The European Commission has fined Apple over €1.8 billion for abusing its dominant position on the market for the distribution of music streaming apps to iPhone and iPad users (‘iOS users’) through its App Store. In particular, the Commission found that Apple applied restrictions on app developers preventing them from informing iOS users about alternative and cheaper music subscription services available outside of the app (‘anti-steering provisions’). This is illegal under EU antitrust rules.
And Apple released a letter that sounds petty and greedy.
Apple’s answer is fair. IF THERE WAS A WAY FOR SPOTIFY TO BE DOWNLOADED WITHOUT THE APP STORE
Either that or just don’t directly compete with them. Without Apple Music no one would have complained about it.
But you can’t establish a monopoly and leverage it to charge your direct competitors a high fee.
To be fair, Apple’s position in the digital music market predates all of the streaming apps. They may not have gone all in on Apple Music until after Spotify started taking off, but when it came to music, Apple devices were synonymous with them for a very long time.
The problem is they created a marketplace with the App Store, allowed competition in, and for way too long we have all kind of collectively accepted the fact that because it’s their platform there allowed to have special privileges over everyone else on it.
With the EU is doing is recognizing that these devices are not niche, they’re not game consoles, they are devices that every single person has, and this is a marketplace that every person is active in. It is far too large for Apple to be allowed to have that kind of privilege.
It has nothing to do with what’s fair to Apple because regulating capitalism properly should not be about fairness to all parties equally. It should be about balancing the scales and leveling the playing field.
To be honest: I am not so worried about the app store – the majority doesnt care anyways. Its in my opinion far more important that Apple and Google aren’t able to leverage their monopoly into other areas, similar how Microsoft did so with Windows and Internet explorer.
Either ditch iMessage Apple Music, apple TV, etc completly or force apple to give their competitors an equal paying field, meaning no costs to use the app store, no default App and no free promotion.
How very much like a gatekeeper to their users their argument is.
“Their” is the keyword here, they think they own the users
Despite that success, and the App Store’s role in making it possible, Spotify pays Apple nothing.
That’s because Spotify doesn’t owe you anything. If I release a piece of software for Apple, Android, Linux, Windows, etc., I don’t owe these OSes anything for that. Apple makes plenty of money selling hardware, that’s good enough for them.
These delusional bastards really need a few slaps around their heads to get this concept to sink in.
I can see an argument for owing something for hosting the app in the App Store, but certainly not 30% of what every user pays or whatever ridiculous amount Apple charges. Price it like hosting a file on S3, perhaps.
Perhaps! But only if they allowed third party app stores. Because as it stands right now, they’re basically inventing a cost that they pass on to developers, and then rewarding themselves handsomely for the cost that they would have never needed to pay if they allowed others to compete in this area. It’s still a tactic they could not get away with if they were not a monopoly.
Hell nah. They cannot be the sole gatekeepers, alternative app stores that are outside of Apple’s control need to exist.
You already pay to host your app in the app store.
And the thing is, that if the app is so popular, it gets installed a lot. Which means it only improves their devices.
Apple and app developers are a symbiotic relationship. Both need each other in order to function. Yet Apple is consistently taking a bigger piece than they should.
Damn that’s petty. They’re like a 5 year old child that got their toy taken from them
They’re used to being treated like God’s special little tech company here in the states, so of course they’re going to throw a fucking tantrum when faced with a regulatory body that actually treats them as they should be treated.
“Mah, but I helped spotify! Wah”
That’s a
paddlinanti-trust forced breakup!The beatings will continue until
moraleanti-consumer practices improve.
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They’re getting punished for keeping the users in a golden cage, and they are mad that they might have to give some of that power away. You can tell by the fact that not a single paragraph actually addresses the reason for the fine. The EU doesn’t give a damn how many times you flew engineers to Stockholm, this is about the conditions in which iOS operates that hurt both developers and users. But we already knew that Apple doesn’t give a fly about users, it’s money and nothing else for them. “Spotify doesn’t pay Apple” oh cry me a river.
