The European Commission is reportedly investigating claims that Apple Inc. (AAPL) has been hamstringing music streamers, such as Spotify Technologies SA (SPOT). This investigation was triggered by a Spotify complaint in which the Swedish music streaming service claimed that it had to increase monthly subscription prices to cover Apple’s 30% fee on all of its app store purchases.
Apple faces €500m fine over Spotify access
Apple also allegedly blocked firms such as Spotify from informing customers that they can get the service cheaper if they subscribe directly via the website. Apple faces a €500m fine should the EU find it guilty of infringing competition laws.
The Guardian reported that Apple finds these fees reasonable as it provides apps with a highly secure app store and opens the door to a large customer base. Spotify, however, pointed out that Apple’s own music streaming service does not pay these costs, giving it an unfair competitive advantage.
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Bloomberg reported that when Apple was approached for comment, it referred to an earlier statement, which said:
App Store has helped Spotify become the top music streaming service across Europe.
Promoting fair competition and preventing big-tech dominance in the European market is a key EU strategy. Previously, Margrethe Vestager, the EU’s competition chief, penalised Alphabet Inc. (GOOG) to the tune of €8bn. She was also behind Apple’s €13bn repayment order for the Ireland tax issues.
On top of this, Apple was also fined €1.1bn in France for anti-competitive practices. Upon appeal, this amount was reduced to €372m. The latest investigation comes as the EU’s Digital Market Act comes into effect on 7 March 2024.
