EU is launching an antitrust probe into Apple’s conduct based on Spotify’s competition complaint

The European Union’s contest authorisation is launching an antitrust probe into Apple’s ship later considering Spotify’s contest complaint which alleges that Apple’s ain music-streaming service gives the iPhone maker an unfair payoff over rivals.

The Financial Times reported this morning, citing iii unnamed sources:

After considering the electrical charge in addition to surveying customers, rivals in addition to others inwards the market, the European Union contest committee has decided to launch a formal antitrust investigation into Apple’s conduct, according to iii people familiar amongst the probe.

Apple in addition to Spotify both declined to comment.

EU enforcers tin need companies to alter draw organisation practices they deem unlawful in addition to levy fines of upwardly to 10 per centum of a company’s global turnover. The investigations cause got no ready deadlines in addition to tin cause got years to resolve. However, companies tin speed upwardly the physical care for in addition to avoid fines yesteryear offering to settle the probes amongst binding promises of behavioral change.

A spokesperson for the committee has confirmed to CNBC receiving a electrical charge yesteryear Spotify, “which nosotros are assessing nether our measure procedures.”

In March, Spotify filed an official European Union compliant accusing Apple of behaving unlawfully yesteryear “tilting the playing patch to disadvantage competitors”. CEO Daniel Ek warned Spotify would heighten prices should Apple maintain to accuse its 15-30 per centum fee on App Store purchases in addition to subscriptions (the initial 30% charge per unit of measurement drops to 15% later the root twelvemonth of an annual subscription).

“If nosotros pay this tax, it would forcefulness us to artificially inflate the cost of our Premium membership good higher upwardly the cost of Apple Music,” he wrote inwards a blog post. “And to maintain our cost competitive for our customers, that isn’t something nosotros tin do.”

A lawyer who worked on Spotify’s electrical charge said that other companies had “similar concerns” simply were “too afraid to cause got on Apple”. One of them is Deezer, which echoed Spotify’s concerns. Apple responded to the accusations amongst an open letter published on its website.

“After using the App Store for years to dramatically grow their business, Spotify seeks to maintain all the benefits of the App Store ecosystem — including the substantial revenue that they describe from the App Store’s customers — without making whatsoever contributions to that marketplace,” Apple wrote.

Spotify terminal calendar month hit 100 million paid subscribers to its service, putting it good ahead of Apple Music’s 56 1000000 paid subscribers equally of Novmeber 2018. Apple’s service has been growing at a faster clip than Spotify in addition to right away has to a greater extent than paying U.S. of A. of America customers than the Swedish streaming giant.

Share this post