European Commission regulators sided with Spotify, accusing Apple of breaking EU competition law and abusing its monopoly over how music streaming apps are distributed through its app store.
This preliminary finding by EU officials means Apple has 12 weeks to formally respond. If the tech giant doesn’t satisfy regulators, the Associated Press said the company could be fined up to 10% of its annual revenue. Since Apple reported a revenue of US$274.5 billion (~RM1.1 trillion) in its latest financial year, it could be liable to pay a fine of up to US$27.4 billion (~RM112.2 billion).
EU launched an antitrust probe into the Apple App Store based on a 2019 complaint lodged by Spotify, CNBC said. Apple forces app developers to pay a 30% commission on all subscription fees that come through the App Store. It also prevents developers from informing users of alternative (and cheaper) ways to pay for subscriptions without going through the App Store.
Regulators zeroed in on both these practices as their key concerns.
Our preliminary conclusion: @Apple is in breach of EU competition law. @AppleMusic compete with other music streaming services. But @Apple charges high commission fees on rivals in the App store & forbids them to inform of alternative subscription options. Consumers losing out.
— Margrethe Vestager (@vestager) April 30, 2021
Unsurprisingly, Apple lambasted the EU’s position as the “opposite of fair competition.”
“Spotify has become the largest music subscription service in the world, and we’re proud of the role we played in that,” Apple said, according to CNBC. “Once again, they want all the benefits of the App Store but don’t think they should have to pay anything for that.”
Spotify naturally applauded the stance of EU regulators. Relatedly, Epic Games has also filed an antitrust complaint against Apple in the EU, in addition to suing the latter in the US.