Music streaming service tags this move as ‘anticompetitive’ adding that this ‘will cause grave harm to Spotify and its customers’. Swedish digital music service, Spotify alleged that Apple is misusing its power over App Store in order to protect its own interest. The company’s General Counsel Horacio Gutierrez has sent a letter to Apple accusing the same.
This latest episode raises serious concerns under both U.S. and EU competition law,’ Gutierrez writes in the letter. ‘It continues a troubling pattern of behavior by Apple to keep out and weaken the competitiveness of Spotify on iOS and as a rival to Apple Music, particularly when witnessed against the background of Apple’s earlier anticompetitive conduct intended at Spotify. We cannot stand by as Apple uses the App Store approval process as a weapon to harm the competitors.’
Senator Elizabeth Warren on receiving the copy of this letter raised her concern over anticompetitive practices by Apple, Amazon and Google. ‘Apple has long used its control of iOS to squash competition in music,’ says Warren.
Apple launched Apple Music in 2015. It throws shade on App Store approval process to harm its competitors in the market. Spotify, launched in 2006 and still struggling to make a profit, says that billing process on iOS has made it rub salt on their wound.
Apple’s billing system has made it mandatory for the third-party subscription apps to use iTunes as the only payment method. If the third-party apps use anything other than iTunes as a payment method, they need 30% of their overall revenue. Spotify claims that Apple takes away a large chunk of its profit margin.
Spotify charges $10 for a subscription for its users from other platforms such as Android and Windows but iOS users now have to pay $13 to compensate for Apple’s cut.
When asked about these allegations, Apple’s General Counsel Bruce Sewell says Spotify is resorting to rumors and half-truths about Apple’s service.
‘We find it worrying that you are looking for exclusions to the rules we apply to all developers and are publicly resorting to rumors and half-truths about our service,’ explains Sewell. ‘Our guidelines apply equally to all app developers, whether they are game developers, video-streaming services, e-book sellers, or digital music distributors; and regardless of whether or not they compete against Apple. We did not change our behavior or our rules when we introduced our own music streaming service or when it became a competitor. Ironically, it is now Spotify that wants things to be different by asking for preferential treatment from Apple.’
Sewell informs that even the current Spotify App is violating Apple’s guidelines.
Although Spotify is dependent on App Store for providing its service to iOS users, it is still leading the subscription music race. It can outlive Apple Music few more years. In March, it had 30 million paying subscribers while in June, Apple had only 15 million paying subscribers.