The EU will investigate Spotify’s antitrust complaint about Apple

By Michael Grothaus

The European Commission will launch a probe into whether Apple is unfairly using the App Store to disadvantage competitors, reports the Financial Times. The antitrust investigation comes after Spotify filed a formal complaint with the European Commission in which it said that Apple’s App Store rules “purposely limit choice and stifle innovation at the expense of the user experience.”

Specifically, Spotify’s complaint focuses on Apple’s 30% cut of App Store sales, including subscriptions that Spotify users sign up to via the Spotify iOS app. As Spotify argued in a blog post back in March:

To illustrate what I mean, let me share a few examples. Apple requires that Spotify and other digital services pay a 30% tax on purchases made through Apple’s payment system, including upgrading from our Free to our Premium service. If we pay this tax, it would force us to artificially inflate the price of our Premium membership well above the price of Apple Music. And to keep our price competitive for our customers, that isn’t something we can do.

Apple then hit back at Spotify saying the company “seeks to keep all the benefits of the App Store ecosystem–including the substantial revenue that they draw from the App Store’s customers–without making any contributions to that marketplace.” Apple also alleged that Spotify was being misleading in its complaint, saying:

The only contribution that Apple requires is for digital goods and services that are purchased inside the app using our secure in-app purchase system. As Spotify points out, that revenue share is 30 percent for the first year of an annual subscription–but they left out that it drops to 15 percent in the years after.

The European Commission has not yet commented publicly on their pending investigation into Apple’s business tactics, but the Financial Times says their formal antitrust investigation will launch in “the next few weeks.” At the time of this writing, neither Apple nor Spotify has publicly commented on the Financial Times’ report.

 

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