Despite that success, and the App Store’s role in making it possible, Spotify pays Apple nothing. That’s because Spotify — like many developers on the App Store — made a choice. Instead of selling subscriptions in their app, they sell them on their website. And Apple doesn’t collect a commission on those purchases.
Oh noooooo, Apple is only making most of the money, instead of all the money 😭
Eat shit and die, Apple
It’s as if Ford wanted a dividend of all contractors revenue that use a F150.
Good metaphor, and their argument is “but we are also paying the gasoline”. Still sounds like slavery with extra steps.
And the devs are already paying $100/year for said fuel.
And it’s so utterly ignorant of WHY the fine was issued. This isn’t about a competitors market position, it’s about Apple using its own dominant market position to push its own service. Using a monopoly to create another monopoly is anti-competitive.
I am wondering if it’s really true, that Spotify pays nothing to Apple. If my information is correct every app provider needs to have at least one active Apple Developer subscription (in the case of Spotify there is probably far more than just one account involved). If it is true that Spotify pays nothing to Apple the only possibility is that Apple invited them to bring their app to iOS and granted them free access.
I know 99 USD is not what Apple is after, but it seems dishonest to not disclose this.
They’re just bitter that Spotify is leading the market and not Apple Music and they crybaby because of that. They’ve been bullying Spotify from the beginning and there has been bad blood on both sides for years. Apple has not made it easy for Spotify, why would Spotify give them any more money? They could have worked together, allowing HomePod and Siri to control Spotify and other cross integrations then that would have maybe been a reason to share revenue. But that’s kinda like The Little Red Hen here.
That’s on Spotify, HomePods have been able to stream from other music services for years: https://screenrant.com/apple-homepod-supported-music-services-how-many/
It’s very much not on Spotify. It supports services apple decided aren’t competing with Apple Music. Look at all the things missing, as your article points out.
It’s crazy how much bullshit Apple can pull, and even semi educated people will come to their defense blaming other people for apples failings.
It supports services apple decided aren’t competing with Apple Music.
So, Apple’s in the wrong because Spotify didn’t add the Siri music API?
In 2020, Apple did a HomePod Siri music API, and some services, such as Pandora, have adopted it.
Unfortunately, Spotify, the biggest music streaming service, has still not implemented thishttps://9to5mac.com/2023/09/21/ios-17-play-spotify-music-on-homepod/
It’s worth mentioning Apple has released a new API for music streaming apps allowing them to be controlled by Siri through a HomePod. However, Spotify, for whatever reason, has refused to implement the software into its app on iOS.
Like, I get it: the internet has a hate boner for Apple, and in a lot cases it’s justified. But it’s 100% on Spotify for this one.
And coincidentally YouTube, Spotify, and Amazon Music, all of Apple Musics competition, just all happened to not implement this? All of Apples competition just decided to not add a pretty critical function to the people of that ecosystem? When they all do it in Google’s?
Yeah, I don’t buy that. At all. Sure the API might be there, but you know who gatekeeps those APIs? Apple. This smells a lot more like Apples fued with Google over turn by turn directions bullshit. Especially when we can see how blatantly hostile to Spotify Apple is willing to be.
It seems a lot more likely that Apple is holding that API over their heads and refusing to allow access to it, than it does that all their Apple Music competition just happens to have all conveniently forgotten to implement a pretty core feature in Apple’s ecosystem, while remembering to do it in Googles.
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Wait, you still can’t use HomePod/Siri to control Spotify? How the fuck does this company continue to exist? Why do people put up with their fucking garbage?
The only service available on HomePod to voice command is AppleMusic. For Spotify, you can AirPlay from your phone’s app like a Bluetooth speaker but you can select a song by voice. Only play pause and volume and only when you have your phone available for that.
Yeah, that’s really really fucking stupid.
