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IMPACT OF GOOGLE WORKSPACE REBRANDING Indian MSMEs react to hikes in Google Workspace charges

Sep 30, 2022

Google has recently hiked its service fee for Google Workspace (formerly known as Google Suite). This means that the Indian MSEMs must pay extra of the original service fee to avail the facility. We spoke to some key players in the industry to understand how this rebranding is affecting their company’s productivity and what impact it has on the overall development of the industry. - Neha Basudkar Ghate, Sub Editor, em.india@publish-industry.in

MSMEs form the backbone of the Indian economy. After having suffered significantly during the pandemic that led to losses in the GDP contribution from the MSME sector, today, the sector is again witnessing a bright ray of hope. The Indian Government, with its ‘Make in India’ policy along with other such crucial polices, has been supporting this sector, therefore, creating new job opportunities for the new MSME companies and their new product development.

However, things suddenly took a toll with the recent service fee hike from Google. One of the companies directly addressed Google India’s senior management with an open letter about the additional investments that companies will have to make every year to avail the services. The entrepreneur had also tagged the respective Indian ministries to notify the issue and resolve it.

What does Google state?

According to this policy change, Indian MSMEs will be forced to pay an additional ₹1500 cr to ₹5000 cr yearly. As Google announced its rebranding from G-Suite to Google Workspace with specific policy changes, now it states that an additional 100 GB of storage is no longer available as they need to fit into the ‘Business Standard’ category, which has a minimum storage of 2 TB and costs ₹10,100 per year per user. Google further stated that if a business needs more than 30 GB storage in a single account, they must upgrade all the accounts to 2 TB storage, which led them to pay a 400% higher price. Additionally, Google has raised the exit barrier, which has made it more difficult for businesses to transfer their data to a different service provider. Team EM spoke to entrepreneurs from MSME sector, Google India and respective Indian Ministries over this topic and has noted their reactions.

Ok Google, it's not OK - Vishal Prakash Shah, CEO, Synersoft Technologies

An open letter to Google by Vishal Shah, CEO, Synersoft Technologies, has recently sent an open letter to Google’s Apex Executives – Sanjay Gupta, Amit Kumar, Mayoori Kango and the product team of Google India. This letter is also addressed to the Competition Commission of India, Ministry of MSMEs, IT & Broadcasting, Science & Technology, Industry & Commerce and Finance. In his open letter, Shah suggests that Google rationalise its policies by lowering the exit barrier or selling something that customers require. “Introduce additional storage space options in the Business Starter category. It is unfair to charge customers for what they will not use. Or revoke the policy forcing upgrades for all users in case one user needs more storage. It is a coercive practise to force the customers to upgrade for all users when the upgrade requirement is only for one user. If you don’t want to do the above, cooperate with your customers who want to migrate. It is monopolistic to keep a high exit barrier.”

Setback for the industry - Manoj Pillai, Head – Projects and IT, ITEM Secure

The free access to email and associated services like shared spreadsheets (Google sheets) and other office automation products was a real boon to the MSME sector. While Google stopped offering free services to organisations around eight years back, organisations using G-suite at that time could continue with free access for up to 50 users with custom email ids and all associated office productivity tools. All this turned upside down with Google withdrawing free access to organisations. Now, an organisation needs to pay for every single user. While this is not a constraint for large corporates, it’s challenging for the MSMEs. Many MSMEs function shared resources for HR and other crucial activities. For them, paying around ₹125/user/month (renews at around ₹250 from the second year) for email and related facilities will be a huge setback, especially when the whole industry and, especially MSME, are reeling under the aftereffects of COVID-19, topped up with the spiralling costs owing to the Europe crisis. The Indian MSMEs are now facing a huge challenge to meet their needs for online collaboration. While many options for emails are available, it might not be easy to find cost-effective solutions for online shared sheets and other documents. Even if an organisation finds an alternative, training users on the new platform and reaching previous levels of efficiency levels will remain a time-consuming activity.

A monopolistic practise - Hemang Gandhi, Founder & CEO, Rioconn Interactive

Google has always been supportive over these years. Initially with the legacy edition, which transformed the entire landscape of email communication to Google Chrome, Google Drive, and other useful tools. However, lately, they have been invading their own principles, set by their very own founders. A recent example is the rebranding of Google Workspace.

Google's workspace (earlier Suite) became popular because of its MSME/SME-friendly features. Suddenly, they are anti-MSME/SME, and they just want to make money out of such a small requirement. Over the years, because of G-Suite’s popularity, most of the MSME/SME ecosystem has been using their services. At this point, it's quite difficult to switch over, and even in a switch over, they have kept several checkpoints that practically make it difficult to switch over data from the last 10 – 15 years. This is a monopolistic practise, by Google to fetch heavy earnings from the MSME/SME industry. Today, we are not sure how to deal with this scenario, and so we have kept the space-related issues on hold till further clarification. This is ultimately hampering our overall productivity.

An unfair practise - Hemin Patel, Director, Centurion Laboratories, Centurion Remedies

We have been using Google Mail for more than ten years now. Since then, we have been using its email service for all our employees and after its service allocation, we received 15 GB of free data. However, we would have to pay extra charges if we exceeded that limit.

