Apple has been hit with a €1.8 billion ($1.95 billion) antitrust fine by European Union regulators for abusing its dominant position on the market for the distribution of music streaming apps, such as Spotify or Apple Music.
On Monday, the European Commission said Apple had put restrictions on app developers that prevented them from informing customers about alternative and cheaper music subscription services available outside of its App Store. Apple had also banned developers of music streaming apps from providing users with any instructions on how to subscribe to cheaper offers.
Apple’s conduct, which the Commission alleges has gone on for nearly 10 years, may have led iOS users to pay “significantly higher prices” because of the company’s high commission fee for developers.
“From now on, Apple will have to allow music streaming developers to communicate freely with their own users, be it within the app, or by email, or any other way of communicating,” Margrethe Vestager, the European Commission executive vice president overseeing competition policy, said in a Monday news conference.
The fine is the first that Apple has received from the Brussels-based agency, which opened an investigation into the company after a complaint from Spotify in March 2019.
Cupertino, California-based Apple fired back against the Commission, stating that the decision was reached “despite the Commission’s failure to uncover any credible evidence of consumer harm.”
Apple also took a shot at Stockholm-based Spotify, alleging that the company is both the “primary advocate” and “biggest beneficiary” of the decision.
The company then claimed pride in its “key role supporting Spotify’s success,” noting that the Swedish streamer has a 56% share of Europe’s music streaming market and pays Apple “nothing for the services that have helped make them one of the most recognizable brands in the world.” The Spotify iOS app has been downloaded or updated from Apple’s App Store more than 119 billion times across 160 countries.
“But free isn’t enough for Spotify,” Apple said. “They also want to rewrite the rules of the App Store — in a way that advantages them even more.”
For its part, Spotify praised the Commission’s decision, writing that Apple’s rules “muzzled” it and other music streaming services from directly sharing benefits with its users.
“Of course, Apple Music, a competitor to these apps, is not barred from the same behavior,” Spotify said in a statement. “By requiring Apple to stop its illegal conduct in the EU, the EC is putting consumers first. It is a basic concept of free markets — customers should know what options they have, and customers, not Apple, should decide what to buy, and where, when and how.”