Amazon’s empire is under threat from India’s attempt to “democratize” virtual commerce

India is trying to keep The monopoly power of some companies in the e-commerce industry like Amazon has been brought to an endWith an open network that welcomes buyers, sellers and distributors without third-party interests, instead of the traditional vision of a website managed by an intermediary.

Penetration of e-commerce in India is low from the point of view of its promoters, where they count 90 million people are regular usersA fact that does not do justice to the second most populous country in the world with a population of over 1,350 million.

The people responsible for the Open Network for Digital Commerce (ONDC) project say the only way to increase this number is to do something different from what the big companies are doing. It will democratize the sector by facilitating the transition to virtual commerce for small businesses. It will provide the same visibility as larger businesses.

E-commerce in India is expected to reach $74.5 billion in revenue by the end of this year and grow to $350,000 million by 2030, according to estimates by India Equity Trust under the Ministry of Commerce.

Digital Feudalism

CURRENT INSTITUTIONS “They are feudal lords with an incentive to show the buyer what they want and not what the buyer wants.”Executive Director of the ONDC project, which began its pilot phase in five Indian cities in mid-April, said D. Koshy told Efe.

ONDC, on the other hand, is indirectly controlled by the Government of India and is a non-profit that “doesn’t have to be loyal to anyone, so it helps you make informed choices by asking intelligent questions rather than trying to influence you.” He insisted.

Although the initiative is taking its first steps, one of a kind Beta phase to learn from mistakes that can be made, It aims to gradually expand its action radar until it is in a hundred Indian cities by August.

The main difference between this network and giants of e-commerce like Amazon or Flipkart is that ONDC does not have its own interface, thus escaping “web-centrism” as Koshy calls it, so search for what you want to access it. Product on any platform that creates it.

Additionally, when consumers perform a search on the application or website of one of ONDC’s participants, they will be shown not only the products of said business, but also the products of others that are part of it.

Without A pre-established order, which depends on the filters the consumer chooses, A large company’s services will appear on par with those offered by a small business, offering the same opportunities for both to be selected.

“Earlier, the middleman was a source of power because with all the information he could say to the seller, ‘If you give me a little extra money, I can give you a raise.’ That’s the fundamental change,” warned Khoshi.

A turn of the tables as they intend to end the opacity that characterizes the giants of e-commerce, and according to ONDC’s vice-president of strategic plans, Rahul Handa, 250 million people contribute to tripling the number of consumers E-commerce in India.

“The reason ONDC exists is to democratize trade,” he said.

Currently, The network includes seven companies covering different sectors such as food, health or agriculture. Among other things, and the idea is, it offers a variety of products, including the sale of flight or train tickets.

Amazon is interested

Despite positioning itself as an alternative to Amazon or Flipkart, ONDC’s promoters refrain from naming these platforms as competition, instead saying that Amazon has already shown interest in the project with a view to a potential merger.

“We are in conversation with them (…), which will be good news for us and for them. Because they have access to a very large network, and For us, the addition of an important brand adds to ONDC’s credibility.”Shireesh Joshi, commercial director of the network, explained to Efe.

However, the Indian government doubts whether this interest from the e-commerce giant is real and hopes that the growth of this venture, which indirectly controls 50%, will start shifting Amazon customers to its network in the near future.

“The seller wants to get as many customers as they can. Now, if they’re on Amazon, they’re only getting customers on Amazon. If you are in ONDC, you will get customers from all regions,” Anil Aggarwal, Additional Secretary of the Indian Ministry of Commerce, explained to Efe.

Project Manager, Aggarwal emphasized the non-profit nature of ONDCIn it he points out that after an initial investment of $1.3 million, he has already raised enough money to sustain himself for the next few years.

This allows them to charge, he continued “A very small fee for every transaction that occurs on the network”, But it won’t be launched until negotiations with network members have progressed through the testing phase.

“We are taking special measures to build trust in the system. (…) If there is no trust, no one will come here,” Agarwal concluded.