Samsung, Xiaomi and other makers found guilty of colluding with Amazon and Flipkart

Samsung, Xiaomi, and other major smartphone companies are guilty of breaching antitrust laws, according to regulatory reports. Reuters revealed that the Competition Commission of India (CCI) found that Amazon and Flipkart violated local competition laws by giving preference to select makers, hurting other companies.

The CCI posted a 1,027-page report on Amazon, colluding with Samsung, Xiaomi, Motorola, Realme, and OnePlus. All these companies had "exclusive phone launches," breaking competition law. Similar is the case with Flipkart, where a 1,696-page report said Samsung, Xiaomi, Motorola, vivo, Lenovo and Realme conducted similar practices.

CCI's additional director general, G.V. Siva Prasad, wrote that exclusivity in business is "anathema" and against fair competition and the interests of consumers.

The major issue with these "exclusive launches" is that retailers offered the big players preference, prioritization of certain listings, and steep discounts, all of which hurt other retailers. Both Amazon and Flipkart deliberately downplayed allegations of exclusive launches, but officials found the practice "rampant."

Recent data revealed that Samsung and Xiaomi hold over a third of the smartphone market. The CCI pointed out that big companies relied on foreign investments to keep prices low and subsidized rates for services like warehousing and marketing to a select number of sellers.

vivo sells the same phone under different names on different websites - iQOO Z9 Lite on Amazon, T3 Lite on Flipkart

Reuters also quoted internal CCI documents from last month, in which the Commission ordered some smartphone companies to submit their financial statements for three fiscal years to 2024. The investigation into Amazon, Flipkart, and their sellers started in 2020 after a complaint from an affiliate of the country's biggest retailer association, the Confederation of All India Traders, which has 80 million members.

The next step in the process is for CCI to review any objections. It could potentially be followed by fines being imposed and companies being mandated to change their business practices.

Smaller Indian retailers repeatedly accused Amazon and Flipkart of launching exclusive phone models online, hurting offline shopkeepers who don't get the latest models and pushing customers to look for them online. According to research data, 50% of all phone sales in India were online, up from 14.5% in 2013.

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