Spotify files anti-trust complaint against Apple over 'app tax' in EU

Mae Love
March 16, 2019

Spotify ended support for Apple's in-app subscription payments system for its premium service in 2016.

Ek is asking for three changes from the Europe Commission, firstly apps should be able to compete fairly on the merits not based on who owns the App Store. For instance, the HomePod or Apple Watch is only compatible with Apple Music at the moment while Spotify is off bounds on both platforms.

It's not the first time Apple has faced criticism over how it manages the App Store, and the demands it places on developers producing apps for iOS devices like iPhone and iPad.

"Once Apple became a platform provider, but also a direct competitor, their incentive to disadvantage rival services, like Spotify, became even greater and their restrictions started to become more frequent and extreme", Horacio Gutierrez, Spotify's general counsel, told journalists in a briefing in Brussels on Wednesday.

A spat between the companies that operate two of the biggest music streaming services in the world has landed at the doorstep of the European Union, which has been taking an increasingly tough stance lately against antitrust-related issues involving USA tech companies. ".If we choose not to use Apple's payment system, forgoing the charge, Apple then applies a series of technical and experience-limiting restrictions on Spotify", he writes.

The European Commission will surely take this complaint seriously.

App Stores should not be allowed to control the communications between services and users. Obviously, Apple doesn't tax itself the same 30% markup it does others, and why would they? The most prominent example is Apple's standoff with Amazon over Kindle e-books, which it wanted a cut of.

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The complaint was prompted by "an accumulation of increasing restrictions that we believe are extreme", he said.

The problem boils down to the fact that Apple won't allow Spotify to advertise that subscriptions are cheaper through its website, not the app.

A Spotify EU complaint brought against Apple says that Apple stifles competition because of Apple's 30% App Store tax.

Ek also explained that digital services like Spotify have to pay a 30% tax whenever there are purchases made through Apple's payment system, and this includes Spotify users upgrading their Spotify memberships. "After trying unsuccessfully to resolve the issues directly with Apple, we're now requesting that the [European Commission] take action to ensure fair competition".

Consumers should have a real choice of payment systems and not be locked down or forced to use Apple's discriminatory tariffs.

We've reached out to both companies and will update if we hear back.

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