Apple responds to Spotify antitrust complaint

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Apple has accused Spotify of “misleading rhetoric” in a response to Spotify’s antitrust complaint in Europe, pulling no punches as it accused Spotify of “trying to squeeze” artists, musicians and songwriters, in the same way that it was trying to “make more money off others’ work” in the App Store, pointing to Spotify’s appeal against a proposed increase to its US royalty payments.

“After using the App Store for years to dramatically grow their business, Spotify seeks to keep all the benefits of the App Store ecosystem — including the substantial revenue that they draw from the App Store’s customers — without making any contributions to that marketplace,” Apple said late on Thursday. 

In its antitrust complaint against Apple, Spotify alleged that it had behaved unlawfully and abused its App Store dominance to favour Apple Music.

Apple’s streaming service has quickly become Spotify’s biggest global rival since it launched in 2015, attracting more than 50m paying subscribers by the start of this year.

As an example of Apple’s allegedly unfair practices, Spotify cited the 30% tax that Spotify and other digital services must pay on purchases made through Apple’s payment system, including when Spotify users upgrade from Free to Premium packages.

Spotify also alleged that Apple routinely blocks Spotify’s upgrades, shutting it out from Siri and other services, and that Apple imposes other restrictions that can make it hard for Spotify to communicate with its users through the app.

The timing of Spotify’s attack could be seen as many as deliberate, coming in the same week that Apple announced an event to promote new digital media services, as well as setting the date for its annual conference for app developers in early June.

“Spotify wouldn’t be the business they are today without the App Store ecosystem, but now they’re leveraging their scale to avoid contributing to maintaining that ecosystem for the next generation of app entrepreneurs,” Apple said on Thursday.

Apple also highlighted that Spotify “left out” the fact that its fee falls to 15 per cent once a customer has been paying for more than a year. While Spotify asked to be treated in the same way as Uber or Deliveroo, Apple pointed out that only digital goods and services that rely on its in-app purchase system must pay the fee under its App Store rules.

“Apple connects Spotify to our users,” Apple said, by providing tools for creating, distributing and charging for its service, which it described as “no small undertaking”.

“Spotify is asking to keep all those benefits while also retaining 100 per cent of the revenue.”

Unsurprisingly, Spotify disputed Apple’s account on Friday,

“Every monopolist will suggest they have done nothing wrong and will argue that they have the best interests of competitors and consumers at heart.”

“We filed our complaint because Apple’s actions hurt competition and consumers, and are in clear violation of the law,”

“This is evident in Apple’s belief that Spotify’s users on iOS are Apple customers and not Spotify customers, which goes to the very heart of the issue with Apple.” 

Spotify’s Wednesday filing with the European Commission is just the latest in a series of complaints lodged with the antitrust body.

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