European Regulators Awaiting Response From Apple After Spotify Called the App Store a Monopoly

European Regulators Awaiting Response From Apple After Spotify Called the App Store a Monopoly

The European Commission is awaiting a response from Apple after Spotify accused the iPhone maker of anticompetitive business practices in relation to its App Store, said the European Union’s antitrust chief Margrethe Vestager.
“We are looking into that and we have been asking questions around in that market but of course also Apple themselves, for them to answer the allegations. And when they come back, we will know more,” said Vestager, speaking on the sidelines of an economic conference, according to Reuters.

In March, Spotify announced it had filed an antitrust complaint against Apple with the European Commission over unfair App Store practices. Apple responded two days later, labeling the complaint as “misleading rhetoric” and arguing that “Spotify wants all the benefits of a free app without being free.”

In a blog post, Spotify founder and CEO Daniel Ek took particular issue with Apple charging a 30 percent “tax” on App Store purchases. This results in Spotify charging existing subscribers $12.99 per month for its Premium plan via the App Store just to collect nearly the $9.99 per month it charges normally.
Apple also forbids developers from alerting users that they can sign up for a subscription or complete a purchase outside of an app, which would bypass Apple’s commission on in-app purchases tied to digital goods.

Spotify later said “every monopolist will suggest they have done nothing wrong” and that Apple’s response was “entirely in line” with its expectations.

Apple has faced increasing scrutiny as of late over the way it runs its App Store, beyond Spotify’s complaint. In the United States, for example, the Supreme Court recently ruled that a class action lawsuit accusing Apple of operating an App Store monopoly can proceed to trial in a lower court.

Parental control app developers have also petitioned Apple to release a public API for its Screen Time feature to ensure a fair playing field on the App Store, while the Netherlands is investigating whether or not Apple favors its own apps.

In response, Apple added a new page to the App Store section of its website titled Principles and Practices, noting that the App Store was created with two goals: to be “a safe and trusted place for customers to discover and download apps” and “a great business opportunity for all developers.” Apple emphasized that the App Store “welcomes competition” and listed many examples of third-party apps that compete with its own apps, such as Spotify versus Apple Music and Google Maps versus Apple Maps.

We believe competition makes everything better and results in the best apps for our customers.

We also care about quality over quantity, and trust over transactions. That’s why, even though other stores have more users and more app downloads, the App Store earns more money for developers. Our users trust Apple — and that trust is critical to how we operate a fair, competitive store for developer app distribution.

The deadline for Apple’s response to the European Commission is unclear.

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