Apple Says Spotify Only Pays 15% Fee on About 0.5% of Subscribers in Response to App Store Complaint

[jlc1978]

Spotify doesn't run a app store, so how does this new info from apple invalidate the monopoly and anti competitive complaints? Apple still gets to use iOS notifications to show apple music ads.

Simple. First, Apple is not a monopoly. Spotify has plenty of other options to sell its product and by all accounts is selling a lot more through other channels. Spotify is just trying to bolster its case by charging more for an in app purchase, IMHO. Given the small number of paid subscribers they could just pull the app if they felt the terms were onerous.

What Apple is doing is not different than a B&M store making a profit on the sale of 3rd party goods.

 

[Rogifan]

Simple. First, Apple is not a monopoly. Spotify has plenty of other options to sell its product and by all accounts is selling a lot more through other channels. Spotify is just trying to bolster its case by charging more for an in app purchase, IMHO. Given the small number of paid subscribers they could just pull the app if they felt the terms were onerous.

What Apple is doing is not different than a B&M store making a profit on the sale of 3rd party goods.

Spotify will lose this case but I still think Apple charging 30% and 15% for digital media sales and recurring subscriptions won’t last long. If this was really about maintaining the App Store, App Store review, infrastructure costs etc. there would be no free apps. Every app would cost something. The way it is now is like Walmart saying in order to stock certain 3rd party goods Walmart will get a cut every time one of those goods is sold but other 3rd party goods it will take no cut at all.

To say if Spotify wants to sign up a customer in app they have to give Apple a cut but Uber can charge customers in app and not pay Apple a dime is ridiculous. And the only reason it’s that way is because nothing like Uber existed back in 2008/2009. Believe me if Apple could get away with taking a cut of Uber transactions they would in a heartbeat.

 

[Suckfest 9001]

Apple has overhead to provide a seamless experience just like any other company and they need to recoup it as well as make some profit. Charging fees directly at the app level makes the most sense. If that policy were banned, they would have to bake that cost it into the price of each phone, and I for one do not want that additional overhead when I don't even use Spotify (or many other of these apps).

Same overhead as any free app. The addition of more premium users doesn't impact Apple.

 

[MauiPa]

Apple also forbids Spotify and other developers from alerting users that they can sign up for a subscription or complete a purchase outside of its iOS app, and disallows Spotify from advertising deals to its customers in the app or by email, as these practices would circumvent Apple's in-app purchase system.

I assume this is the issue? just get rid of this passage ...

Except, I get emails from Spotify all the time requesting that I upgrade to premium. So this isn't accurate

 

[Suckfest 9001]

Except, running and maintaining a platform costs billions of dollars every year: App store editorial, app store reviews, server costs of delivering apps, Xcode, API development and maintenance, CloudKit, iCloud drive, push notifications, research and development, MapKit, macOS notary services, app store analytics, in app purchase servers, TestFlight services, etc...

Sure, Spotify doesn’t use every single one of those features, but Apple makes these services available to all developers to use. That’s not free.

If it was so easy to run a platform, Spotify can go fork Android.

Except Spotify has the same overhead as any free app. The addition of more premium users doesn't impact Apple, as Spotify serves those users directly.

 

[MauiPa]

Same overhead as any free app. The addition of more premium users doesn't impact Apple.

Fake news. If you subscribe via apple, you pay via Apple. ergo more cost than free apps. Why don't people just get an account via Spotify and pay through Spotify. the complaint is absurd. How could they not, you could have a Spotify account via a PC, smart tv, ......... that subscription can be applied to your iPhone or Mac account

 

[Suckfest 9001]

Not as funny as seeing people take the side of whoever is against Apple, regardless of the merits of the case.



Apple doesn't force Spotify to give them a cut. Spotify (and others like Netflix) aren't required to use IAP to sign up customers. They only have to pay a cut IF they use IAP. They are 100% free to sign up customers exclusively through their own website. They have a CHOICE and are 100% in control of that choice.

Except Apple won't allow Spotify to give the option of subscribing users outside iAP. That swiss cheese of an argument is even funnier.

Please tell me more about how my iPhone XS Max and Apple Watch S4 and my 15" MacBook Pro demonstrate my blind hatred for Apple, and once you're done with that, please go ahead and explain how my Apple Music subscription and using Apple Music as my main app shows that I'm a Spotify shill.
[doublepost=1561400968][/doublepost]

Fake news. If you subscribe via apple, you pay via Apple. ergo more cost than free apps. Why don't people just get an account via Spotify and pay through Spotify. the complaint is absurd. How could they not, you could have a Spotify account via a PC, smart tv, ......... that subscription can be applied to your iPhone or Mac account

100% agree except for the fact Apple stopped letting Spotify mention it in the app. Please explain how that's anything but anticompetitive.

