Sour note as Spotify files EU antitrust complaint against Apple

An antitrust complaint has been filed with the European Commission by music streaming platform Spotify against Apple, alleging the California tech giant engages in anticompetitive behaviour.

Spotify is claiming that the way Apple manages its App Store gives its Apple Music streaming service an advantage over rivals such as Spotify and Deezer.

‘Consumers win and our industry thrives when we’re able to challenge each other on fair footing’
– DANIEL EK

The Stockholm-founded music platform also alleges that the 30pc tax on in-app purchases levied by Apple in the first year causes rivals to jack up the price of premium membership above what Apple itself charges.

What the Ek?

“After careful consideration, Spotify has filed a complaint against Apple with the European Commission (EC), the regulatory body responsible for keeping competition fair and non-discriminatory,” Spotify CEO and co-founder Daniel Ek said in a blogpost.

“In recent years, Apple has introduced rules to the App Store that purposely limit choice and stifle innovation at the expense of the user experience – essentially acting as both a player and referee to deliberately disadvantage other app developers. After trying unsuccessfully to resolve the issues directly with Apple, we’re now requesting that the EC take action to ensure fair competition.

“Apple operates a platform that, for over a billion people around the world, is the gateway to the internet. Apple is both the owner of the iOS platform and the App Store – and a competitor to services like Spotify. In theory, this is fine. But in Apple’s case, they continue to give themselves an unfair advantage at every turn.

“To illustrate what I mean, let me share a few examples. Apple requires that Spotify and other digital services pay a 30pc tax on purchases made through Apple’s payment system, including upgrading from our free to our Premium service. If we pay this tax, it would force us to artificially inflate the price of our Premium membership well above the price of Apple Music. And, to keep our price competitive for our customers, that isn’t something we can do.”

Infographic: Spotify Is Pulling Away From Apple Music | Statista

Infographic: Statista

Ek said that if Spotify chose to forgo using Apple’s payment system, then Apple would apply a series of technical and experience-limiting restrictions on Spotify.

He also alleges that Apple limits communications with Spotify customers in terms of outreach beyond the app, prevents Spotify from sending emails to customers who use Apple, and routinely blocks experience-enhancing upgrades, including locking Spotify out of Apple services such as Siri, HomePod and Apple Watch.

“We aren’t seeking special treatment. We simply want the same treatment as numerous other apps on the App Store, like Uber or Deliveroo, who aren’t subject to the Apple tax and therefore don’t have the same restrictions.”

Ek has called for a level playing field for apps on the App Store, including Apple Music, and said that consumers should have a choice of payment systems rather than be locked into Apple’s system. He also called for the App Store not to be controlling the communications between services and consumers.

“Competition pushes us to evolve and improve both the customer and creator experience. It’s not something we ever have – or will – shy away from. So, let me be clear that this is not a Spotify-versus-Apple issue. We want the same fair rules for companies young and old, large and small. It is about supporting and nurturing the healthy ecosystem that made our two companies successful in the first place.

“Consumers win and our industry thrives when we’re able to challenge each other on fair footing. That’s what competition on the merits is all about,” Ek said.

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