Apple Accuses Spotify of 'Resorting to Rumors and Half-Truths', Sets Record Straight on App Rejection

[Bawstun]

Spotify's problem is that Apple increases the subscription price to $12.99 if you're using iOS to subscribe, whereas it can offer a $9.99 price point over the web. Apple won't allow them to name their own business price, essentially. Which of course is absurd. It's a crap policy - it's like saying you should pay more for Netflix just because you downloaded it through the App Store. But if you got it somewhere else, you'd get a 30% savings. Entirely unfair and unethical and everybody in here defending Apple and their response is completely wrong and should feel bad.

 

[cmaier]

Spotify's problem is that Apple increases the subscription price to $12.99 if you're using iOS to subscribe, whereas it can offer a $9.99 price point over the web. Apple won't allow them to name their own business price, essentially. Which of course is absurd. It's a crap policy - it's like saying you should pay more for Netflix just because you downloaded it through the App Store. But if you got it somewhere else, you'd get a 30% savings. Entirely unfair and unethical and everybody in here defending Apple and their response is completely wrong and should feel bad.

No, Apple doesn't set the price. Spotify chooses to charge more on the App Store because its costs of using the App Store are higher. But that's their choice.

What Spotify is demanding is that they get to use apple's storefront without obeying apple's rules. Try telling Walmart they have to sell your product by placing it on a specific shelf and see how far that gets you.

 

[lederermc]

No, Apple doesn't set the price. Spotify chooses to charge more on the App Store because its costs of using the App Store are higher. But that's their choice.

What Spotify is demanding is that they get to use apple's storefront without obeying apple's rules. Try telling Walmart they have to sell your product by placing it on a specific shelf and see how far that gets you.

[doublepost=1467483909][/doublepost]Product placement at Walmart is negotiable.

 

[RamGuy]

Spotify's problem is that Apple increases the subscription price to $12.99 if you're using iOS to subscribe, whereas it can offer a $9.99 price point over the web. Apple won't allow them to name their own business price, essentially. Which of course is absurd. It's a crap policy - it's like saying you should pay more for Netflix just because you downloaded it through the App Store. But if you got it somewhere else, you'd get a 30% savings. Entirely unfair and unethical and everybody in here defending Apple and their response is completely wrong and should feel bad.

You are sorely mistaken how this actually works. Apple does not set any prices on anything that's sold through the Apple AppStore, besides their own apps of course. But Apple do define some strict rules and guidelines to whats allowed to be soled through the AppStore and Apple has always demanded 30% of any transaction made through the AppStore.

What's happening here is that that Spotify have decided that because their cost of selling their subscription on the Apple AppStore compared to using their own payment solution through their own website is costing them 30% more. They have decided to counter this loss in profit per subscription by simply increasing the price for their service when bought through the AppStore with 30%.

This is not something Apple is forcing them to do, not by a long shot. This is simply Spotify feeling the need for increasing the price on the service through the AppStore because they want to have the same profit going through the AppStore as compared to when customer use Spotify.com.


This 30% cut has been a part of the Apple AppStore agreement since day one. The fact that Spotify are foolish enough to make a update to their app, telling people to skip paying the subscription through the AppStore and instead use Spotify.com which directly violates the Apple terms of service for publishing through the Apple AppStore just shows have greedy and stupid they have become. Did they really think that it would go by unnoticed?

And how stupid don't they look when they go crying to the press afterwards... "Hey guys. We intentionally voided Apple's terms of service when it comes to our latest updated to our Spotify app. Apple has decides to block the update, and we feel this is only due to the fact that they want to promote their own streaming service. It surely has nothing to do with the fact that we are blatantly voiding their terms of services. We promise."



If Spotify does not comply with the terms of services, they are free to simply pull the app completely and no longer us the Apple AppStore for publishing and selling their app and service. But they would never do that as that will kill off almost half of their customer base and make them go bankrupt in no time.

They are really trying to eat the hand that's feeding them. Where would Spotify be today if it wasn't for the Apple AppStore to begin with? It was the launch of iOS through the AppStore that made the whole company...

 

[tjleonard]

Spotify's problem is that Apple increases the subscription price to $12.99 if you're using iOS to subscribe, whereas it can offer a $9.99 price point over the web. Apple won't allow them to name their own business price, essentially. Which of course is absurd. It's a crap policy - it's like saying you should pay more for Netflix just because you downloaded it through the App Store. But if you got it somewhere else, you'd get a 30% savings. Entirely unfair and unethical and everybody in here defending Apple and their response is completely wrong and should feel bad.

