The European Commission today fined Apple €1.8 billion ($1.95 billion) for anti-competitive conduct against rival music streaming services. In a response published on its website, Apple fiercely attacked the Commission's decision, as well as Spotify's behavior.
The fine comes as the conclusion to a long-running investigation by the EU, triggered by a complaint from Spotify, into Apple's treatment of third-party music streaming services on the App Store. The Commission now says that Apple abused its dominant position in the market by forbidding music streaming apps to tell users about cheaper subscription prices outside the app.
The European Commission has fined Apple over €1.8 billion for abusing its dominant position on the market for the distribution of music streaming apps to iPhone and iPad users ('iOS users') through its App Store. In particular, the Commission found that Apple applied restrictions on app developers preventing them from informing iOS users about alternative and cheaper music subscription services available outside of the app ('anti-steering provisions'). This is illegal under EU antitrust rules.
In an extensive public response, Apple noted that while Spotify has a dominant, 56 percent share of Europe's music streaming market and a "large part of their success is due to the App Store," the company does not pay anything to Apple because it refuses to sell subscriptions in its app. Apple listed a large number of services that it provides to Spotify for free, such as distribution, APIs, frameworks, TestFlight, App Review, and in-person engineering assistance. "But free isn't enough for Spotify," Apple says. "They also want to rewrite the rules of the App Store — in a way that advantages them even more."
Instead, Spotify wants to bend the rules in their favor by embedding subscription prices in their app without using the App Store's In-App Purchase system. They want to use Apple's tools and technologies, distribute on the App Store, and benefit from the trust we’ve built with users — and to pay Apple nothing for it.
Apple said that Spotify claimed in 2015 when it started working on the investigation with the European Commission that the "digital music market had stalled, and that Apple was holding competitors back." "Unfortunately for their case, Spotify continued to grow," Apple added.
Apple noted that three different related cases mounted against it by the European Commission over the past eight years consistently found no evidence of consumer harm and no evidence of anti-competitive behavior.
The reality is that European consumers have more choices than ever. Ironically, in the name of competition, today's decision just cements the dominant position of a successful European company that is the digital music market's runaway leader.
Apple also said that it is set to comply with the EU's Digital Markets Act (DMA) within days, alluding to the release of iOS 17.4, which includes a number of significant changes for users in Europe to meet the legislation's requirements. It believes that today's fine is "an effort by the Commission to enforce the DMA before the DMA becomes law," since it is "not grounded in existing competition law." Apple plans to appeal the decision.
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