Over the years, food delivery firms have launched and relaunched several loyalty programmes but have been unable to zero in on a definitive subscription plan. In June this year, Swiggy and Zomato slashed the radius within which premium members can enjoy free delivery, leading to an outrage on social media.

What’s The Problem? Customers with Swiggy One and Zomato Gold subscriptions are currently eligible for free delivery only on orders from restaurants within a 7-kilometre radius, lower than the previous 10 kilometres, and this is on top of the host of back-and-forth changes these platforms have made over the years.

Zomato launched its "Zomato Gold" in 2017 as an exclusive dine-out and social drinking membership program. In 2020, the company scrapped the programme to launch "Zomato Pro", followed by "Zomato Pro Plus" the next year.

In 2023, the food delivery giant relaunched "Zomato Gold" in its fourth iteration of its subscription programme. Since then, it has seen several variations, ranging from an increase in minimum order amount to the slashing of on-time delivery benefits.

The cycle has been no different for competitor Swiggy, which revamped its "Super" subscription services in 2021 to offer three different plans: "Binge", "Bite" and "Bit". Later that year, the company launched "Swiggy One", dubbing it "the only membership you will ever need."

Over the years, that too has seen a host of changes. Currently, the company offers its new users a Swiggy One membership at ₹1,199 for three months, but does provide a discounted price of ₹249.

See Also: Zomato Up 3% After UBS Hikes Target Price To Reflect 19% Upside

With the plethora of changes, users have often complained of confusion and lack of reliability. But the duopoly in the market leaves customers with very few options. Benzinga spoke to legal experts to explore the implications of this duopoly.

Expert Talk: Frequent changes to subscription plans can lead to consumer dissatisfaction and confusion. Swiggy and Zomato's ongoing adjustments, driven by competition, raise concerns under the Consumer Protection Act, 2019, which requires clear and transparent communication of terms, according to some experts.

Regular alterations to subscription packages without proper notice or clarity may be considered an unfair trade practice, says Kunal Sharma, partner at Singhania & Co.

"India's online food delivery space has become a duopolistic market which is restrictive to the customer, but there are legal risks associated due to volatile subscription plans and takeaways in both Swiggy as well as Zomato," Sharma adds.

However, their practice cannot directly be questioned, says Subhash Bhutoria, Founder and Principal at Law SB.

"Indian Competition laws do not recognise collective dominance, and hence the suggested duopoly cannot per se be questioned under the competition laws as such," Bhutoria says.

Food delivery platforms, like other e-commerce businesses, benefit from evolving technology driven by consumer use. To retain customers, these platforms must offer discounts and perks. Thus, subscription models are essential for maintaining this e-commerce ecosystem, he added.

"There is no direct legal action available for the consumer. The consumer will have to accept whatever is been put across unless there is some regulation in place to protect the consumer and facilitator… The consumer can only switch from one company to another," adds Alay Razvi, partner at Accord Juris.

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