What the IndiGo fiasco tells us: The role played by the state is being taken over by mega corporations

A generation ago, you were courted by multiple companies vying for your money. Today, you sit within an ecosystem where opting out is costly, inconvenient and often practically impossible. Be it insurance renewals, broadband service packs or credit card rewards, you are trapped. Legalese aside, the choices on offer are hardly volitional. It happens when scale, technology and capital converge faster than regulation.

In India, the social implications feel more acute because the private sector is running systems once expected of the state. Telecom coverage, digital-payment rails, data distribution, identity-linked credit and logistics networks are all public goods. They offer extraordinary convenience but lock citizens into corporate interfaces that resemble those of a passport office more than a marketplace.

When switching costs turn prohibitive, loyalty is indistinguishable from captivity. An exit is not a right but a loss. You can raise your voice or plead, but the system need not listen. An uneasy question then arises. Has private-sector ascendancy left Indian consumers weak? We are witnessing a new form of dependence. It does not stem from scarcity, as it once did, but from abundance delivered through a single gatekeeper.

Competition exists, but substitutability does not. Consumers no longer choose between providers but adopt bundled lives across telecom, media content, shopping, travel and payments. Leaving involves too much friction. So you optimize your routines around a single platform ecosystem by renewing subscriptions, aligning payments and syncing deliveries. You gain orderliness but lose spontaneity. Even the recommendations you get are motivated.

What once made consumers powerful has receded as India flirts with a chaebol or zaibatsu model. South Korea created chaebols or large conglomerates to accelerate its industrialization. Japan’s zaibatsu emerged when private capital filled gaps in state capacity. We increasingly seem to have an ‘industrial-commercial complex’ in India that controls not only markets, but the conditions under which they function.

Old-world industries look jaded. Digital infrastructure has taken the place of steel plants. Data centres have replaced textile mills. Supply chain coordination is the new management mantra. A mega-corporation is one that owns payments, data and identity integration.

India can afford such concentration, provided we create supporting conditions that are yet to fully materialize. These include interoperability mandates, consumption portability and firewalls between platform ownership and marketplace participation where this enables more rivalry. Without these, we could find ourselves at the mercy of monopoly power all around.

End-to-end consolidation has a paradoxical effect on the consumer experience. In the short-term, customer value improves sharply as prices fall and convenience rises. Ordering, paying, streaming, scheduling— all this becomes easier. However, the character of the experience changes. What once came from competition now comes from standardization. When a single platform defines what ‘good service’ means, it is no longer an aspiration but a template. Can templates be allowed to evolve without consumer inputs? Let’s think about that.

A customer experience that is uniform and predictable may also be non-negotiable. If what’s valuable to a business is caged, loyalty becomes just a computation. This raises the uncomfortable question of whether convenience cramps our agency as individuals, and if so, at what point?

In India, convenience comes bundled with a loss of privilege. If you leave a platform, besides access, you lose the accumulated privileges of delivery tiers, cashback currency, subscription parity and stored identity authentication.

It turns out that we, as consumers, have traded agency for efficiency, optionality for reliability and diversity of providers for consistency of experience. And power rarely flows back to people once it is ceded.

We are at a pivotal moment. India has what it takes to build the world’s most open commercial ecosystem in the world, as we did with UPI by enforcing interoperability, making consumer data portable and setting up regulatory firewalls that separate infrastructure from commerce. But we may just as easily drift into a future where a few corporations dictate the operating system of everyday life.

Does India need mega-corporations? Of course it does. Our country is too large and ambitious not to seek the benefits that arise from large-scale operations.

The question is one of public accountability. The difference between empowerment and dependence is whether consumers can walk away painlessly. We must decide whether we want value-delivering corporations or ones we simply cannot do without.

The author is a marketing strategist, former chief marketing officer, Tata Motor and the APAC representative on the Effie LIONSFoundation board.