 

[MauiPa]

Spotify will lose this case but I still think Apple charging 30% and 15% for digital media sales and recurring subscriptions won’t last long. If this was really about maintaining the App Store, App Store review, infrastructure costs etc. there would be no free apps. Every app would cost something. The way it is now is like Walmart saying in order to stock certain 3rd party goods Walmart will get a cut every time one of those goods is sold but other 3rd party goods it will take no cut at all.

To say if Spotify wants to sign up a customer in app they have to give Apple a cut but Uber can charge customers in app and not pay Apple a dime is ridiculous. And the only reason it’s that way is because nothing like Uber existed back in 2008/2009. Believe me if Apple could get away with taking a cut of Uber transactions they would in a heartbeat.

No, the issue is paying for subscription through Apple, or self-collection. apple does not get a dime on self collection apps. Like most Spotify accounts are set-up directly via Spotify and by-pass the fees and payment through apple altogether

 

[Rogifan]

Fake news. If you subscribe via apple, you pay via Apple. ergo more cost than free apps. Why don't people just get an account via Spotify and pay through Spotify. the complaint is absurd. How could they not, you could have a Spotify account via a PC, smart tv, ......... that subscription can be applied to your iPhone or Mac account

So the 30% and 15% is to cover credit card processing? Spotify doesn’t want to use Apple’s payment processing. They just want people to be able to sign up using the app vs the web because they know any friction inserted into the process makes it a little bit more likely someone won’t sign up. At this point though they’ve calculated keeping IAP and paying Apple 30 and 15 percent is worse than the potential customers they might not acquire by not having sign up directly in app.

 

[cfurlin]

You think that Apple would lie to the government about something that can be easily verified?

With all those exclamation points I can see you're really worked up about this.

Some people need their daily dose of outrage or they’re just not happy.

 

[Rogifan]

No, the issue is paying for subscription through Apple, or self-collection. apple does not get a dime on self collection apps. Like most Spotify accounts are set-up directly via Spotify and by-pass the fees and payment through apple altogether

But that’s only because Apple doesn’t allow any other way. Digital media apps can’t use their own payment processing. So they either use Apple’s and give Apple a cut or they become a reader app and force users to signup/pay via the web.

 

[coolfactor]

Apple deserves to collect _something_ if they:

• process credit card payments
• provide some level of customer support to Spotify users
• provide a platform to discover and keep updated the Spotify app

Is 15% of the subscription fee too much? ($9.99 subscription = $1.50 per month to Apple).

I say — No.

Is Spotify entitled to use Apple's resources (eg. servers and marketing) at absolutely no cost? — No.

Maybe Apple needs to introduce another mechanism where companies like Spotify can pay a fixed fee per year to cover Apple's costs?

 

[Suckfest 9001]

Apple deserves to collect _something_ if they:

• process credit card payments
• provide some level of customer support to Spotify users
• provide a platform to discover and keep updated the Spotify app

Is 15% of the subscription fee too much? ($9.99 subscription = $1.50 per month to Apple).

I say — No.

Is Spotify entitled to use Apple's resources (eg. servers and marketing) at absolutely no cost? — No.

Maybe Apple needs to introduce another mechanism where companies like Spotify can pay a fixed fee per year to cover Apple's costs?

All Apple has to do to make it fair is to allow Spotify to mention/link to their subscription page. Spotify couldn't care less about Apple's iTunes billing, they'd be perfectly happy getting users to sign up through their site instead if Apple hadn't forced them to take out that piece.

 

[sracer]

Except, I get emails from Spotify all the time requesting that I upgrade to premium. So this isn't accurate

receiving emails is not the same as an "in app" reminder/notification.

 

[jlc1978]

I wish it was that simple. We simply don't have anything prior to judge upon. So there is really no right or wrong in this case. A lot of people argue it like Supermarket and Walmart. Where they have their own labels, which can undercut big brand because they have no restocking fees etc. But this argument works because you have many Supermarket to choose from, and you can buy ketchup from everywhere. In technology you only have two players, Apple and Google.

Only if you want to use an app. You can stream from a web browser or web app. Apple also does not charge if you subscribe outside of the app, so Spotify would be free to do that which is what they appear to do.

Does that mean Apple should not be charging 15%, again people using the Walmart example, they will have their own cost, Staff, and also Rent, which is big part of Supermarket operational expenses. Except in Apple's case Apple is also "the" landlord.

Actually, FWIW, Walmart owns some of the land and many of the stores as well; just through a separate real estate arm.

