TechnologyNews

Apple faces record-breaking EU fine over Spotify complaint

Apple

The European Union has imposed a historic fine of over 1.8 billion euros ($1.95 billion) on Apple for abusing its dominant position in the music streaming market. The decision follows a complaint by Spotify, the world’s largest music streaming service, which accused Apple of restricting competition and harming consumers.

Apple

 

Apple’s unfair practices

According to EU Competition Commissioner Margrethe Vestager, Apple violated EU antitrust rules by preventing Spotify and other music streaming apps from informing users of alternative payment options outside the Apple App Store. This meant that users had to pay a 30% commission to Apple for subscribing to these services through the App Store or use other methods that were less convenient and visible.

Vestager said that Apple’s practices distorted competition and reduced consumer choice in the music streaming market, which is worth billions of euros in Europe. She added that Apple’s conduct also harmed innovation and creativity, as it discouraged app developers from challenging Apple’s dominance.

Spotify welcomes the decision

Spotify, which filed the complaint in 2019, welcomed the EU’s decision and praised Vestager for taking a stand against Apple’s anti-competitive behavior. Spotify’s founder and CEO, Daniel Ek, said that the ruling was a “victory for every music lover, creator, and entrepreneur who wants a fair and competitive marketplace.”.

Ek said that Spotify’s goal was to create a level playing field for all app developers and give consumers the freedom to choose their preferred music service. He also called on Apple to comply with the EU’s order and remove its App Store restrictions as soon as possible.

Apple vows to appeal

Apple, on the other hand, criticized the EU’s decision and said it would appeal it in court. The US tech giant said that the decision was based on “flawed” arguments and ignored the realities of a thriving and competitive market. Apple also accused Spotify of being the main beneficiary of the decision, despite being the largest music streaming service in the world.

Apple said that Spotify did not pay any commission to Apple, as it sold its subscriptions on its website and not on the App Store. Apple also claimed that it provided Spotify with valuable tools and features to reach millions of users and grow its business. Apple said that it was proud of its role in supporting the music industry and creating opportunities for artists and fans.

Implications for the future

The EU’s decision is the first-ever antitrust fine imposed on Apple by the bloc and represents a significant blow to the company’s reputation and finances. The fine amounts to 0.5% of Apple’s worldwide turnover and is the second-largest antitrust fine ever issued by the EU, after the 4.3 billion euros ($4.6 billion) fine on Google in 2018.

The decision also sets a precedent for future cases involving Apple and other tech giants, as it shows the EU’s willingness and ability to enforce its competition rules and protect consumers’ interests. The EU is currently working on new legislation, known as the Digital Markets Act, which aims to prevent dominant platforms from abusing their power and imposing unfair conditions on app developers and users.

Written by
Jennifer Dixon

Jennifer Dixon is a passionate and professional news writer with over 15 years of experience in the media industry. She has worked as a reporter, editor, and correspondent for various news agencies such as Reuters, CNN, and BBC. She has covered a wide range of topics, from politics and business to culture and entertainment. She has a keen eye for detail and a flair for storytelling. She is also an avid reader and learner, always curious about the world and its people. Jennifer holds a master's degree in journalism from Northwestern University and a bachelor's degree in English from Yale University. She is currently working as a freelance writer and consultant, helping clients with their news and content needs. In her spare time, she enjoys hiking, yoga, and photography.

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