My point is they created, maintain, and own that App Store...they deliver a service for developers, and should make money on it. Google doesn't give free advertising...and lastly, how many people really do not realize Spotify is only 9.99 on their site (it's actually 3 months for .99). If someone doesn't realize that, theyre downloading Spotify for music and want convenience or they just don't care about the $3.

I'm surprised I haven't seen a post complaining that Apple Music comes pre-installed and that's not fair - they should pre-install Spotify.

 

[Yuniverse]

All developers other than the ones called Apple, is what he meant to say.

Well, I guess Apple could pay Apple 30% of their Apple Music subscription profit, if you rather want.

 

[John Mcgregor]

My point is they created, maintain, and own that App Store...they deliver a service for developers, and should make money on it. Google doesn't give free advertising...and lastly, how many people really do not realize Spotify is only 9.99 on their site (it's actually 3 months for .99). If someone doesn't realize that, theyre downloading Spotify for music and want convenience or they just don't care about the $3.

I'm surprised I haven't seen a post complaining that Apple Music comes pre-installed and that's not fair - they should pre-install Spotify.

It's all about making Spotifys incompetence and inability to make profit Apples fault.

 

[blkjedi954]

Yeah right, "we firmly adhere to the principle of treating all developers fairly and equitably", all except themselves. Which is their whole point.

Us users have paid plenty for Apple's hard work (Check Apple's profit on iOS devices), stop ****ing us users over by forcing other app providers out by using unfair competition.

The rules are the same for all developers. If you don't like it then LEAVE!! Spotify wants special treatment, so f*** them!
[doublepost=1467487941][/doublepost]

My point is they created, maintain, and own that App Store...they deliver a service for developers, and should make money on it. Google doesn't give free advertising...and lastly, how many people really do not realize Spotify is only 9.99 on their site (it's actually 3 months for .99). If someone doesn't realize that, theyre downloading Spotify for music and want convenience or they just don't care about the $3.

I'm surprised I haven't seen a post complaining that Apple Music comes pre-installed and that's not fair - they should pre-install Spotify.

Apple's phone, Apple's App Store and so they can pre-install their own app on their own phone. I don't see the problem or your point. Again if you don't like it go elsewhere. Problem solved!
[doublepost=1467488410][/doublepost]

Spotify's problem is that Apple increases the subscription price to $12.99 if you're using iOS to subscribe, whereas it can offer a $9.99 price point over the web. Apple won't allow them to name their own business price, essentially. Which of course is absurd. It's a crap policy - it's like saying you should pay more for Netflix just because you downloaded it through the App Store. But if you got it somewhere else, you'd get a 30% savings. Entirely unfair and unethical and everybody in here defending Apple and their response is completely wrong and should feel bad.

Apple devices have crossed 1 billion active devices. That kind of landscape is extremely beneficial to Spotify and somehow they're trying to SCAM Apple and then run to the press!! I would suggest to Spotify to open their own App Store that reaches billions and sell their own phone if they don't like that Apple Music is on the hardware and then a fair argument can be made. Otherwise **** and enjoy the gross amount of riches you enjoy off of Apple's back!!

 

[Michael Goff]

Well, I guess Apple could pay Apple 30% of their Apple Music subscription profit, if you rather want.

Apple could do one better. What if they gave 100% of their profit to Apple? :O

 

[sudo1996]

Just curious, how so?

It sneakily opens and logs in in the background. Not like it's doing any damage, but it shouldn't be opening itself.
[doublepost=1467492421][/doublepost]

We're going to go a bit afield here but I've had the opposite experience. I started out back in the day with MythTV, conceptually it was great but it was a pain trying to support relatively recent hardware given the lack of Linux driver support. Eventually I decided that wasn't worth it and moved to Windows Media Center. I bought cases that looked like they belonged in an AV cabinet (not a Dell tower sitting next to the entertainment center) and all components and cooling for silence; basically this wasn't just toying around with the feature for a few days, I gave it a good go. It worked but the experience was still less than ideal. I liked the flexibility but user experience was subpar compared with DirectTV set top boxes and Tivo. There was still a fair bit of tinkering that had to take place with those setups and I couldn't just put the remote in the hands of a house guest without providing a tutorial. I moved to AppleTV with the 2nd generation and haven't looked back since. The "it just works" trope really holds true for AppleTV in comparison to media PCs. It's solid, it's intuitive, it provides everything I need. I really feel appliances like this, ChromeCast devices, and FireSticks (or embedded equivalents) are the future for television, not repurposed computers.

Well, the bolded part is your problem. Our PCs just run regular Windows 7 and have VLC and whatever installed. Everybody knows how to use that.