Now suddenly Google has changed its policy from G-Suite to Google Workspace, which I feel is a huge breakdown for us, as we do not have any option but to pay this hefty amount as per the Google revised policies. I want to raise a question here,that what is the need for this sudden policy change and why is it been required to increase prices, these hiked up prices are not easy for us to pay. Secondly, why is this migration becoming a mandate to keep the services active? I might not require such huge data to function; still, I must pay for its continuation.

This reflects unprofessionalism - Nilay Seth, Founder, Nivida Web Solutions

We have been doing business in the MSME sector for the last 15 years. Initially, we encouraged our customers and clients to take G-Suite because it was free for lifetime. Now suddenly, they are making it commercial, this is highly unprofessional. Since we have been using this service for a long time now, our data has been stored with Google, and now after commercialising this software, we end up paying heavily to not lose our data.

Google is everywhere with its cookie policy today. It can have a backup of the data and tomorrow they might charge us even for browsing or watching a video. This must stop with immediate effect as we, the MSME industry, are dependent on this data.

Mixed and match approach - Jay Mehta, Global Partnership & Alliance Manager, Floatbot, Inc

Users are always comfortable running in a format that has been active for a longer period. A sudden change brings resistance. When it comes to privacy policies, it always has mixed reactions.

If we look from the users’ perspective, the policies are good. We used to have free subscriptions earlier, but now to have a service fee is not widely accepted in the Indian industry. So, it’s time we accept it considering that it is coming with well-researched time and efforts spent behind it.

Looking for Government’s support - Dr Varoon Singh, Senior Scientist, University of Vienna

MSMEs have a diverse turnover range. When an industry (micro) invests 20% of its budget in keeping software tools functioning, its budget and profits are severely damaged. The government has taken serious steps to digitalise and streamline the processes by bringing MSME up to industry standards and partnering with offshore service providers.

However, this has created a monopoly for some businesses and is unfavourable to MSMEs due to current changes in their business practises. It is unfair to force customers to choose services they don't need and do not offer segmented solutions. The Google policy should changed since it directly exploits its monopoly and is not in the interests of MSME businesses. They are safeguarding their interests at the expense of business profits by capping downloads during migration.

Although MSMEs are switching to other providers, situations like this are bound to occur in the future. As a solution, the government can provide cloud services for Indian industries (huge potential for indigenisation), saving foreign exchange, safeguarding business data, and enhancing foreign control. An instant solution for MSMEs to the current problem can be setting up a small server (100 TB) and an email programme that connects to the company’s website. Investing in this technology might be a one-time cost, but it can save businesses a lot in the long run and provide liberty.

Industry expert - An industry expert with name held on request

With name held under the condition of anonymity, stated, “IT giants or service providers have grown out of proportion and dictate policies at will. We cannot contest with them on such issues individually or collectively unless there is Government / Ministry of MSME intervention. There are several MSME bodies/associations in India, they should come together and make a joint representation to the IT Ministry & Minister for MSME with the facts of the case, which has been extensively highlighted by Vishal Shah. The representation should guide the Government in making a policy decision to avert such unilateral enforcements in the future by any other service provider which will harm MSMEs industry. To sum up, unless the Government at the highest level does not intervene in this case, it will not be resolved.

A unilateral bad practise - Vinod Kumar, Honorary President, India SME Forum

Around 6.5 lakh MSME entrepreneurs in India have been affected by this huge policy change, and Google, on the other hand, will be benefitting with about ₹4 to 5 lakh corers. Everyone having a 2 TB account is not feasible. This is a unilateral bad practice. Earlier, Google offered and supported the government’s data storage for free. Until recently, this big giant has informed the government to upgrade to paid storage. As a result, around 200 to 300 lakh people working in the government sector will be affected. We cannot allow such practices to be continued in India, no other country allows this practise. Therefore, the government must intervene. We understand the concern of the MSME industry, and we will be writing to the Ministry of Information and Technology. Such a practise is not accepted.

We tried to establish communication with Google India & respective Indian Ministries, to take their view into consideration and showcase all the sides of the story. However, neither Google India nor the respective Indian Ministries responded over this situation till the time we went to press.

MSME Insights

  • MSMEs’ share of the GDP had earlier increased from 29.25% in FY17 to 29.69% in FY18

  • The share of the formal MSME sector in the GDP is up to 40% in emerging economies

  • With the presence of over 63 million MSMEs employing over 110 million people spread across services, the manufacturing sector contributes nearly 30% to the GDP

  • Maharashtra has about 48 lakh MSME's accounting for about 8% of the total MSMEs in the country

  • The ambitious target of $5 trillion economy with a 25% contribution from the manufacturing sector will require the MSME sector to play a pivotal role

  • According to the reports, the share of the 6.3 crore strong micro, small and medium enterprise (MSME) sector in the country’s GDP dropped from 30.50% during the financial year 2018-19 and FY20 to 26.83% during the first year of the COVID pandemic 2020-21, official data showed

Image Gallery

  • Vishal Prakash Shah

    CEO

    Synersoft Technologies

  • Manoj Pillai

    Head – Projects and IT

    ITEM Secure

  • Hemang Gandhi

    Founder & CEO

    Rioconn Interactive

  • Hemin Patel

    Director

    Centurion Laboratories

    Centurion Remedies

  • Nilay Seth

    Founder

    Nivida Web Solutions

  • Jay Mehta

    Global Partnership & Alliance Manager

    Floatbot, Inc

  • Dr Varoon Singh

    Senior Scientist

    University of Vienna

  • Vinod Kumar

    Honorary President

    India SME Forum

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