Post updated May 8th, 2019 at 01:31 am
Back in March, Spotify filed a formal complaint against Apple to the European Commission (EC) over its 30% revenue cut. And now, it looks like the EC will be finally making its move to launch a formal investigation.
Daniel Ek, CEO of Spotify, claims that this forces the company to artificially inflate its subscription prices, making it more expensive than Apple’s own music subscription service. Not paying this “tax”, on the other hand, leads to “a series of technical and experience-limiting restrictions.”
Apple has responded to Spotify’s claims, stating that the latter wants to make use of all the benefits provided by the former’s App Store, without contributing to its upkeep. Some of the benefits in question include, as Apple claims, the platform to connect Spotify to its users, and a secure payment system.
For context, Apple takes a 30% cut from all revenue for subscriptions paid via the App Store in the first year. Subsequent years will see Apple take 15% from Spotify’s subscriptions. The entire process is not likely end anytime soon, but if Apple is found guilty, it could be fined up to 10% of its global revenue.