I mean, in the sense of billions of dollars, having a few developer accounts is nothing. From apples side, they’re making it sound like Spotify and others are pissed they can’t charge users directly through apples apk store without paying a commission. That would be something to collapse the apple store, steam, and Google play store, if everyone just started going around helping to pay for the platform they want to sell on.
It reads like a child throwing a temper tantrum…
Doesn’t it‽ it’s nuts how bad it sounds.
Nice interrobang!
I made a keyboard shortcut on my phone to type ‽ when I type ?!
… so that Apple fans can identify with it.
Under the App Store’s reader rule, Spotify can also include a link in their app to a webpage where users can create or manage an account.
Instead, Spotify wants to bend the rules in their favor by embedding subscription prices in their app without using the App Store’s In-App Purchase system.
I’m confused now. What is a “reader app”?
Spotify wants to make subscriptions an app functionality and Apple restricts that to it’s own payment system - and the alternative they provide is external websites?
Why the heck is it called a “reader rule” and “reader app”?
IIRC it’s because it comes from before when Apple was sued over charging 25-30% of all eBooks sales while pushing iBooks.
It was a while ago though so hard to find good sources now.
I’m confused now. What is a “reader app”?
This is some of Apple’s own terminology. It applies to any application who’s main purpose is to serve up audial, visual or text-based media.
Apple allows these apps to access existing accounts via apps but not create new ones.
That was a very funny joke apple made!
😡
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MS and Google are also continously fined billions by the EU over anti competitve and anti trust practices and, so they don’t get particularly preferential treatment.
The issue here is that Apple only allows devs to let users sign up for their service through Apple. Apple also demands 30% of the subscription fee when doing this. They don’t allow a developer to have a button in the app that allows to sign up through their website, or to mention that you can sign up through a website.
So the devs only have two options aside from not having an iOS app: Eat the cost and lose 30% of income to Apple, for who it’s basically free money. Or charge the extra cost over the normal price to the user.
The EU has rules against this and to do business there you need to comply with those rules. Multi billion companies basically ignore those rules until they get fined, which in most cases is just considered cost of operation. After which they may or may not continue the practice if the fine is lower than what they’d lose by stopping.
Which is why it’s better for fines to be expressed as percentages of revenue of the company. Not raw amounts. That way it truly hurts their bottom line and makes them listen and comply.
I mean, that is what happened here – they looked at market cap and yearly revenue to determine the fine amount. I agree with you for like speeding tickets which need to have their fines pre-listed, but for stuff like this a commission deciding the fine is exactly what you want. They could have gone higher ofc but the higher you make the punitive damages the higher the chances of an appeal working.
The issue here is that Apple only allows devs to let users sign up for their service through Apple. Apple also demands 30% of the subscription fee when doing this. They don’t allow a developer to have a button in the app that allows to sign up through their website, or to mention that you can sign up through a website.
“Reader” apps like Spotify can have a link to sign up on their website. There are more rules around than there maybe should be, but it’s allowed, and Apple’s letter says Spotify chooses not to do it.
Yeah, because that’s basically irrelevant. Their problem is about where payment is made and how ridiculous it is to have users have to set up subscriptions on the web. Having them sign up there doesn’t help that problem at all. It’s just Apple fishing for more sympathy.
After which they may or may not continue the practice if the fine is lower than what they’d lose by stopping.
No they’re definitely stopping no company can tank 10% of yearly world revenue, every year.
The question isn’t whether the fines curb behaviour once imposed, but if they’re sufficient deterrence. Dunno whether starting to jail people is actually the best option, easy to get fall guys if you buy them golden parachutes. How about forced share dilution to the benefit of the EU budget: Offend often and hard enough and you’ll get right-out expropriated. That’s how you hurt shareholders, they all have a joint interest in it not happening (whether small fish or big shark) and I don’t think Apple is in the mood to get in trouble with Vanguard Group.
The stock impact is there, but most of it seems to be due to cessation of illegal behaviour (less ROI), not the impact on assets. It’s indeed priced in.
Seeing horrible actors like apple getting fined gives me a nice hit of dopamine.
