Spotify Dispute: EU Commission Imposes 1.8 Billion Euro Fine on Apple

Spotify versus Apple. The European Commission has now published the result of its investigation into the Spotify dispute, which was triggered by a complaint from the music streaming service back in 2015. The EU Commission upholds the antitrust complaint, as a result of which Apple has now been ordered to pay a fine of 1.8 billion euros.

Spotify dispute: 1.8 billion euro fine against Apple

Not least because of the compulsion to use its own app store, Apple has to answer to antitrust law again and again, although the Cupertino-based company has now had to bow to the new regulations of the Digital Markets Act (DMA), which comes into force on March 7, 2024. Setapp, an alternative to Apple’s own App Store, will be launched shortly.

However, this has no impact on the Spotify dispute, which dates back several years. The audio streaming service from Sweden accused Apple of unfair competition and filed an antitrust complaint.

After a lengthy investigation, the European Commission has now come to a clear conclusion, agreeing with Spotify and imposing a fine in the billions on Apple.

The EU Commission’s press release states that Apple does not allow developers of music streaming service apps to inform users about alternatives and cheaper music subscriptions. Information on how to subscribe to such alternatives is also missing.

The prominent advertising of Apple Music, including the exclusive use of Apple’s own payment service, for which the company charges a commission, was also part of the investigation.

1.8 billion euro fine and conditions for Apple

These unfair trading conditions constitute a violation of Article 102(a) of the Treaty on the Functioning of the European Union (TFEU), according to the EU Commission. The European Commission has now imposed a fine of 1.8 billion euros on Apple for abusing its dominant market position.

The duration and gravity of the infringement were taken into account when setting the fine, but the overall level of market capitalization on the part of Apple was also decisive. It is also alleged that Apple provided false information during the administrative process.

The amount of the fine should also be seen as a deterrent. In addition, the Commission has instructed Apple to repeal the existing provisions and noted that the company should refrain from introducing similar provisions in the future.

Apple statement: “Free is not enough for Spotify”

Apple, on the other hand, responded to the ruling with a long statement that sharply criticized the European Commission’s decision and summarily blamed Spotify. It states:

‘Ironically, in the name of competition, today’s decision only cements the dominant position of a successful European company that is the undisputed leader in the digital music market.

The company accuses Spotify of conspiring with the EU: the Swedish music streaming service is said to have met with the EU Commission 65 times over the course of the eight-year-long proceedings.

According to Apple, the Spotify app has been downloaded more than 119 billion times on Apple devices, but despite this success, Spotify pays nothing to Apple as subscriptions are sold via the Spotify website and not within the app.

Spotify would therefore benefit from Apple’s technologies and ecosystem free of charge without creating any added value. Apple cites the integration of Spotify in Siri, CarPlay, Apple Watch, AirPlay, widgets and more as examples.

“But free is not enough for Spotify. The company also wants to rewrite the App Store guidelines – and in a way that gives it even more benefits,” Apple continues. Shortly before the DMA comes into force, the Commission is trying to enforce the DMA with the ruling before it becomes law. Apple has announced that it will appeal against the ruling.