Apple has vowed to appeal against the first-ever antitrust fine imposed by Brussels, following a case prompted by a complaint from Swedish music streaming giant Spotify.
The European Commission announced that it had found Apple guilty of applying restrictions on app developers, preventing them from informing iOS users about alternative and cheaper music subscription services available outside of the app. This practice, deemed illegal under EU antitrust rules, had persisted for almost a decade, potentially resulting in higher prices for music streaming subscriptions for iOS users due to the high commission fees imposed by Apple on developers.
The investigation into Apple’s conduct began in 2019 after Spotify lodged a complaint, leading to a broader inquiry by the commission in 2021. Last year, Brussels narrowed its focus to examine Apple’s actions aimed at preventing apps from providing users with information about rival music subscription options.
Commission Vice President Margrethe Vestager stated, “For a decade, Apple abused its dominant position in the market for the distribution of music streaming apps through the App Store.” She emphasized the Commission’s directive for Apple to remove the necessary provisions and refrain from similar practices in the future.
Apple responded to the decision by criticizing the Commission’s findings and announcing its intention to appeal. Despite the magnitude of the penalty imposed, critics highlight that fines exceeding hundreds of millions of euros are relatively minor compared to Apple’s substantial profits. In the last quarter of 2023 alone, Apple reported profits of $33.92 billion.
While Google has previously faced fines from Brussels, Apple’s penalty is expected to prompt the company to cease restricting access to rival streaming services, particularly in light of the upcoming Digital Markets Act (DMA), which it must comply with by March 7. The DMA grants the Commission the authority to levy fines of up to 10 percent of global revenue for violations or 20 percent for repeat offenders.
Apple disputes Spotify’s claims and points to the streaming giant’s dominance in the online music sector. Despite Spotify’s significant market share, Apple Music holds an eight percent share of the European market, according to Apple, compared to Spotify’s over 50 percent.
This dispute between Apple and Spotify is not unprecedented. Spotify has been a vocal critic of Apple’s App Store policies, particularly regarding compliance with the DMA. As part of its efforts to comply, Apple will allow rivals to develop app stores for iPhones and enable payment services beyond Apple Pay on its devices.
Spotify CEO Daniel Ek has accused Apple of undermining the spirit of the law with its approach. Recently, 34 digital organizations, including Epic Games and Spotify, expressed concerns to the Commission regarding Apple’s proposed changes, which they argue would undermine the DMA and the EU’s efforts to promote competitiveness in digital markets.
