Congress Reportedly Asks Spotify for Information on Apple's Alleged Anticompetitive Behavior

[realtuner]

Yep. Apple could end most or all of this antitrust stuff today if they’d just allow apps to use their own payment systems for digital goods/services.

And as soon as customers have their ID/credit card numbers stolen who do you think will get blamed for it? I guarantee you Apple will be found at fault because they allowed an unscrupulous App into The App Store without proper vetting.

If Apps could use their own payment system then all Apps would suddenly become free and everyone would try to collect direct from the customer. So now I'd need to provide my credit card details to dozens of companies instead of only to Apple. No way I'm going to expose my information to that many entities.

With Apple now getting zero revenue from The App Store (because everyone decided to collect directly) who pays for the costs to operate it? Should Apple then charge developers $999 a year instead for the privilege of getting their Apps into The App Store? Perhaps they add on another $299 each time you submit an App to cover their costs for vetting? Or maybe send developers a bill for all the downloads their App got?

I see lots of whining about App Store fees, but nobody offering up any alternative solutions.

 

[smaffei]

I am pretty sure their developers are able to make an app without using “Apple’s frameworks”... the only reason they do it (and most Devs do it) is because they have no other option.

Ah, there. Proof that you have no idea what you're talking about. You can't make an app without using Apple's frameworks.

 

[Glideslope]

I sense another Dinner Event between Tim Apple and the President.

 

[zorinlynx]

Why should Uber be exempt from the 30 percent fee?

Exactly. Spotify does not use Apple resources to provide its service outside of the initial App Store download of the app itself, and I don't think providing that download is worth 30% from all their customers on the platform.

 

[macfacts]

Spotify wants all the benefits of being on the most lucrative mobile platform without having to pay for it.

Apple uses loopholes to reduce how much tax they pay, why can't Spotify use "loopholes" to pay less apple tax?

 

[zorinlynx]

If they don’t like what Apple is doing, then they have every right to pull their app from the store. They are not being forced to do anything. If they think the iOS ecosystem is helping their business, they they can pay like everyone else.

The problem is there is no other place to install apps on iOS devices than the Apple App Store. If there were an alternative store, that would be a different story. But the fact that Apple only allows distribution through their store AND insists on 30% cut on all billing means the app maker doesn't have alternatives.

 

[realtuner]

Apple uses loopholes to reduce how much tax they pay, why can't Spotify use "loopholes" to pay less apple tax?

The real question is why are you trying to deflect this thread away from Spotify to taxes instead?

 

[carterx]

But in all seriousnessI use Spotify and prefer it over Apple but I do wish for more integration like-the ability to download music to my Apple Watch. I can agree that the 30% is a lot but if you want to utilize Apple Platform you need to pay. On the other side of that Apple has full control over what apps users install on iOS and theres no other App Store to install from so it keeps your options limited!

 

[luisfrocha]

Think of the iPhone as if it were a mall. There’s an iPhone Mall and an Android Mall and a few other less popular malls. I personally prefer visiting the iPhone Mall because (in my opinion) it’s safer, I like the products it offers more than at other malls.
Perhaps it’s more expensive just to visit the iPhone Mall than it is to visit the Android Mall, because Android Mall doesn’t charge as much to visit it (I’m talking about phone prices here). However, when it comes to being able to sell at each mall, they all charge the merchant a small percentage of your sales, instead of a fixed fee, to be able to sell at each respective mall.
The argument here, though, is that Spotify (and others) wants to be able to just walk in to each mall and not have to pay to sell, kind of like setting up a stand or taking over a space anywhere they want and selling within the mall, for free. This is what happens in Android, where you can get apps from anyone without restrictions, and in-app purchases wouldn’t necessarily yield any income to the Store. What they’re saying is “I want to set sell in this mall, and I don’t want to pay rent for my store space.” Wouldn’t work in real life, so why would we expect it to work in the app stores?

 

[macfacts]

Easy solution, break up apple. Apple music should be a separate company. apple music should be charged a 30% fee as well.

 

[jonblatho]

And as soon as customers have their ID/credit card numbers stolen who do you think will get blamed for it? I guarantee you Apple will be found at fault because they allowed an unscrupulous App into The App Store without proper vetting.

If Apps could use their own payment system then all Apps would suddenly become free and everyone would try to collect direct from the customer. So now I'd need to provide my credit card details to dozens of companies instead of only to Apple. No way I'm going to expose my information to that many entities.

With Apple now getting zero revenue from The App Store (because everyone decided to collect directly) who pays for the costs to operate it? Should Apple then charge developers $999 a year instead for the privilege of getting their Apps into The App Store? Perhaps they add on another $299 each time you submit an App to cover their costs for vetting? Or maybe send developers a bill for all the downloads their App got?

I see lots of whining about App Store fees, but nobody offering up any alternative solutions.

Apple already allows the use of other billing systems except for goods and services that are solely digital. Has there been any massive backlash against Apple for this? Even then, all Apple has to say is “this app’s developers elected not to use our in-app billing system” in the event of a breach. Apple itself also is far from immune to a data breach. No one’s immune. Period.

