Have already unbundled services, complied with CCI order: Google India head

Company will comply with 'laws of the land' and requirements of regulators, says Sanjay Gupta

Google India conducted its annual summit on Thursday, making a slew of announcements in areas like Cloud and digital lending. SANJAY GUPTA, country head and vice-president at Google India, spoke to Surajeet Das Gupta and Sourabh Lele about subjects ranging from local manufacturing of smartphones to the changes in digital advertising. Edited excerpts from an interview in Delhi.

There is a lot of focus on Make in India. Google recently announced plans to manufacture Chromebook devices in India. What is the thinking on India production of Pixel phones?
 

As announced, we plan to roll out the first made-in-India Pixel phone by 2024. In the case of smartphones, we believe India provides a very interesting opportunity. Today, a lot of work that we do in designing our hardware, a lot of thinking, and engineering talent for UI [user interface], UX [user experience], etc is set up here.

What kind of market do you see in India for Chromebooks? Are you shifting capacity from China?
 

I think this is more of building capacity for India rather than shifting capacity to India. The challenge for Chromebooks or any such device is that pricing is still not conducive for every Indian. Android helped reduce smartphone prices deeply. Other notebooks are much more expensive, but we sell a Chromebook at Rs 20,000- 25,000, depending on which OEM (original equipment manufacturer) you are working with.

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But I am not sure if we have found the right value equation for the market, which helps bring that deep acceleration. I think that's something that we will learn with HP Chromebook as the manufacturer here. We will learn so many more things on how we bring cost advantages when you manufacture in India, so there is some distance to go. But it is only for India.

What is the reality on the ground with respect to the Competition Commission of India’s directives to unbundle your Android services?
 

So there were a lot of remedies that you suggested for us. We have acted on all the remedies suggested to us in fullness and completely. It is still a case which is sub judice; it is in the Supreme Court. The National Company Law Appellate Tribunal (NCLAT) had set aside some remedies because they could be harmful to consumers. But in my mind, we have done everything that was expected of us. So I don’t think we are “bundled”.

Google had announced its India Digitization Fund worth $10 billion. How much of this has been already invested and what is the way forward?

When we announced the fund in 2020, Sundar (Google CEO Sundar Pichai) had said it was for the next five to seven years. We have invested a large chunk of that money in the last few years, but there is still some mileage to go. We are still spending that money on strategic opportunities that we have found in the last few years, though not as big a ticket in size as we did in the beginning. We made a lot of big-ticket investments then with investments in Reliance Jio and Bharti Airtel.

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As we exhaust the $10 billion ambit, there should be a good moment in the next two or three years to answer your question (on the next phase of investment).

How do you look at the demand by telecom operators for revenue share of OTT apps and the debate on the transition period for complying with the Digital Personal Data Protection Act?
 

One thing that we have been committed to is, as the laws of the land come, we comply with them as per the requirements of the regulators. The simple principle is if it is good for the consumer, it is good for the business. We take pride in following that.

On the telecom debate, I think it is more of a commercial matter than any other point of view. This is purely a commercial arrangement. As a consumer, I would say - I pay for data, and that goes to telco and I pay for content, which goes to the platforms and both earn their money.

You have tried to look at a subscription model for YouTube in India. How has been the response?
 

India is still learning to pay money for subscriptions. We are happy with where we have reached. But the market is much bigger. As a country, we are still shy or reticent in paying subscription money. But this is changing. I see so many other businesses now moving to subscriptions. The market is ready for much larger in the next three to five years, as incomes increase.

What is the progress on Google’s fintech centre in GIFT City so far?
 

That will be operational in the first quarter of 2024.

How do you see the advertising market shift? How do you see your ability to monetise the fact that digital is increasingly amounting to a larger pie?
 

The (Indian) ad market is now 0.4 per cent of the GDP, much lower than in any other part of the world. This creates a challenge that advertising has remained limited to a few large and medium-sized players. It has not percolated to SMEs. The access to capital and access to capacity has been very limited for SMEs. This access will change very dramatically (in coming years).

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Advertising is reasonably more digital today, than it was maybe five years ago. All aggregators – it could be marketplaces – which are doing commerce, people who are doing food delivery, or any kind of application, or even telecom companies have moved into digital advertising in a very big way. And a large chunk of money is now going to those people. That's good for the industry. The big shift I see is that three to five years back, there were very few player players and a lot of new categories and businesses are now using advertising as a way to grow their presence.

How is Google leveraging the rise of generative Artificial Intelligence (AI) in India?
 

Google has played an important role as a catalyst for digital transformation in India. Three or four things have played a very important role. It has been a great journey. At this moment, we believe in generative AI, and we have an important moment to take the next leap in India. In this Google for India, we are thinking about how we can use this moment.

We are committed to use the power of generative AI, especially in the area of language, and enable our services to be more easily accessible in every language. It could be citizen services, it could be Search, or any of our products. We are also using cloud technology to power our partners with the same opportunity of language and many other capabilities that the Cloud enables us to use.