Tech giant Apple has been fined 1.8 billion euros (£1.5 billion) by regulators in Europe for not allowing music streaming apps like Spotify to tell customers they can subscribe for cheaper if they do not use Apple’s App Store.
The European Commission said that Apple had abused its dominant position in the market for distributing music streaming apps, and had broken EU antitrust rules in the process. Apple said it would appeal the decision.
The iPhone-maker said: “The decision 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.”
Swedish music giant Spotify filed a complaint to the EU in 2019 which claimed that Apple limits choice and competition by charging a 30% fee on purchases made through the App Store.
Spotify called this an unfair “tax” which benefits Apple Music, the tech giant’s own music platform which does not get charged the same fees.
Spotify also said that it is not allowed to tell customers there are cheaper ways to subscribe outside the App Store.
Apple said that it had a “key role supporting Spotify’s success” over the years.
“We’ve even flown our engineers to Stockholm to help Spotify’s teams in person,” it said.
But the European Commission appeared to agree with Spotify on Monday saying: “Apple bans music streaming app developers from fully informing iOS users about alternative and cheaper music subscription services available outside of the app and from providing any instructions about how to subscribe to such offers.”
This could “negatively affect the interests of iOS users,” who will not be able to make informed decisions and may paid “significantly higher prices for music streaming subscriptions”.
Competition commissioner Margrethe Vestager said: “For a decade, Apple abused its dominant position in the market for the distribution of music streaming apps through the App Store.
“They did so by restricting developers from informing consumers about alternative, cheaper music services available outside of the Apple ecosystem.
“This is illegal under EU antitrust rules, so today we have fined Apple over 1.8 billion euros.”
Apple said: “Apple has been a part of Europe for over 40 years, and today, we support more than 2.5 million jobs across the continent.
“We’ve helped markets thrive, promoting competition and innovation at every turn — and the App Store is an important part of that story.
“So while we respect the European Commission, the facts simply don’t support this decision. And as a result, Apple will appeal.”