1.8 billion is around 2% of their last year’s net income. At least it’s a bit better than the insignificant wristslaps companies tend to get.
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True but it’s nice to even see numbers like this thrown out at all nowadays, especially at Apple.
Apple doesn’t often win appeals for EU fines
Global net income, yes. But it is 5% of the income from the EU. As much as I dislike Apple, the fine seems to be reasonable. I do want to see it bumped up if they keep on with their horseplay.
Even though the Commission has fined the company concerned, damages may be awarded by national courts without being reduced on account of the Commission fine.
So if/after Apple’s appeal is declined, Spotify - the driving force of this EU investigation - can sue Apple for damages with additional cost to Apple.
Not just Spotify. If I’m reading this judgement correctly, any developer who was materially impacted by these anti-steering provisions can sue Apple. This could be the beginning of an unprecedented wave of legal action against Apple in Europe. The tricky part is proving damages.
Yes. I singled out Spotify because they were the driving force on the EU investigation, and are big enough to invest into it. But like you say, it’s open to anyone.
For a middle class person, that’s equivalent of being sued for €1000, with a good chance of getting away with €100 even when losing. When will fines for big multinationals ever be adequate?
According to this, the fine includes a punitive damage:
Vestager said that the lump sum of €1.8 billion had been added as a deterrent since the basic amount of the fine, which she compared to a “parking ticket,” would have been quite small.
The total fine of €1.84 billion amounts to 0.5% of Apple’s worldwide turnover, according to Vestager.
Still not enough in my opinion, but hopefully if this sticks, future damage awards will be even higher. In any case, there will be a lot more fines and regulations coming down on Apple into the future (thanks in large part to the DMA), so even though this is just a single instance, they will hopefully add up pretty significantly in the coming years.
$1.8B is quite a chunk, and the EU is not shy about levying further fines if the behaviour continues.
It’s less than 0.5% of their annual global revenue. It’s nothing for a company like Apple.
It’s not company threatening, that’s for sure. But that’s big enough to show up on their annual report, and pull their profit margin down a point or two. That is very much enough to get their attention.
Based on Statista, Apple profit from EU was 36B in 2023. The fine in this case amounts to 5% of their profit from the region. This is something that will impact the company’s decisions.
Or they will fund more infrastructure development in the EU. It’s still just March.
While I do agree that the fine could be higher, this is not like a US regulatory lawsuit. In the EU, fines have to be paid immediately, and Apple can appeal if it wants and may receive some of the money it paid back. Apple doesn’t get to drag it out, and there are no out of court settlements that usually get the fine amount down.
RIP El Risitas. 😭
So doesn’t Spotify pay them the 100 dollars a year to be a developer? So Apple says they get nothing for from Spotify for developing the platform and tools, but they’re outright lying. And if the 100 isn’t enough increase the price.
Apple just seems like a crying baby in this letter.
$100 top Apple is literally nothing. So are they technically lying? Yes. But in all actuality $100 means nothing to them.
There’s a LOT to complain about Apple, but this is just semantics.
It’s very indicative of the culture though. That people pay hundreds of dollars a year just for the privilege of using their products is taken for granted.
In case anyone is wondering where the money is going: The EU budget. The EU doesn’t really get to keep it though because membership fees will be lowered by that amount next year so the actual windfall goes to member state budgets.
Fair enough.
EU, I belive in you!
Apple have been getting so many giant fines that it makes me think the EU have really just found their own way of taxing them. Which I’m in favour of.
Good guy EU!
Nice to see a reasonably sized fine. In the US it would be like 5 million and they’d spend 10 times that fighting it in court and still not affect their profits for the month.
It’s only reasonable if they earned 1.8 billion or less from it.
Otherwise they’ll just do it again.
Not necessarily, it could be that if they put the work into something else instead they would’ve made more when you account for the fine, so it could still not be worth it compared to alternatives.
Good.
Apple abusing its monopoly? Well I’d never!
