We bring to you the latest edition of News Roundup: Indian Startup Stories Of The Week!
In one of the most important developments this week for the Indian startup ecosystem, global streaming giant Spotify finally marked its entry in India, even though the plans hit a snag when Warner Music Group (WMG) filed an injunction against Spotify in an Indian court after licensing negotiations fell apart.
Spotify began its Indian operations on February 27 with paid plans starting from INR 119 per month, after one month-free service.
Here’s a look at the other important developments for the week.
Important Indian Startup News Stories Of The Week
Draft Ecommerce Policy And The Reactions
- The government opened draft ecommerce policy for views from stakeholders on February 23, which proposed regulation of cross border data flows and enabling sharing of anonymised community data. The policy is focusing on six broad issues in the ecommerce sector — data, infrastructure development, ecommerce marketplaces, regulatory issues, stimulating domestic digital economy, and export promotion through ecommerce.
- The ecommerce policy draft has suggested setting up of a body of industry stakeholders who will be responsible for identifying websites which show pirated content. The government will then take steps to limit their advertising and subscription revenue.
- China-based ecommerce giant Alibaba has welcomed the Indian draft ecommerce policy adding that the company continues to consider the country as its “strategic market” for its globalisation vision.
The Buzz Of $200 Bn-Worth Ecommerce
- Deloitte India and Retailers Association of India (RAI) report predicted ecommerce sector to grow to $1.2 Tn by 2021. It has cited increased internet penetration and foray of more international retailers to India as the main reasons for the expected growth. As a result of which, the share of organized retail market is also expected to increase from around 12% in 2017 to 22-25% by 2021.
- Mukesh Ambani’s plan to capture the ecommerce market by converging its two consumer business units —Reliance Jio Infocomm Ltd and Reliance Retail Ltd — under Reliance Industries Ltd (RIL), may not happen due to current data privacy laws. “Any data sharing on customers between the two could run into a legal wall,” the company’s senior executive has revealed.
- UK and Gurugram-based consumer goods company Reckitt Benckiser (RB) has reportedly begun its own direct-to-consumer ecommerce operation to sell some of its premium products in India. It plans to offer the products through the brand specific websites similar to hybrid models followed by rival FMCG players Mondelez and ITC.
General Elections 2019: The Parliament And Social Media
- The central government has asked social media companies to ensure that their platforms are not being misused to spread content against India. MeitY had asked YouTube to remove 11 specific video links saying that it has the potential to incite public order and peace in the country. The ministry also directed Google to ensure that similar videos are taken down and also share a compliance report.
- Facebook along with its subsidiaries, Instagram and WhatsApp, has been summoned on March 6 as the government seeks to check the spread of misinformation and fake news on their platforms ahead of the general elections. It said it is now ready to answer to India’s Parliamentary Standing Committee on Information Technology in a hearing to be held in March.
- Twitter has reportedly given 10 days to respond to parliamentary panel questions in writing. These questions include, Twitter’s registration status in India, whether the company is registered as a technology or media company, and number of employees in Twitter India office.
Startup Lobby And IPO: Voting Rights And Private IPO Filing
- IndiaTech has submitted a proposal to Ministry of Corporate Affairs (MCA), and Securities and Exchange Board of India (SEBI) asking for dual-class share structure and differential voting rights for startup founders and promoters.
- It has also urged market regulator SEBI to allow the startups to file confidential initial public offering (IPO) papers and that these documents be made public only after a month of filing the draft documents.
OYO Hospitality Gets Food And Life
- OYO has opened over 20 cloud kitchens in Gurugram and Bengaluru operating on Zomato and Swiggy. Upon checking these food delivery apps, cloud kitchens such as Adraq by OYO and O’Biriyani by OYO showed to be operational and serving food. OYO Food app, available on Google Play Store and works as an intermediary for food and beverages vendors who want to deliver to the associated hotels of OYO.
- OYO has rebranded its long-term fully managed housing rental solution OYO Living to OYO LIFE, which provides upgraded living experiences at affordable prices to young professionals globally.
Flipkart: 50% Growth In Revenue And More
- Flipkart Group reported a 50% growth in its revenue for the year ending March 2018. The major expense which increased the losses for the year ending March 2018 was finance costs, mostly under “fair value loss on derivative financial instruments”, which increased nearly tenfold to INR 40,937Cr in FY18 from INR 4,309 Cr in FY17.
- Major Flipkart sellers such as SuperComNet, OmniTech Retail and RetailNet have reportedly planned to cut direct purchases from Flipkart India (wholesale arm of Flipkart) to around 10% or less in the next few months. Sellers have reportedly restricted their purchases from Flipkart wholesale to about 25% and are now buying the bulk of their products from consumer goods companies instead of manufacturers.
- US-based corporate finance consulting firm, Wolet Capital Corporation (WCC), has reportedly sued Flipkart and parent company Walmart, alleging that the ecommerce major has failed to pay for its advisory services for the acquisition of Israel-based Upstream Commerce last year.
