The European Union (EU) has officially fined Apple 1.84 billion euros, roughly the equivalent of $2 billion, for exploiting its “dominant position” in the market of music streaming.
The European Commission (EC), an executive cabinet government overseeing the European Union, claims Apple prevented other companies from advertising their streaming platforms on the app store.
Specifically, they claim that music apps had to pay Apple a 30 percent fee on each subscription they received from an Apple app store user, a cost that was then passed onto the consumer. The only way around this is if the user pays for the subscription through the developers’ websites, but Apple prevented developers from letting their users know this cheaper option was available.
Termed an “anti-steering” tactic, the EC explains that Apple also systematically prevented the developers from including links in their iOS apps to their websites for cheaper options, and prevented the developers from even emailing their new users to inform them about pricing plans.
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“As a result, millions of European music streaming users were left in the dark about all available options,” said EC Vice-President Margrethe Vestager. “Apple with its App Store currently holds a monopoly in the market for the distribution of music streaming apps on Apple devices. For music streaming developers to reach Apple users in Europe, they have to be present on Apple’s App Store. And to do so, they have to comply with the mandatory and non-negotiable terms and conditions imposed by Apple.”
In a statement provided to Reuters, Apple dismissed the decision as unsubstantiated. “It was reached despite the Commission’s failure to uncover any credible evidence of consumer harm, and ignores the realities of a market that is thriving, competitive, and growing fast,” the tech giant said. “The primary advocate for this decision — and the biggest beneficiary — is Spotify, a company based in Stockholm, Sweden. Spotify has the largest music streaming app in the world, and has met with the European Commission more than 65 times during this investigation.”
Nevertheless, Apple shares opened on Monday with a two percent drop.
This is the first time the EC has placed a deterrent fee on top of an antitrust fine, far surpassing the 500-million-euro price tag insider sources had anticipated. The antitrust fine was just 40 million euros (which the European Competition Commissioner described as a “parking ticket”), while the deterrent fee was 1.8 billion euros, equal to about 0.5 percent of Apple’s global net revenue of $383 billion.
Shane Devine is a writer covering politics, economics, and culture for Valuetainment. Follow Shane on X (Twitter).
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