By Abhiruchi Ranjan
This week marked the end of a 13-year-old lawsuit as Visa and MasterCard, along with top US banks agreed to pay $6.2 billion for violating antitrust laws. Here are some business stories you may have missed last week.
EU threatens Facebook with sanctions if it fails to clarify terms and conditions
It hasn’t been a good year for Facebook. After battling the Cambridge Analytica scandal and being at loggerheads with multiple regulators regarding online hate speech, the tech company has been facing heat from the EU commissioner in charge of consumer protection, Vera Jourova.
Having been in dialogue for over two years, the regulator is tired of the company not rectifying its ‘misleading’ terms and conditions and has threatened to place sanctions if the business doesn’t comply. The terms and conditions are considered to be problematic as Facebook states that consumers’ data and content is solely used to enhance their overall experience but nowhere specifies that the data is being utilised for commercial purposes.
Flipkart aggressively vying for top sales in upcoming festive season
Ahead of the festive season, Flipkart is gearing up to fiercely compete with fellow retailer Amazon. Flipkart’s Singapore entity has channelled Rs 34.63 billion into its main Indian e-commerce unit Flipkart Internet. The retail platform’s latest inflow of funds is a first after the company inked its $16 billion deal with Walmart.
Moreover, this move comes at a time where the online seller is vying for the top position in selling not just electronics, specifically smartphones and groceries. Flipkart is aiming to at least secure a 50% market share this upcoming festive season by planning 20 new launches and even offering dirt cheap prices to convert brick and mortar loyalists to keen online shoppers.
Myntra to foray into brick and mortar space
The online marketplace may have tonnes of players, however, Myntra seems to be travelling the other way. India’s largest online fashion retailer has been eyeing mall spaces to venture into the brick and mortar space to compete with the likes of Shoppers Stop and Lifestyle. Not only mall spaces, but the online seller is also not ruling out departmental stores. Their omni-channel strategy is being viewed as one of their most aggressive ones till date to cater to the needs of Indian customers who still hesitate to take to online shopping. Already having master franchise deals with labels like Spain’s Mango and Hong Kong’s Esprit to open their physical outlets, Myntra is also in the midst of talks with UK fashion brand Dorothy Perkins, although nothing has been officially stated.
Visa and MasterCard settle swipe fees case for $6.2 billion
After violating antitrust laws by fixing prices to benefit the banks, Visa and MasterCard, along with some top US banks, have finally put an end to their antitrust case. The antitrust settlement which is one of the largest ever to take place is that of $6.2 billion with US retailers over swipe fees. Not only is this the end of a 13-year-old lawsuit, but the settlement agreed upon is also much higher. Albeit the previously settled suit was that of a value $900 million lesser, amends have been made to reach the $6.2 billion value after merchants were vocal about the previous settlement being unfair and overturned on appeal. The largest retailers in the American market like Walmart, Target and Kroger have however opted out of the deal as they believe they can arrive at better negotiations which are expected to be higher by $200 million.
Abhiruchi Ranjan is a writing analyst at Qrius