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Microsoft joins India's monopoly-busting e-commerce multi-mart
The Open Network for Digital Commerce could hardly ask for a more credible participant
Microsoft has decided to open a store in India's Open Network for Digital Commerce (ONDC) – an effort the nation hopes will make it harder for the likes of Amazon and Walmart-controlled Flipkart to dominate e-commerce in the world's second most populous nation.
Launched in July 2021, the ONDC plans to create open technologies for vendors to create an e-commerce presence that's discoverable through many third-party digital shopfronts. Buyers would be able to shop from the e-commerce provider they prefer, but see offers from rivals on that provider's site instead of having to surf to find other deals.
The not-for-profit entity is backed by the government as a means to make e-commerce easier for small retailers, improve competition for consumers, and provide an alternative to the likes of Amazon.com and Flipkart. Indian policymakers acknowledge the utility provided by big tech, but also fear its dominance leaving the nation beholden to foreign companies that have their own bottom lines, rather than India's wellbeing, as their main motivator.
Microsoft's decision to join ONDC will see it create a shopping app. A company spokesperson described the company's participation as "a win-win for both buyers and sellers as it will enable them to connect without dependency on any e-commerce solution."
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Having a company of Microsoft's size and fame join ONDC is undoubtedly a boost for the project and lends it considerable credibility as its backers seek to create momentum and demand. It's also a little ironic that a giant tech company's involvement in a project that aims to reduce the influence of big tech is a win for ONDC.
Microsoft won around $1.2 billion of revenue in India during FY20/21. Exposure to India's enormous population through ONDC may not boost that figure markedly, as few Microsoft products target Indian consumers and mobile devices running Android dominate the local market.
But Microsoft will reduce its dependency on big e-commerce platforms. That ONDC will also charge vastly lower commissions than its commercial rivals will also mean that Microsoft enjoys higher margins on any sales it scores through the network. ®