 

[Solomani]

Because this is being filled in the EU, the next headline will read "Apple forced to do something because the EU doesn't fully understand what it was they ruled against."

Apple will lose in the EU…. because the EU regulators clearly want to "shake down" (extortion) the party with deeper pockets: Apple. That money/penalty will go to the EU regulators/agencies themselves, it will never go to any European citizen.

 

[genovelle]

Apple also forbids Spotify and other developers from alerting users that they can sign up for a subscription or complete a purchase outside of its iOS app, and disallows Spotify from advertising deals to its customers in the app or by email, as these practices would circumvent Apple's in-app purchase system.

I assume this is the issue? just get rid of this passage ...

Why should they be allowed to take customers Apple secured for them and provided access to and cut them out after the fact. Sounds like a disingenuous partner.

 

[Rogifan]

Apple deserves to collect _something_ if they:

• process credit card payments
• provide some level of customer support to Spotify users
• provide a platform to discover and keep updated the Spotify app

Is 15% of the subscription fee too much? ($9.99 subscription = $1.50 per month to Apple).

I say — No.

Is Spotify entitled to use Apple's resources (eg. servers and marketing) at absolutely no cost? — No.

Maybe Apple needs to introduce another mechanism where companies like Spotify can pay a fixed fee per year to cover Apple's costs?

Wouldn’t this apply to any app on the store? Yet most of the apps on my phone didn’t cost me anything or just a small amount to pay to get rid of ads. I think Apple even disclosed that 85% of the apps on the App Store are free. One could argue small developers benefit most from your 3rd bullet point.

 

[jlc1978]

All Apple has to do to make it fair is to allow Spotify to mention/link to their subscription page.

Why? Apple isn't stopping them from selling subscriptions outside the app, just getting a cut if they do it in app. Apple shouldn't be expected to provide a free hosting platform and make it easy to buy the service using an add on an app they host, any more than a B&M store wouldn't allow a product they sell to advertise that you can also buy it cheaper directly.

 

[Rogifan]

Why should they be allowed to take customers Apple secured for them and provided access to and cut them out after the fact. Sounds like a disingenuous partner.

How did Apple secure those customers for them? Just the mere existence of the App Store? Then why aren’t Uber and Lyft required to use Apple’s payment processing?

 

[Suckfest 9001]

Why? Apple isn't stopping them from selling subscriptions outside the app, just getting a cut if they do it in app. Apple shouldn't be expected to provide a free hosting platform and make it easy to buy the service using an add on an app they host, any more than a B&M store wouldn't allow a product they sell to advertise that you can also buy it cheaper directly.

Except B&M stores price match

 

[Rogifan]

Why? Apple isn't stopping them from selling subscriptions outside the app, just getting a cut if they do it in app. Apple shouldn't be expected to provide a free hosting platform and make it easy to buy the service using an add on an app they host, any more than a B&M store wouldn't allow a product they sell to advertise that you can also buy it cheaper directly.

Again the problem is this doesn’t apply to everything, just digital media. I can buy all manner of things in the Amazon app bypassing Apple directly. I can order an Uber or lunch from the Panera app bypassing Apple. I currently use Safari to buy all my books from Barnes & Noble cutting out Apple. Sure it would be more convenient to buy directly inside the app but if it meant the books would be 30% more expensive I wouldn’t do it. If this is about paying for app hosting then no app in the store should be free. Every app should cost something.

 

[PrasadV]

Couldn’t care less, Apple fully deserves to be dragged through the EU competition commission and fined heavily!
I don’t trust a word Apples dodgy lawyers claim either! Hell according to them Apple invented round corners and the colours black and white! Take every single thing Apples legal team says with one gigantic pinch of salt....

So, you forgot the samesung document produced in the court which proved Samesung copied iPhoned and iOS pixel to pixel to make it as close as possible without any respect for others work or courts? and Apple to be blamed here? ok... no problem - you are in the group who thinks people do work for free.

 

[falainber]

Spotify complaining about Apple being greedy whilst their entire complaint is greedy in itself? Yeah, ok. The fact that Spotify pays artists even less, drastically in the free tier, in comparison with Apple is just extra lolz as well. Spotify has been greedy from day 1.

Did you really see word "greedy" in the Spotify complaint? Also, is not Apple being generous at the Spotify expense? So, in reality it's Spotify that is generous and Apple is greedy (by misappropriating Spotify funds that could have been used to pay to artists).

 

[neuropsychguy]

Apple's response is nothing more than PR and full of absolute lies. Apple should be ashamed of themselves.

That's a major claim that requires clear evidence. What are all the lies in Apple's response? Why are they lies? What evidence do you have? Please provide citations and references.