Apple hits back at Spotify

Apple accuses Spotify of trying to get “limitless” access to its tools without paying.

Apple has hit back at Spotify over the long-running competition complaint filed with the EU that could see Apple face a huge fine if found guilty.

After reports the bloc has concluded its investigation into the music streaming service’s claims of anti-competitive behaviour by Apple over its App Store rules, with the prospect of a €500m (£425m) fine, Apple has accused Spotify of trying to get “limitless” access to its tools without paying.

Spotify filed a complaint with the EU in 2019, claiming that App Store rules limit choice and competition because Apple charges a 30% fee on purchases made through the store including music streaming subscriptions.

Spotify argued it is an unfair “tax” that Apple’s own competing Apple Music streaming service is not subject to, giving it an unfair advantage. The company has also argued that Apple’s rules do not allow it to tell users about cheaper ways to subscribe outside the App Store.

The EU has been investigating Apple’s position in the music streaming app market, and has whittled down its investigation to focus on certain restrictions imposed on app developers by Apple. These restrictions prevent developers such as Spotify from telling iPhone and iPad users about cheaper music subscriptions that are available outside the App Store. Spotify argues that this benefits the tech company’s rival app, Apple Music.

In a statement, Apple said Spotify did not offer subscriptions via the App Store and therefore did not pay Apple any commission in the EU.

“We’re happy to support the success of all developers – including Spotify, which is the largest music streaming app in the world,” Apple said. “Spotify pays Apple nothing for the services that have helped them build, update and share their app with Apple users in 160 countries spanning the globe.

“Fundamentally, their complaint is about trying to get limitless access to all of Apple’s tools without paying anything for the value Apple provides.”

According to reports earlier this week, the European Commission is close to concluding its investigation.

Apple said Spotify had the option to directly link to its website for account creation and management but chose not to exercise it.

The US-based firm added that despite claims of competition concerns and not allowing it to tell users how to subscribe, Spotify had grown into the largest digital music business in the world with more than 50% market share in Europe.

It also argued that Spotify and other music streaming services had many open channels, including email marketing and social media, to advertise to consumers and show them how to sign up outside the App Store.

Apple has also criticised EU regulators, claiming that despite the issue being examined in different forms for about 10 years, the European Commission had failed to find any evidence of consumer harm or anti-competitive behaviour by the firm in this market.

The company said the investigation could just cement Spotify’s dominant position as the market leader, rather than promote competition.

To conform with the DMA, Apple is introducing big changes to the iPhone’s iOS software, including permitting alternative marketplaces.

When Apple announced the changes, some companies were disdainful, not least because the updated iOS rules introduced required app developers in rival marketplaces to pay something called the Core Technology Fee of $0.54 (0.5€) for each download after the first million to have access to security and other functions.

Apple’s argument is that if it is providing an infrastructure for apps to work safely and in a protected, maintained environment, it seems fair that some costs should be passed on.

There’s no doubt Spotify has gained considerable benefits from being in the App Store. Its app has been downloaded or redownloaded or updated over 119 billion times on Apple devices, Apple says. And Spotify pays nothing for that convenience and reach. App Store review team members have reviewed and approved 420 versions of the Spotify app, often turning around reviews on the same day. This is another feature which is cost-free to Spotify and all other app developers