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The European Commission is ready to rule On Spotify’s complaint Focusing on competition in the streaming music market, there are indications that the decision will not be in Apple’s favor. This week, Financial Times reported The EC will issue its first fine against a tech giant for allegedly breaking EU law on competition in the streaming music market. The fine is expected to be around €500 million (about $539 million USD), the report said.
Instead of framing the fine as a cost of doing business, as a company that made history First its value was estimated at 3 trillion dollars Sure enough, the tech giants are taking this fight to the masses.
In a statement shared with media today, Apple argued against the idea that Spotify was harmed by any anti-competitive practices on its part. (This statement was not issued by a single spokesperson, but comes from Apple itself). it reads:
“We are pleased to support the success of all developers – including Spotify, the world’s largest music streaming app. Spotify doesn’t pay anything to Apple for the services that have helped them build, update, and share their app with Apple users in 160 countries around the world. Fundamentally, their complaint is about trying to get unlimited access to all of Apple’s devices without paying anything for the value Apple provides.
Apple also revealed that Spotify has 56% market share, while Amazon Music has 20% and Apple Music has 11%. MIDiA’s 2022 report Subscription on the music market.
Additionally, Apple shared a number of non-public details about Spotify’s business as it relates to Apple’s platforms, for example, Spotify uses thousands of Apple’s APIs across the 60 frameworks; That Spotify uses Apple’s beta testing platform TestFlight; Spotify has submitted over 420 versions of its apps to App Review, which have been approved; And even Apple engineers have helped Spotify solve various challenges affecting hardware-accelerated media playback and battery optimization.
And, for those keeping an eye on those numbers, Apple also said that Spotify’s app has been downloaded, re-downloaded, or updated more than 119 billion times on Apple devices — a stat we haven’t heard before, us. Should pay attention.
The fact that Apple is pushing the EC decision with its comment is noteworthy in itself.
This speaks to a company that believes so strongly that it is doing what’s best for its customers and developer partners, so much so that any decision that seems otherwise is so absurd that it garners comments and feedback. Demands. Apple believes that the system of in-app purchases for things like music subscriptions not only saves consumers the headache and inconvenience of visiting external websites on the iPhone’s small screen – they can simply click a side button instead. Are – but also protects from fraud, excess. Data collection, consumer confusion over cancellation, and erroneous purchases by children. (Absolutely, Apple Is Familiar with latter yourself.)
Apple believes that Spotify only wants to increase its profits by taking advantage of the rules to its advantage. In the case of the EU complaint, the concern is that Apple’s App Store distorts absolutes in the music streaming market. In other words, this is not just a complaint that Spotify has been harmed, but that the nature of the App Store has failed other rivals.
EVP and competition chief Margrethe Vestager said of the EC investigation, “Spotify is a big player in the music streaming market, but we don’t know what the situation would have been without it.” back in 2021, “Apple Music has other competitors – there is Deezer, there is SoundCloud. Smaller competitors and here we have real concerns about their growth. This is not a Spotify issue – this is a music streaming issue,” he said.
However, Spotify has been the biggest of Apple Music rivals and has fought against the company in other cases, for example. Implementing Apple’s new DMA rules “extortion” and “complete and total farce.”
To protect its interests (and, Apple argues, consumers), Apple’s response to the EU’s DMA (Digital Markets Act) regulation is the introduction of a new system that requires developers to expand their services beyond just App Store payment processing. Need to pay for. Rather, it now separates payment processing from other services. By imposing “Core Technology Fee” For developers who want to do business under the new DMA rules. In other words, it wants developers to pay Apple for the work they do to build and maintain its iOS platform where apps can run, rather than accept that access to consumers’ favorite apps is limited to its iPhones. Helps in selling.
For the record, Apple denies Spotify’s claims that it was harmed by any anti-competitive practices. This reflects the success seen by Spotify over the past few years, which has grown its streaming app from 25 million to 160 million subscribers in 8 years – an average growth rate of 27%. It notes that Spotify users regularly subscribe to the service outside of its app, and Spotify qualifies for the “reader app” exception to Apple’s rules, which makes it directly eligible for account creation and payment, similar to Netflix. Allows linking to your website.
However, Apple ignores the fact that Spotify making quarterly profits still makes headlines, that it Just laid off 17% of its workforce, and that, you know, Spotify faces competition from Apple Music on iOS globally, which is preinstalled on iPhones, iPads and other Apple devices. In addition to being offered as a standalone service, Apple’s music streaming app is sold to customers as a part of Of Apple One bundlesWhich combines multiple Apple services, such as iCloud+, News+, Apple TV+ and others, under one roof.
Apple also emphasizes how closely Spotify has worked with the Commission on its complaint, having met with regulators more than 65 times since the investigation began. However, check been going on for years,
A representative for the EC declined to comment on news related to Spotify’s complaint or any pending fine. The FT reported that the fine was expected to be announced early next month.
Spotify was asked for comment but did not immediately respond. However, we expect one to come and will update when available.
Additional reporting: Natasha Lomas
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