‘Swiggy-Zomato तोड़ रहे ग्राहकों का भरोसा’नई सरकारी रिपोर्ट ने किया Expose!! |इशारों इशारों में

Summary

Zomato and Swiggy are under investigation by the Competition Commission of India (CCI) for anti-competitive practices. The platforms are accused of using exclusive contracts with restaurants, limiting visibility for non-partnered eateries and manipulating search results. These tactics have led to complaints from the National Restaurant Association of India (NRAI), alleging unfair market practices. The investigation also highlights how these companies’ market power could be harming smaller businesses and manipulating consumer choices. The case raises concerns over the influence of large tech companies in shaping market dynamics and consumer behavior.

Takeaways

• 😀 Zomato and Swiggy are under investigation by the Competition Commission of India (CCI) for anti-competitive practices.
• 😀 The investigation focuses on exclusive contracts between Zomato/Swiggy and restaurants that give unfair advantages to some restaurants.
• 😀 These exclusive agreements offer benefits like lower commission fees, better visibility, and promises of sustained growth.
• 😀 CCI is concerned that such practices hinder fair competition and disadvantage restaurants not involved in exclusive partnerships.
• 😀 The platforms use technology to manipulate search results, making certain restaurants more visible to consumers.
• 😀 The National Restaurant Association of India (NRAI) filed complaints with CCI, raising concerns about unfair treatment and market manipulation.
• 😀 Zomato and Swiggy’s business practices are considered unfair, as they manipulate customer preferences and restaurant visibility.
• 😀 Both platforms have rapidly grown in recent years, with Swiggy recently launching an IPO worth ₹11,327 crore.
• 😀 Swiggy’s IPO included an internal risk factor regarding the CCI investigation, acknowledging that their practices might be questioned.
• 😀 Zomato’s IPO in 2021 raised concerns over their market behavior, with a valuation of ₹2.2 lakh crore as of the latest Friday.
• 😀 NRAI urges the government to intervene and regulate the anti-competitive practices of Zomato and Swiggy to ensure fair play.

Q & A

What is the main issue raised in the investigation of Zomato and Swiggy by the Competition Commission of India (CCI)?

The main issue is that Zomato and Swiggy are reportedly using exclusive agreements with restaurants, offering them lower commissions and better visibility in exchange for being exclusive to their platforms. This creates an unfair advantage for certain restaurants and harms competition in the market.

What kind of exclusive benefits do Zomato and Swiggy offer to restaurants under these agreements?

Zomato and Swiggy offer benefits such as lower commission fees, better visibility on the platform, and promises of sustained growth in exchange for exclusive partnerships with restaurants.

Why does the Competition Commission of India (CCI) view these exclusive agreements as problematic?

CCI views these exclusive agreements as problematic because they create an uneven playing field. Restaurants not participating in these exclusives may face disadvantages, such as lower visibility on the platforms, leading to fewer customers and reduced business opportunities.

What specific impact do these exclusive contracts have on non-participating restaurants?

Non-participating restaurants are at a disadvantage because they miss out on the benefits offered to exclusive partners, such as increased visibility and lower commission fees, which affects their ability to compete effectively on the platforms.

What is the role of the National Restaurant Association of India (NRAI) in this issue?

The NRAI filed complaints with the CCI, highlighting how the practices of Zomato and Swiggy, including exclusive partnerships, were harming restaurants by reducing their visibility and limiting their choices for food delivery platforms.

How do Zomato and Swiggy manipulate search results to favor certain restaurants?

Zomato and Swiggy use software algorithms to ensure that exclusive partner restaurants appear more frequently in search results, thus improving their visibility to consumers, even when other restaurants may offer similar or better options.

What was the outcome of the CCI's investigation into these practices?

The CCI found that Zomato and Swiggy's practices were indeed creating a competitive disadvantage and harming fair market practices. The investigation pointed out that these practices were not fostering competition and were instead giving unfair advantages to certain restaurants.

How have Zomato and Swiggy reacted to the concerns raised by the CCI?

Zomato and Swiggy have acknowledged the potential risks highlighted by the CCI, particularly concerning exclusive contracts. Swiggy, for instance, mentioned the risk of such concerns during its IPO filing, indicating that the investigation could impact their business.

What do Zomato and Swiggy's IPO filings reveal about their business strategy?

Zomato's IPO, launched in 2021, and Swiggy's IPO, launched in 2024, reveal that both companies are growing rapidly, partly due to their exclusive agreements with restaurants. However, they also acknowledge the risks associated with these practices, including scrutiny from regulatory bodies like the CCI.

What is the recommendation from the NRAI regarding the actions of Zomato and Swiggy?

The NRAI has urged the government to take the issue seriously and intervene to prevent Zomato and Swiggy from continuing their unfair practices, which they believe are monopolizing the market and reducing competition.