.6 billion in 2022 and Rs 589.8 billion in 2023.
Why support SME? Blume said the rationale behind backing the SME board for an IPO is that only a quarter (1,046 of 4,522) of listed companies in India trade above the $250 million market (or above Rs 2,000 crore) capitalisation in India.
ETtech Deals Digest | Funding for startups falls 59% to 12 deals this week
![Startup funding Startup funding](https://img.etimg.com/photo/msid-108142427/Startup funding.jpg)
Startup funding in the last week of February 2024 fell about 59% in volume terms to 12 deals from the same period a year ago, totalling $171 million.
The month of February saw startups raise $516 million across 82 rounds, versus $551 million across 109 rounds a year ago.
![Overall funding trend for Indian startups Overall funding trend for Indian startups](https://img.etimg.com/photo/msid-108143020/Overall funding trend for Indian startups.jpg)
Companies in seed, early and late-stages had raised about $186 million from 29 rounds in the period from February 23 to March 1, 2023, as per data from Tracxn.
![Top funding rounds during Top funding rounds during](https://img.etimg.com/photo/msid-108143030/Top funding rounds during.jpg)
Late-stage funding – at $124.5 million - accounted for about 73% of the overall deal value this week, followed by the seed stage at $31 million, or 18%.
![most active VCs this week most active VCs this week](https://img.etimg.com/photo/msid-108143037/most active VCs this week.jpg)
ETtech Explainer | How Google’s Genie AI will impact gaming
![Inauguration of a new Google AI Hub in Paris Inauguration of a new Google AI Hub in Paris](https://img.etimg.com/photo/msid-108142490/Inauguration of a new Google AI Hub in Paris.jpg)
Google DeepMind, the artificial intelligence (AI) research arm of Google, recently released Genie, an image-to-video AI model that can generate fully interactive, playable games from real-world images or even human-made sketches.
What is Genie? Genie, which stands for Generative Interactive Environments, is an 11-billion-parameter AI model that can create action-controllable virtual worlds described through text, images, photos and handmade sketches.
How is it different? Although the model is not publicly available, AI researchers said that despite not being trained on action or text annotations, Genie’s foundation model can determine who the main character is and enable a user to control that character in the generated world.
How will it aid game developers? “Genie’s ability to generate games from concepts is quite interesting which would empower aspiring developers and potentially lead to a surge of creative game ideas,” said Kashyap Reddy, cofounder and CEO of Indian game startup Hitwicket.
Today's ETtech Top 5 newsletter was curated by Megha Mishra in Mumbai.
Want this newsletter delivered to your inbox?
I agree to receive newsletters and marketing communications via e-mail
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