RBI Extends KYC Deadline By Six Months
The central bank had mandated the prepaid payment instrument (PPI) providers and online wallet companies to complete their KYC process by February 28, 2019. In order to relieve the players, the RBI has now extended the deadline. “Based on requests received from various stakeholders to increase the above timeline on account of difficulties in undertaking Aadhaar e-KYC and time necessary to put in place alternative systems for completing the KYC process, it has been decided to allow PPI issuers additional time of six months for completion of the KYC,” the notification said.
CBDT To Be The Angel For Startups With Angel Tax Notices
The CBDT had asked LocalCircles to share the details of the startups who have received the demand orders. These details include PAN, the name of the company and section under which they have received the order. The agency will issue the details to its assessing officers explaining the mechanism for providing the exemption to startups from angel tax, under Section 56 of the Income Tax Act.
Safe Online Experience For Women?
A parliamentary committee called Empowerment of Women, has written to the government seeking safer online experience for women. The committee had raised the issues faced by women on social media during their meeting with senior officials of the Ministry of Electronics and Information Technology. The committee had asked MeitY to give an update on what the ministry has been doing for the safety of women in social media sites and what are the mechanisms available to control trolls and abuse of women users.
Zomato: Hyperpure, Fake Reviews And More
- Zomato’s in-house company Hyperpure moved from a 6K sq ft warehouse in Bengaluru to a 30K sq ft space this week in order to service over 2,500 restaurants every day. According to the company, within three months of the launch of Hyperpure, the service grew immensely with about 350 restaurants purchasing from Hyperpure in Bengaluru. Currently, about 1,000 restaurants use Hyperpure services.
- Zomato, which was reportedly served a notice from Dehradun’s food safety office, has said the online food delivery platform has already applied for the food safety licence to operate in the city.
- Zomato has removed more than 300 high activity users from the platform on the grounds of ‘solicitation’ (where influential foodies are incentivised or offer to join hands — in some cases for monetary gains — to write about restaurants) as the company gathered sufficient evidence to prove their involvement in these unethical, and sometimes even illegal practices.
Hughes Gets In-Flight WiFi License In India
Hughes Communications India Ltd (HCIL), a majority-owned subsidiary of global broadband satellite technology and service company Hughes Network Systems, LLC (HUGHES), will now be allowed to offer in-flight connectivity and high-quality broadband services to Indian and foreign airlines and shipping companies operating within Indian territory.
Other Indian Startup News Stories Of The Week
National Policy on Software Products 2019
The government approved the policy on February 28 with an outlay of INR 5,000 Cr fund, aimed at nurturing 10K startups in the software product industry and generate 3.5 Mn employment by 2025. It aims to make India a $70 -80 Bn software products industry by 2025.
Walmart India And PhonePe Tie-up
The digital payments app PhonePe has entered into a partnership with Walmart India to enable its more than 1 Mn best price members, mainly kiranas, to draw funds from their a bank account using the UPI payment option. The current partnership, however, will only benefit shop owners registered with Walmart India’s best price stores.
Zero Balance Current Accounts By Paytm Payments Bank
Paytm Payments Banks has launched a zero balance current account with features such as unlimited free digital transactions and free debit card etc. This new feature targets individuals, sole business owners and other small businesses who could not meet the minimum required balance of current accounts offered by traditional banks.
India-Korea Hub: A New Global Partnership
This startup hub will serve as a one-stop platform to bring Indian and Korean startup ecosystems closer and to facilitate joint innovation between the two economies. The Startup Hub will enable collaborations between startups, investors, incubators, and aspiring entrepreneurs of both countries and provide them with resources for market entry and global expansion.
Chinese Gadget Makers Are The Next Focus For Govt
The Department of Telecom (DoT) has said that the central government will carefully study the issues related to Chinese telecom gear makers after various countries have alleged that the Chinese have been looking to use their telecom equipment to breach global security.
Winners Of E-Governance Awards 2019
The National e-Governance Award recognises some of the best Government to Government (G2G), Government to Citizen (G2C), Government to Business (G2B) initiatives taken by government departments. At the e-governance awards 2019, the 14 Awards were given in six categories to recognise achievements, with Gold and Silver Awards in each category. The winners include IRCTC rail connect app, UMANG, iSTART among others.
OTT Discussions By TRAI
India’s telecom regulator TRAI is working on the draft regulatory framework for over-the-top (OTT) services operating in India, which is expected to be released in a couple of months. “We already have a paper on OTT. We will come out with appropriate recommendations and regulations in near future. A couple of months from now,” said TRAI chairman RS Sharma.
Kerala-Based Verteil Technologies Expands To Japan
Verteil Technologies, a startup supported by Kerala Startup Mission (KSUM), has expanded to Japan to launch its New Distribution Capability (NDC) platform, Verteil Direct Connect (VDC) in the Japan market. The company’s goal is to unlock the full value of NDC and make it available to the indirect airline sales channels in Japan.
True Balance Extends UPI Payments
True Balance has tied-up with PayU to connect customers and merchants by enabling seamless payments through UPI. True Balance is also expanding its service portfolio in the ecommerce segment, and will enable customers to have benefits of EMI on recharge loans, purchase of mobile handsets, etc.
Stay tuned for the next week edition of Indian Startup News Stories Of The Week!