Thursday, 21 March, 2019

Spotify files antitrust complaint to Brussels against Apple

Spotify CEO Daniel Ek Daniel Ek has been CEO of Spotify since he co-founded it in 2006. Spotify
Kayla Schwartz | 14 March, 2019, 14:16

The company has today (March 13) announced that it is filing an anti-trust complaint against Apple with the European Commission, regarding the latter company's controversial "app tax".

"In recent years Apple has introduced rules to purposely limit choice and stifle innovation at the expense of the user experience - essentially acting as both player and referee to deliberately disadvantage other app developers", Daniel Ek, Spotify chief wrote in a blog post.

Spotify and Apple Music are the two major players in the streaming music market: While Spotify's global paid subscriber total of 96 million is almost double Apple Music's 50 million, it was reported last summer that Apple Music has more U.S. subscribers.

Spotify's beef with Apple centers on a 30 percent tax it and other digital services have to pay whenever they use Apple's "in-app" payment system to process user purchases such as upgrading subscriptions. That is the 30% of monthly subscription fees that Apple takes on subscriptions made through its payment system.

Spotify opted not to use the in-app purchase (IAP) system Apple provided, and the company alleges that the decision led to second-class treatment from Apple.

He said that if Spotify chooses not to use Apple's payment system, to avoid paying the commission, the company applies "a series of technical and experience-limiting restrictions" on consumers running its streaming service on the rival tech company's devices.

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"For example, they limit our communication with our customers - including our outreach beyond the app. In some cases, we aren't even allowed to send emails to our customers who use Apple".

Swedish music site Spotify has complained to European Union regulators about Apple for allegedly abusing its dominant position in music streaming and stifling competition.

Spotify wants the same treatment as other App Store apps like Uber and Deliveroo, "who aren't subject to the Apple tax and don't have the same problems".

Spotify has filed an antitrust complaint against Apple with Europe's competition watchdog, arguing that the way it runs the App Store is anticompetitive.

Apple hasn't as of the time of this writing responded to requests for comments about Spotify's action, while a spokesperson for the European Commission told The Wall Street Journal that Spotify's complaint has been received and is being reviewed. "We should all be subject to the same fair set of rules and restrictions, including Apple Music". In the US, Spotify covers these costs by charging people $12.99 per month for subscriptions completed via the App Store; it's $9.99 if you subscribe directly via Spotify's website and then sign in via the iOS app.

Ek specifically highlighted the 30 percent fee that Apple charges for app payments made through its system. He reckons the Apple-licensed "App Store" should remain objectively unbiased with the market place should remain inconquerable.

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