You can try to spin it any way you want, but the bottom line is Spotify is paying lower royalties. Which makes them hypocrites to call out Apple.
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Apple Says Spotify Only Pays 15% Fee on About 0.5% of Subscribers in Response to App Store Complaint
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You can try to spin it any way you want, but the bottom line is Spotify is paying lower royalties. Which makes them hypocrites to call out Apple.
The problem is that Apple is charging 30% for the first year, which is clearly too much.
They could charge Spotify 7-10% and I’m 100% sure Spotify would actually encourage all of its users to go through iOS, since it would need less infrastructure to handle payments and would carry less risk. At 30% though it’s too high. And it is in Apple’s own interest that it remains high.
The issue here is whether Apple is impeding its competitors’ growth due to this vertical integration. Apple actually has a very strong case here to say it isn’t. I’m not siding with Spotify - esp. since their iPad app is trash.
No it's not.
And I've read the entire article, I don't need selective, out of context quotes from the article that don't prove your point anyway.
The article makes it clear that Apple's argument doesn't really matter not that the 2014-2016 period for Spotify in general is irrelevant. If you want to bash the article on The Verge at least try to make an effort to interpret it correctly.
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So by your account ....
Apple setup a store to deploy apps and check the security of the code to not gather data from end users!
Apple has created the SDK for which spotify uses to create an iOS or WatchOS app.
Apple creates, distributes and helps Spotify advertise on their hardware and software store front platform.
Spotify pays NO advertisement dollars for their app on iOS platform. Spotify of course serves up their music media through their servers, yet nobody forced them to deploy on iOS or WatchOS they chose to agree to apples dev rights, and to upload their platform.
Let’s consider:
Apples R&D, manufacturing, shipping of iOS devices, and then marketing them, curation of the App Store and research analytics for developers as real costs along with loosing subscribers to Spotify and allowing them to fully compete for an ecosystem that Spotify has always won on and let’s see the costs between the two.
Seems to me spotify is getting greedy n doesn’t want real competition.
First of all:
1) Apple controls 25% of the mobile market share world wide, which is huge.
2) Apple has anti-competitive practises against competing services on their platform.
3) If Wall Mart controlled the same market share world wide, Wallmart is not allowed to disadvantage competing products over their house brands.
Apple is going to get fined as Google has been fined for this same things. I’d be very suprised if Apple does not got fined.
What do you think would happen if Google disadvantages Apple in their search engine for products that Apple competes against Google?
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And just for your perspective...
There are people like me that have been using Spotify in the Premium tier even before they bought an iPhone. Heck - Spotify is still one of the few media players that can be used in Background Mode on XBox One.
I personally just needed an iOS client - which is, what Spotify gave me - and I had a premium account way before the download of the iOS client.
Now tell me - how does this in any way justify Apple taking a cut from my money for just letting a downloadable client version sit in their App Store?
Apple don’t take a cut of your subscription because you’ve signed up outside of the iOS app.
Apple only take a cut of the subscription when you sign up via the iOS app.
Thank you for responding. You said Apple's response was "technically correct" and contained "facts". This means that nothing of what you wrote justified saying Apple's response was all lies. I understand how to mislead by telling the truth (there are "lies, damned lies, and statistics") but you can't argue Apple's statement is lies by saying what they said was "correct" and full of "facts." It's going to take clearer evidence than what you provided. If you happen to be one of Spotify's lawyers, you'll need to do much better arguing your case than what you did here. It's a challenge for Spotify to demonstrate adverse effects of Apple's policies. Spotify has continued paid user growth. They are the largest streaming service in the world (and yet they pay artists less than Apple). That's part of their challenge with this app store complaint. It's a slightly different issue but Spotify is fighting a difficult battle here. Apple's fees are not unreasonable. How might this effect an iOS-only new streaming service? Would Apple's policies prevent it from succeeding? Maybe. If that's the argument, that has to be clearly explained. My point again is that Spotify has to make clear arguments if it want's to succeed.
I like Spotify and have used it extensively in the past but currently use Apple Music because I have a number of Apple devices and it's cheaper for my family plan (I buy iTunes gift cards for 15-20% discounts but there are no discounted Spotify gift cards that work for Premium for Family).
That's a pretty good article but there is irony about Spotify complaining about "Apple's tax" ("In March, Spotify filed a complaint with the European Union’s antitrust arm saying that Apple requires it to 'pay a 30 percent tax on purchases' made through iOS.") when there are high VATs in the EU. Can I file a complaint against the EU (if I were a citizen of an EU nation) because I have to pay a tax on products purchased within the EU? It's also a little funny given the fact that Spotify had a net tax burden over the past year of 1 million € (data from here: https://investors.spotify.com/finan...l-Results-for-First-Quarter-2019/default.aspx). It's only that high because Spotify had a profitable quarter, even though they mostly operate in the red. I don't want Spotify to go out of business - they offer a great service - but some of their complaint is funny in light of general tax laws.
Picking out straight up lies about Spotify subscription numbers is "selective" and "out of context"? I did read the entire article (it's very short and lacking in any substance - not sure how you could think it is somehow an accurate description of what's going on).
