After years long investigation, Apple got hit with first-ever EU fine for breaching antitrust rules in the market for music streaming services on its mobile platform, iOS.
In March 2019, Spotify officially filed an antitrust complaint against Apple in Europe, contending that Apple unfairly limits choice and competition through App Store rules and practices.
In a press release on Monday, the EU Commission said its investigation found that “Apple bans music streaming app developers from fully informing iOS users about alternative and cheaper music subscription services available outside of the app,” in addition to preventing app providers from sharing instructions on how to subscribe to such offers.
“For a decade, Apple abused its dominant position in the market for the distribution of music streaming apps through the App Store,” said Margrethe Vestager, Executive Vice-President in charge of competition policy. “They did so by restricting developers from informing consumers about alternative, cheaper music services available outside of the Apple ecosystem. This is illegal under EU antitrust rules, so today we have fined Apple over €1.8 billion.”
Apple said it will appeal the EU decision. The company claimed Europe’s digital music market was “thriving” and that the European Commission’s probe failed to “uncover any credible evidence of consumer harm.”
“In 2015, Spotify started working with the European Commission on an investigation with little grounding in reality,” the tech giant said in part. “They claimed the digital music market had stalled, and that Apple was holding competitors back. Unfortunately for their case, Spotify continued to grow — and thanks in part to the App Store, eclipsed every other digital music business in the world.”
Apple claimed Spotify has a 56% share of Europe’s music streaming market, more than double its closest competitor, and that Spotify “pays Apple nothing for the services that have helped make them one of the most recognizable brands in the world.”
Spotify said in a statement that European Commission’s ruling “sends a powerful message — no company, not even a monopoly like Apple, can wield power abusively to control how other companies interact with their customers.”
The EU’s fine comes as Apple is preparing to overhaul its app distribution rules in the EU in order to comply with the Digital Markets Act (DMA) from March 7th, for the first time allowing third-party app marketplaces on the iPhone.
