Spotify Accuses Apple of Stifling Competition in Antitrust Complaint
Photo Credit: (COMBO) This combination created on March 13, 2019 of file illustrations displayed on tablet screens shows the logo of the US multinational technology company Apple (bottom, February 18, 2019 in Paris) and the logo of online streaming music service Spotify (April 19, 2018 in Paris). – Swedish music streaming giant Spotify said on March 13, 2019 it had filed a formal complaint with the EU Commission against Apple, accusing its US rival of stifling competition in the online music market. (Photo by Lionel BONAVENTURE / AFP) (Photo credit should read LIONEL BONAVENTURE/AFP/Getty Images)
This morning, Spotify announced it has filed a complaint against Apple with the European Union’s antitrust branch, accusing Apple of stifling competition through its “Apple tax.”
A spokesman for the European Commission, the EU’s antitrust arm, confirmed with The Wall Street Journal that they’d received a Spotify complaint they are “assessing under our standard procedures.”
Spotify’s main complaint centers around two things. First, the company alleges that Apple is restricting music-streaming services in competition with its own Apple Music. In addition, Spotify has beef with Apple’s notorious 30 percent “tax.”
Apple takes a 30 percent cut from any subscriptions that are made via the App Store. In the past, this has led to tension with companies like Netflix, who removed the iTunes billing option in December 2018.
“In recent years, Apple has introduced rules to the app store that purposefully limit choice and stifle innovation at the expense of the user experience,” Spotify’s CEO Daniel Ek’s said in Spotify’s announcement, “essentially acting as both a player and referee to deliberately disadvantage other app developers.”
In its complaint, Spotify alleges that this “tax” makes it so its pricing cannot remain competitive. To make a profit, Spotify and other streaming services have to “artificially inflate” prices “well above the price of Apple Music.” If Spotify tries to skip paying, Apple applies “a series of technical and experience-limiting restrictions.”
According to Ek, other apps like Uber and Deliveroo — notably, apps who are not in competition with any Apple services — aren’t subject to the tax.
This announcement comes only a day after Spotify released a new bundle with Hulu. Some wondered if the $9.99 bundle was as a pre-emptive move from the two platforms because there are rumors that Apple will reveal its video service later this month and bundle that with Apple Music.
There’s currently no way to know what will happen with Spotify’s complaint. However, the European Union has cracked down on big tech and anti-competitive behavior over the past few years. In 2018, Google was fined a record $5 million for antitrust violations.
Considering that, Spotify’s campaign may actually have an impact.