In studying Buddhism and its interactions with other religions I have been repeated struck by how different the Indian situation was and is from the West. I'm going at attempt to characterise the two situations by looking at two businesses. The Indian religious milieu is to my mind like the micro-computer market in the 1970's and 80's. Whereas Western Religion is like the telecommunications market. Both of these are dominated by an large monopolistic corporation, but the models are quite different.
Christianity has towered over the religious landscape of Europe and it's colonies for centuries now. For many years it was not only the local state sanctioned monopoly, but a Europe wide monopoly so powerful that it could dictate to kings. Heterodoxy was not tolerated. It strikes me that a similar situation existed in the US for most of the 20th century. The Bell System (aka AT&T) company's domination of the telecommunications market was near total. They owned the infrastructure for the entire telephone network, and entry into the market was virtually impossible except for a few very small niches. Bell used it's monopoly position, even used illegal practices, to stifle competition - resulting in a lawsuit by the Department of Justice. The Catholic Church too was concerned to stifle competition. We know that they used terror, torture, and murder to maintain their dominant position. The crusades were as much about making a profit as liberating the Holy Land.
If we follow this image then he break up of the Bell Company in the mid 1980's due to it's misuse of monopoly powers is matched in European Christianity by the reformation and the advent of competition in the form of Protestantism. Luther was protesting in particular about the selling of indulgences - the church offering to do the job of God (i.e. forgiveness of sins) and for a pay-off. Bell was attempting to use its enormous power to get a grip related technologies such as the fledgling computer industry. In both cases the upshot was a limitation on the power of the monopoly and the making of room for dissent/competition. Like Bell, the Church continued to be powerful. Like the Church, Bell continued to seek ways to expand their power by moving offshore and finding new markets in developing countries.
Taking this one step further I see the cellphone as equivalent to the rising popularity of both fundamentalism and non-aligned Christianity. The new technology was slow to start because it was expensive, but with the major infrastructure investment paid off, it is now cheap to offer cellphone services, and because these are closely linked to the aspirations and desires of the people, the uptake is massive. One can choose to subscribe, or to "pay as you go". Not only has the technology changed, but the market is open to competition, so that there are many cell-phone companies (which shops everywhere!). Fundamentalism was initially less popular for different reasons, but the popularity is similar to the cell-phone market now. They focus on a simple message (c.f. text messages) and focus on personal connections (with god and each other) and community. (I've previously argued that cell-phones are all about community.) Land-lines are still popular but will continue to decline in the face of increasingly personalised services, and evolving technology. Religion in the West is increasingly individualistic.
In India the story is very different. The Brahmins are still the arbiters of orthodoxy in India and this is because of an accident of history. The original inspired utterances of the sages came to be codified in a language which only Brahmins understood which helped to create and sustain their hegemony. Compare this with the beginnings of Microsoft. Bill Gates was already in business when he bought the operating system that would become known as MS-DOS, and then in a coup forged an agreement with IBM to have it installed on all of IBM's computers. The phenomenal success of IBM micro-computers made Gates a fortune. Microsoft has never been considered the best operating system by anyone involved in computers, but it is the most widely used, and dominates the market. Non-industrial software that does not work on Microsoft is destined for a small niche market.
This original success showed the way. Microsoft frequently expands by buying products from a successful start-up, re-branding it, and putting a lot of effort into marketing. The biggest example of this is Internet Explorer - now the most widely used Web-browser software. IE started life as a modified and re-branded version of the early web-browser Mosaic (now defunct). This is also the strategy of the Brahmins. The assimilation of Shiva is an example of this, but the cult of Vishnu is even more striking. Each of the 10 Avatars of Vishnu is a god from a smaller cult, incorporated into the Brahminical pantheon - including the 9th, Gautama Buddha, whose message is summed up by Vaishnavites as "be kind to animals". Microsoft also prospered by hiring successful programmers from other companies. So Charles Simonyi the designer of the early Xerox word processor "Bravo" joined MS in 1983 to create MS-Word which offered many of the same features. The Brahmins used this strategy as well. When they assimilated another cult they made the priests honorary Brahmins.
For many years Microsoft maintained it's dominance because it's software could run on any computer which used the MS operating system, and this was, because of licensing deals, any computer made by IBM, or later any computer which worked in the same way (what we used to call IBM clones). Equally the Brahmins made sure that every ritual, ceremony, and rite of passage in India required the chanting of Vedic mantras, and only they knew them.
While both religious hegemonies have maintained their dominance in the face of competition the fundamental strategies have differed. We humans, I observe, have two basic strategies when confronted with "the other" - that is with strangers, with people who are different. We of course prefer not to be confronted, but when we are we have these two basic responses which are exemplified by Christianity and Brahmanism. The Christian church on the whole has reacted by stamping out heresy. This has softened somewhat but the attitude is still entrenched. A high profile example of recent times is the Anglican/Episcopal Church's response to homosexual Bishops. The homosexual is defined as other, and while there have been many accommodations this seems to be the line beyond which some Christians are not willing to go. In the Catholic church woman are the other. We can attribute this to biblical fundamentalism, but this is to miss the essentially human response I think. After all many of the Bibles strictures are regularly overlooked - the prohibitions against usury for instance, or the setting up of market places in churches for instance (every cathedral in the UK has a shop in it!).
In India the response is quite different. The other is not destroyed if some kind of arrangement can be reached. More often than not the other is assimilated. Various cults that were distinctly non-Vedic, have quietly been welcomed to the fold - "all is one, god is good". Perhaps it is the advantage of having a pantheon rather than a monotheon, but again this is a basic human response to otherness - try to make the other one of us by conversion. If they are willing to become "us" then that's OK. Witness the concerns about immigration in the UK today - the word assimilation is heard on a daily basis in the news - the concern is "will they become English, or will they make us change?" It is worth noting that neither Islam nor Christianity have yet been assimilated in India. Is this because they do not follow the same response to otherness?
Buddhism follows the general Indian pattern. Many of the forms and conventions of Vedic India were co-opted by Buddhists in the early days. There is also a perceptible Jain influence. Later puranic Hinduism was a source. Sometimes this influence was a reaction against something by Buddhists and an attempt to create a distinction, but other times some chunk of Indian culture is lifted bodily out of it's context and "converted". Many of the Vedic/Hindu gods appear in Buddhist scripture for instance as converts to Buddhism. Indra continues to have an important role in Buddhist texts long after he has waned in the Hindu world! On the other hand this assimilation has lead to problems for Buddhists down to the present. Buddhists have had to waste a lot of energy in India arguing that Gautama is not an avatar of Vishnu. Buddhism has at times succumbed to the take over attempts - the two are equally mixed in Nepal for instance; and in front of the main temple in Wat Po, Bangkok is a Shiva lingam covered in fresh gold leaf offerings. Present day Indian Buddhists also face hostility to their conversion from Hindu Nationalists on top of assimilation attempts - paradoxical as that sounds. Buddhists marriages were recognised in Maharashtra only in 2007.
Of course both of these comparisons are over simplifications but I think they give the flavour of the differences in the religious cultures of Europe and India.