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Spotify Forces Apple To Confront Antitrust Accusations

Spotify has filed a complaint against Apple to the European Commission (EC) based on its alleged monopoly on its App Store, stifling competition in the music streaming market.
The complaint is based on claims that Apple has introduced certain rules in recent years that put rival developers in an economic and competitive disadvantage, to the expense of not only other streaming companies but to the user and their experience too.
Spotify said that it had attempted to resolve the issue directly with Apple to no avail, which is why it approached the EC, the regulatory body responsible for maintaining fair competition, for some authority on the matter.
The complaint focusses on the 30% tax Apple charges developers for using its in-app purchasing system (IAP) which includes upgrading from the Free Spotify version to its paid, subscription-based ‘Premium’ account which gives users an ad-free experience.
Charging the tax forced Spotify to raise its subscription fee from its initial price of €9.99, to €12.99 just as Apple Music launched for Spotify’s initial €9.99 price, according to Spotify’s general counsel Horacio Gutierrez.
He also said that the company was pressured into using Apple’s billing system in 2014 but then detached itself from the program so users can only upgrade through indirect means, such as through Spotify’s web page accessed by a laptop.
“We aren’t seeking special treatment,” said Daniel Ek, founder and CEO of Spotify in a blog post. “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.”
Apple also has a contingency plan for those, like Spotify, which are considering leaving its IAP. According to Ek, forgoing Apple’s IAP leads to the limitation of communications with customers by the tech giant.
Ek also claims that Apple has blocked its “experience-enhancing upgrades” which has resulted in Spotify being excluded from integration with Siri, HomePod and Apple Watch.
Spotify is requesting three changes to Apple’s operations:
First, apps should be able to compete fairly on the merits, and not based on who owns the App Store. We should all be subject to the same fair set of rules and restrictions–including Apple Music.
Second, consumers should have a real choice of payment systems, and not be “locked in” or forced to use systems with discriminatory tariffs such as Apple’s.
Finally, app stores should not be allowed to control the communications between services and users, including placing unfair restrictions on marketing and promotions that benefit consumers.
“Competition pushes us to evolve and improve both the customer and creator experience,” said Ek. “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.”
IT Pro has approached Apple for comment but the company has yet to reply.
The news couldn’t come in a more timely manner, at least that’s what Senator Warren could be thinking. Earlier this week we reported on how Warren seeks to break up big tech companies from monopolising their markets and stifling innovation from rivals.
She made proposals for the restructuring of companies such as Google, Amazon and Facebook, but the one she made against Apple seems quite fitting. She opined that Apple should not be allowed to both host its App Store while also hosting its own apps on the platform.
A day after her proposals were reported, Facebook was caught red-handed blocking Warren’s campaign posts made on the platform, the same site that she suggested should be disbanded from its WhatsApp and Instagram arms.
Facebook restored her posts, but not before she took to Twitter to vent her annoyance. (ITPRO)
cc:leadership.ng

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