Apple facing €500m fine over App Store practices limiting competition
Written by WOM writer on February 21, 2024
Last month, Spotify called Apple’s 27% fee hike for developers directing users away from the App Store “outrageous”.
Apple is staring down the barrel of a €500m fine from the EU over the restriction of users’ access to competing streaming services via its App Store, according to the Financial Times.
When Apple recently announced it would be charging developers a 27% fee hike for signups from customers who came from the App Store, Spotify quickly expressed its concerns, calling the move “outrageous”.
Per Mixmag, in 2023, the European Commission issued Apple a Statement of Objections – citing “anti-trust” concerns – after it discovered Apple had prevented app developers from informing users about other music streaming subscription options at lower prices outside the app.
The statement declared that failure by Apple to comply would result in a fine of up to 10 per cent of Apple’s worldwide turnover.
Spotify also filed a complaint with the EU in 2019 detailing concerns surrounding Apple’s practices, claiming that the Cupertino tech giant and its 30% fee on purchases within the App Store was limiting competition and consumer choice.
According to The Guardian, Apple says its fees are justified due to the “hundreds of millions” of potential customers it gives Spotify access to. Countering the argument, Spotify says that because Apple’s own streaming service, Apple Music, doesn’t face the same fees, it gives it an unfair advantage and makes the fees customers see “anti-competitive”.
The fine – if issued – will be the first Apple has received from the European Commission, but it has seen itself fall foul of regulations before. In 2020, the company received a €1.1 billion fine from France – later revised to €370m – for anti-competitive agreements with two wholesalers.
Approached by The Verge for a statement, an Apple representative said the company would not be “commenting on speculation” surrounding the fine, and referred it to previous comments made by another Apple spokesperson, who said the case has “no merit”.
Source: Sam Roche – musictech.com
