Xiaomi and Samsung accused of collusion with Amazon and Flipkart

• Smartphone manufacturers and e-commerce players have come under scrutiny by the CCI.
• Smartphone manufacturers accused of collusion Amazon AND Flipkart.
• Exclusive premieres and giving big discounts are some of the practices investigated.

This Competition Commission of India (CCI), the country’s antitrust watchdog, has reportedly accused smartphone manufacturers such as Xiaomi AND SAMSUNG about collusion with entities operating in the e-commerce market: Amazon and Flipkart.

According to a report by Reuters, smartphone makers have been accused of colluding with e-commerce players to exclusively market products on their platforms.

Smartphone manufacturers have also been accused of violating competition law by favoring selected sellers, prioritizing offers, giving deep discounts on products, and more.

CCI files report on Amazon and Flipkart

The CCI has filed a 1,027-page report on Amazon, accusing Samsung, Xiaomi, OnePlus, Motorola and Realme of “engaging in exclusive phone launches” and “colluding” with Amazon, which is a violation of competition law, sources said.

Similarly, the watchdog had submitted a 1,696-page report on Flipkart in which it accused Samsung, Xiaomi, Lenovo, Motorola, and Vivo of “collusion”.

“Exclusivity in business is a curse,” said CCI Additional Director General GV Siva Prasad, according to the report. “It is not only against free and fair competition but also against the interests of consumers,” Prasad added.

While e-commerce giants Amazon and Flipkart have reportedly downplayed the practice of launching ‘exclusive’ smartphones, an investigation has found that the practice is ‘widely prevalent’.

The Indian e-commerce market is expected to grow from $57 billion in 2023 to over $160 billion by 2028. Smartphone maker Vivo currently has a 19% market share in smartphone shipments, followed by Samsung and Xiaomi with a combined market share of over 35%.

According to the latest report from International Data Corporation, deliveries via online channels grew 8% year-over-year and reached 50% in the second quarter of 2024, compared to 47% in the second quarter of 2023.

According to the report, exclusive launches have driven customers towards these online platforms and hurt small retailers. The investigation stems from a complaint filed by the Confederation of All India Traders (CAIT) in 2020.

The organization, which has more than 80 million members, accused smartphone makers and e-commerce players of disadvantaging brick-and-mortar retailers and favoring online-only product launches.

In the coming weeks, we should learn more about the investigation and its impact on smartphone makers, e-commerce players, and the future of exclusive launches.

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