Brands Forced to Pay for Their Own Searches

Zerodha co-founder Nithin Kamath has raised serious concerns about how digital marketplaces and search engines control business visibility. He points to the practice of 'brand keyword bidding,' where companies are compelled to pay for ads to show up when users search for their own brand names. This turns organic search into a costly auction, allowing rivals to easily grab customer attention by bidding higher.

Kamath highlighted the growing number of ads on these platforms, with paid listings appearing both above and below normal search results. This makes it harder for users to find official brand listings without seeing many ads first. He sees this as a shift where platforms are increasingly charging for visibility.

Platforms as Costly Gatekeepers

Kamath also criticizes these tech giants for acting as powerful gatekeepers. Despite talk of cutting out middlemen, app stores and search engines now control significant user access, charging businesses in many ways. They earn money from both transaction fees and advertising, forcing businesses into a constant cycle of spending to maintain visibility and engagement. Kamath suggests this system primarily benefits the platforms, with rising costs likely passed on to consumers.

In India, this issue affects the FinTech sector, which has seen significant investment, though funding is slowing as investors focus on profitability. Zerodha, a leading FinTech company, stands out as a bootstrapped business with strong revenue and profit margins, reporting ₹8,320 Crore in revenue and ₹4,700 Crore in net profit for FY24. By mid-2025, it served about 7.58 million users, facing competition from platforms like Groww (over 13 million active users) and Angel One. While Groww has more users, Zerodha leads in revenue and profit per user.

The 'Platform Toll' Faces Scrutiny

This 'pay-to-appear' model is a major hurdle for startups and small businesses without large ad budgets for keyword bidding. They risk being missed by customers looking for them, which hurts competition and helps bigger, wealthier companies. This echoes 'platform enshittification,' where platforms slowly take more value from users and businesses, worsening the user experience for more profit.

Regulators worldwide and in India are paying more attention to these dominant platforms. The Competition Commission of India (CCI) is investigating alleged anti-competitive practices by tech giants. Google faced a ₹936.44 crore fine in October 2022 for its Play Store policies, which included mandatory billing systems. Apple is also facing an antitrust battle in India over its App Store policies, which require using its payment system and take a cut.

These regulatory actions reflect a global trend of challenging monopolistic behavior by major digital platforms, impacting how businesses reach customers online. The Indian digital advertising market, valued at around ₹70,000 crore in 2024, is largely dominated by Google and Meta, holding an estimated 70-90% market share. However, new retail media platforms from Amazon, Flipkart, Zomato, and Swiggy are starting to challenge this dominance by directly linking ad spending to sales.

Competition Concerns: Startups at Risk

The widespread practice of forced keyword bidding and high visibility costs on major platforms raise serious antitrust concerns. This system creates an unfair playing field where money determines reach, potentially slowing innovation and limiting startups that can't afford constant ad spending. Google's 30% commission on in-app purchases has long been a heavy burden, hurting small businesses with tight profit margins. If companies must spend a large part of their budget just to show up for their own brand searches, it further cuts profits and diverts resources from product development and customer service.

While Zerodha operates efficiently, its co-founder's concerns point to a widespread problem for many digital businesses. The risk is that these gatekeeper platforms, by controlling access and dictating terms, are strengthening established companies and making it harder for new ones to enter the market. Large fines and ongoing investigations against Google and Apple worldwide highlight how these companies are seen as abusing their dominance. While aimed at fair competition, these regulations signal a changing and more complex environment for digital businesses.

Navigating the Changing Platform Economy

As digital platforms refine their money-making strategies, businesses must balance visibility costs with efficiency. Growing global regulatory scrutiny may lead to platforms operating differently, potentially offering fairer terms. For now, the 'pay-to-appear' reality means businesses need strong organic growth plans and diverse customer acquisition methods to rely less on these dominant, costly digital gatekeepers.