Funny how The Verge ignores the heart of the matter - harm done. You can't have a case without showing harm. And with Spotify effectively getting pretty much their entire user base to sign up directly, they can't claim harm.
Further, Apple really only has one service that competes with outside services - Apple Music. So the 30% complaint doesn't apply to the entire App Store since there's no unfair competition going on. If Apple had a large number of Apps/Services that were in direct competition with third parties, then I could see there being a valid case. The EU isn't going to overturn the entire App Store model based on a single customer that didn't actually suffer any harem.
You say no harm done? I can think of several things off the top of my head.
1. All advertistment dollars paid to address the fact that they are banned from telling the use anyway in the app to subscribe outside of using Apple system.
2. All users subscribtions lost because user does not go the web and go threw that system to sign up that would of if it was in app.
3. Any loss of sign ups because the user just did not know how to do it or even know it was possible.
4. Any user that would of gone with Spotify but choose to go with Apple music because they knew how to sign up there.
Loss of sign up compared to high end Android phone users is a way to show lost sign up.
Comparing same demographics of people Android vs iOS (like social economics) and sign up Android vs iOS.
Comparing web users to iOS only users and sign up differences.
All that shows harm.
Also do note at this level and court they do not have to prove beyond a reasonable doubt of harm. The bar set for Spotify is set pretty low. They can show potential harm.
You keep saying this is the only one that is hurt but Netflix is hurt they just choose not to fight as hard plus Netflix is based is in USA so different courts. Google is harmed by Apple's policies.
Apple is being a massive ripoff for being basically a payment processor. At 5% more would be willing to play ball but the 15-30% is a massive ripoff big time as payment processors charge less than 3%.
So by your account ....
Apple setup a store to deploy apps and check the security of the code to not gather data from end users!
Apple has created the SDK for which spotify uses to create an iOS or WatchOS app.
Apple creates, distributes and helps Spotify advertise on their hardware and software store front platform.
Spotify pays NO advertisement dollars for their app on iOS platform. Spotify of course serves up their music media through their servers, yet nobody forced them to deploy on iOS or WatchOS they chose to agree to apples dev rights, and to upload their platform.
Let’s consider:
Apples R&D, manufacturing, shipping of iOS devices, and then marketing them, curation of the App Store and research analytics for developers as real costs along with loosing subscribers to Spotify and allowing them to fully compete for an ecosystem that Spotify has always won on and let’s see the costs between the two.
Seems to me spotify is getting greedy n doesn’t want real competition.
Desperate is the word for it.
It would appear that the only reason why Spotify was even able to grow was due to a lack of any real competition.
While Spotify continues to grow, the bulk of its growth comes from non-iOS strongholds which don’t earn them much money. Meanwhile, Apple has succeeded in winning over their best customers.
The App Store tax is really Spotify’s weakest point, and I look forward to Apple slowly but surely demolishing Spotify’s arguments one by one.
Huh?
What is the difference between that and Uber offering a “free” app and then having users purchase their ride through their own payment system while keeping 100% of the profits?
Why does one get to keep 100% of their profits and the other does not? It’s arbitrary.
Hmm. The same argument is stated with ANY software for macOS or Windows when you switch platforms: licenses are not transferable. Sure Spotify isn’t charging you - then again Spotify isn’t doing any lifting for managing the store front or having it compatible on several devices up to five years old (iOS) nor are they making unlimited downloads available for the latest update of their up they’ve uploaded nor are they hosting the app nor are they taking the bandwidth hit for downloads on their own servers. There is a lot more that you’re getting or all Spotify users are getting that is unseen and would add a cost which I’m sure if Spotify hosted the app would start to undercut very soon due to operating expenditures.
Complaining about a platform they’ve chosen to agree with and benefited hugely on after the fact is one thing. They’ve stayed nothing about a free net upload and download environment like old smartphone days for which they’ve prepared for (said nothing about).
Microsoft doesn’t really compete in music streaming and if they still do its peanuts/convenience not a real business their hugely focused on. We’ll see how this turns out.
True. And you never use Walmart's services to get delivery of that content. However, in order to listen to Spotify on your Apple iPhone, you continually take advantage of the ecosystem and development tools that Apple created. Apple continues to be an integral part of that delivery. The fact that Apple even allows for subscriptions, that are paid for outside of the app, is quite generous.
Honestly I hope the courts rule in favor of Spotify for this. It is absolutely not a level playing field when Apple can offer a competing music service at a 15% discount. It is screwing both customers and artists. It is also impossible to know how many non tech savvy people didn’t sign up for Spotify in the first place as it was not intuitive within the app (think grandparents). In addition, Apples treatment of Spotify regarding the Apple Watch app is completely unfair by not allowing offline playback, when they do allow it for some competing podcast and audiobook apps (Amazon’s audible and Overcast for example). The courts need to rule in favor of Spotify and bring such anti-competitive practices to light.
It still stands - compared to the premier tier it’s still less (hence why I mentioned it).
None of Apple's servers are used to stream any of the music from spotify.
If the reason for apple getting a cut because you are getting the Spotify App from apples servers, then why do lottery apps not pay a 30% cut?