Problem with our Apple TV is all the setup to get services working. There's even setup to get the iPhone remote app working (cause nobody wants to use the four-button remote to enter text, what a pain). I always have to help my parents deal with it. I usually just stream my Mac to the Apple TV with AirPlay. That's the one great feature it has.

 

[Bawstun]

So ya'll think Apple should be taking 30% of subscriptions? Really?

 

[John Mcgregor]

So ya'll think Apple should be taking 30% of subscriptions? Really?

Under new rules it will be 15% and to answer your question - YES.

 

[Michael Scrip]

Under new rules it will be 15% and to answer your question - YES.

Isn't it 30% first year then 15% each subsequent year?

And if 15% is Apple's new "acceptable" cut of subscriptions... why are they taking DOUBLE that the first year?

 

[John Mcgregor]

Isn't it 30% first year then 15% each subsequent year?

And if 15% is Apple's new "acceptable" cut of subscriptions... why are they taking DOUBLE that the first year?

Yeah, my bad, but still after a year it's going to be 15% and to answer your second questions it's because DOUBLE is more.

 

[wovel]

No, what Apple is doing is asking for 30% on your electricity bill from your power company, because you downloaded an app on Apple store. basically if you sign up using an app, apple wants 30% of what-ever for providing nothing else than the initial download. And you can't add a signup here in your app.

So they should make nothing? So every app will be free and have a signup feature to activate it. I am sure you believe that is fair, but Apple is not a charity to support developers poor business models,
[doublepost=1467494745][/doublepost]

That's what this all boils down to. How much of Spotify's subscriber base is attributable to iOS? I'm still not sure Apple should be taking a cut of a recurring fee especially when they're not providing any service outside of credit card billing (which Spotify would do themselves in the app if they were allowed).

But, then Apple would never make anything.
[doublepost=1467495039][/doublepost]

Back in the early days all apps were not required to only use the Apple payment system. I left iOS for Android when Apple implemented that policy. On Android my Kindle app actually has a store instead of being crippled by the device overlord who made my phone. Apple could at least not force developers to use their payment system, that is the real problem here. This is why the app model as envisioned by Apple sucks compared to the open web model and why I, a longtime Mac user, do not use an iPhone.

I would prefer being able to buy kindle books in the App too. Apple could come up with a plan to charge companies per download in order to allow them to use their own purchase mechanism. The problem is it would be hard to manage. I suppose they could require a significant upfront payment per app to get into the per download program.

 

[cmaier]

Isn't it 30% first year then 15% each subsequent year?

And if 15% is Apple's new "acceptable" cut of subscriptions... why are they taking DOUBLE that the first year?

Because the theory is that apple brought you that customer at first. And you held onto the customer by making a decent app. So Apple is rewarding developers for making apps that customers actually like to use. It incentivizes developers to make sustainable apps because if they can get customers to resubscribe they get a bigger cut.

I wouldn't be surprised to see Apple tweaking the formula over time.

The point of the subscription cut is not just to reimburse apple's costs. It's to reward Apple for introducing you to valuable customers. It's like a finders fee.

 

[wovel]

Spotify's problem is that Apple increases the subscription price to $12.99 if you're using iOS to subscribe, whereas it can offer a $9.99 price point over the web. Apple won't allow them to name their own business price, essentially. Which of course is absurd. It's a crap policy - it's like saying you should pay more for Netflix just because you downloaded it through the App Store. But if you got it somewhere else, you'd get a 30% savings. Entirely unfair and unethical and everybody in here defending Apple and their response is completely wrong and should feel bad.

Apple allows them to charge whatever they heck they want to.

 

[countryside]

Sewell's letter to Spotify ends with some clarification on why Spotify's app was rejected on May 26. Spotify replaced its in-app subscription purchase options with an account sign-up feature Apple says was "clearly intended to circumvent Apple's in-app purchase rules."

I may be restating something (not sure), but is this not what Amazon Instant Video does? You can only buy videos through the web.

 

[wovel]

Apple Music should be spun off as a subsidiary company, and they should be able to demonstrate that Apple Music is only receiving 70 - 85% of the subscription revenue, with the rest going to the store, in line with every other App developer.

Apple Music should not be pre loaded on to any Apple device, and it should be up to consumers to download it, with equal opportunity for consumers to find and download competitors.

Otherwise, Apple is guilty of unfair competition. And iPhones are big enough selling devices that this should be an issue taken seriously by the authorities.

Come on Apple - *you* demonstrate that you are skimming off your own subscription revenue, and can still afford to pay artists / have content on the same basis that you have required for competitors.

Or, better still, for subscriptions, charge a "flat fee" to a developer when a subscription is taken out, and then subsequently only substract a reasonable amount comparable to a website using a regular payments processor.

Apple has a relatively small market share. You are trying to use language from the Mivrosoft case without acknowledging that the cornerstone of the case against Microsoft was their 90%+ market share.
[doublepost=1467495404][/doublepost]

I may be restating something (not sure), but is this not what Amazon Instant Video does? You can only buy videos through the web.

There is nothing wrong with that. You just can't link to or advertise that in the App.

 

[Bawstun]

Under new rules it will be 15% and to answer your question - YES.

Why? What service is Apple providing other than the initial, FREE download of the app? Spotify's servers are hosting the content, providing the bandwidth. Yet Apple should receive 30%, 15%, whatever it may be - for life? Forever? Why? On what basis? It doesn't make sense.

 

[John Mcgregor]

Why? What service is Apple providing other than the initial, FREE download of the app? Spotify's servers are hosting the content, providing the bandwidth. Yet Apple should receive 30%, 15%, whatever it may be - for life? Forever? Why? On what basis? It doesn't make sense.

Listen, pal, if you and others have comprehension problems it's your problem.

 

[Jax44]

It

I addressed updates.

Free apps get updates. Paid apps get updates. Subscription apps get updates.

Updates are a common thing across all apps in the Apple Store.

But I can't imagine updates are a big part of the $4 a month Apple gets from iOS-subscribed Spotify users.

Hell... Apple will let a free flashlight app get a dozen updates a year.

I guess the $99 a year developer fee covers that... which is another thing all apps have in common... including Spotify!

Its 3 dollars a month.

 

[Internet Enzyme]

All developers other than the ones called Apple, is what he meant to say.

So you want Apple to take a 30% cut of their own apps?

 

[0098386]

It's Apples store... period. Like it or lump it, it's only fair for Apple to be able to sell what they want and put whatever policy they want into place. Would you like someone to come into a store you opened, your business, and tell you that you not only HAD to sell a product, but you had to sell it for x amount? That's absolutely criminal and it's why Apple is clearly in the right. If Spotify doesn't like it, they can take it off the app store and become Android exclusive.

What do you make about Apple trying to make as much money as they can, by selling to the UK from Ireland to save on taxes? But still charge the same price, therefore pocketing the difference. If Spotify shouldn't do what they're doing, should Apple?
[doublepost=1467499585][/doublepost]

Say you wrote a software package that you sold on the web for $29.

You want the same profit, but you want to sell it at Walmart. Walmart takes a 35% cut. Your software must cost around $49 at Walmart to give you the same profits.

Would Walmart have an issue with your software when someone opened the box there was a note that asked you to 'return this to Walmart - save $20 - and buy it over the web for $29'.

This is exactly what Spotify is doing.

Lots of companies do this. It's how gift codes for games work. Buy an empty box with a code, put the code in a service like Steam, download the game on Steams servers, using Steameworks network features and they didn't make a penny.

 

[Apple4everr]

No, what Apple is doing is asking for 30% on your electricity bill from your power company, because you downloaded an app on Apple store. basically if you sign up using an app, apple wants 30% of what-ever for providing nothing else than the initial download. And you can't add a signup here in your app.

What about updates to the app?
[doublepost=1467500716][/doublepost]

That logic is incorrect... because it is not black and white as you put it nor Apple is really re-selling anything.

Apple charges every developer for having their apps in the App Store, and such charge lasts for a year. That is the 'fee' to 'sell' apps with Apple.
Then comes the subscription model for which Apple charges that 30% (15%) percentage. Such fee comes after using Apple's services for the subscription model, but developers are free, and should otherwise Apple would be likely charge for becoming a monopoly, to redirect to their webpages and such.
Spotify is not stupid and does the clever thing: pay Apple for having apps, and try to avoid any subscription thru the App Store.

Obviously, if Spotify sells the subscription directly, they answer for it, not Apple. Apple can only answer for the download of the app.

Apple just wants to guarantee some money, which is fair for me as an investor of Apple, but it is not fair to force developers to give Apple always part of their profit if they can find a solution otherwise as I said, Apple becomes a monopoly.
If Apple wants more cash... simple, increase the fee per year, or price according to number of downloads... I'm sure the number of useless apps in App Store would go down and sadly, Apple would not be able to brag about numbers ... oh ****!

I totally see where you are coming from here, but all in app purchases are always done through Apple, otherwise they are breaking policy. If Spotify did this then others could do this which is against the rules and under valuing Apple. I would suspect other platforms do this also, I'm sure if it was possible Netflix and other companies could of done this a long time ago