There are numerous reasons why a developer may still want to choose to use Apple’s IAP system should other payment systems be allowed. For example, Apple’s IAP system has a truly fantastic UI which is basically “push button, confirm with Touch/Face ID, done” and, from other restrictions Apple’s placed on iOS apps, nearly impossible to beat. Friction is minimal in IAP, and less friction means more subscribers. Some developers may see this and say it’s worth the higher fees.

In any case, alternative solutions exist and have been discussed at length; to pretend otherwise is ignorant at best. Apple could simply allow alternative payment systems. This could even be granted on a case-by-case basis where Apple’s competing directly with an app or service, and they get charged the credit card processing fees plus maybe some nominal charge, probably <10%. Otherwise, if Apple’s not competing with you, price the 15/30% into what you charge for your service if you want to use IAP. Done.

Apple could also allow alternative app stores and/or direct downloading apps from Safari but still require that iOS apps be signed by a valid, revocable developer certificate, issued by Apple, before they’re allowed to run.

 

[Trekkie]

ya know how you **** up a market? let congress try to fix it.

 

[RFolk]

The future is in services as it provides predictable steady stream of revenue . That is what Apple is fighting for. The challenge is that Apple music is not as popular in Europe as it is in USA. Spotify on the other hand has lost allot of their US user base in part because their confusing and sometimes frustrating UI. Whatever happens Spotify is losing big time in USA.

 

[macfacts]

And as soon as customers have their ID/credit card numbers stolen who do you think will get blamed for it? I guarantee you Apple will be found at fault because they allowed an unscrupulous App into The App Store without proper vetting.

If Apps could use their own payment system then all Apps would suddenly become free and everyone would try to collect direct from the customer. So now I'd need to provide my credit card details to dozens of companies instead of only to Apple. No way I'm going to expose my information to that many entities.

With Apple now getting zero revenue from The App Store (because everyone decided to collect directly) who pays for the costs to operate it? Should Apple then charge developers $999 a year instead for the privilege of getting their Apps into The App Store? Perhaps they add on another $299 each time you submit an App to cover their costs for vetting? Or maybe send developers a bill for all the downloads their App got?

I see lots of whining about App Store fees, but nobody offering up any alternative solutions.

Ever hear of PayPal? I buy tons of things on the internet without giving up my cc# to no name companies on the internet.

 

[Black Magic]

„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 always thought this part was messed up. it is one thing not allowing 3party apps to be installed from other sources but this is clearly just unfair competition to make sure Apple is getting their share

You spent years developing an ecosystem only to have a greedy freeloader come in to use it to make money for them but find ways to minimize how much money you get on the platform you made? I side with Apple on this. Spotify can build their own platforms and ecosystems.

 

[jonblatho]

Ever hear of PayPal? I buy tons of things on the internet without giving up my cc# to no name companies on the internet.

There’s that, but also other companies like Stripe which already have SDKs that can be used for in-app payments, just not for digital goods and services and don’t expose sensitive payment details to developers. Only thing holding it back is a policy change that Apple can either choose to make or will likely be forced to make if the antitrust investigation reaches a conclusion.
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Spotify can build their own platforms and ecosystems.

That’s not how this works.

 

[Smooley]

You see this stuff in the tech world constantly. Uber starts up and it is all roses for people who want to leverage their car value into some extra cash as a side hustle. For years it was "look how innovative Uber is with their facilitating the use of ones car to make some extra money". Now their are lawsuits everywhere about employee status, benefits, etc....
You come up with a great idea and it is lucrative but the masses will always forget that before your "app Store" you couldn't ever be an app developer for cell phones. That job didn't even exist.

 

[Madmic23]

Think of the iPhone as if it were a mall. There’s an iPhone Mall and an Android Mall and a few other less popular malls. I personally prefer visiting the iPhone Mall because (in my opinion) it’s safer, I like the products it offers more than at other malls.
Perhaps it’s more expensive just to visit the iPhone Mall than it is to visit the Android Mall, because Android Mall doesn’t charge as much to visit it (I’m talking about phone prices here). However, when it comes to being able to sell at each mall, they all charge the merchant a small percentage of your sales, instead of a fixed fee, to be able to sell at each respective mall.
The argument here, though, is that Spotify (and others) wants to be able to just walk in to each mall and not have to pay to sell, kind of like setting up a stand or taking over a space anywhere they want and selling within the mall, for free. This is what happens in Android, where you can get apps from anyone without restrictions, and in-app purchases wouldn’t necessarily yield any income to the Store. What they’re saying is “I want to set sell in this mall, and I don’t want to pay rent for my store space.” Wouldn’t work in real life, so why would we expect it to work in the app stores?

Thats not really the best example. It’s more like you bought a PS4 at EB Games, that’s downloading Spotify on to your phone. Let’s say you go home, and now you want to use the PlayStation Network. Should EB Games get a cut of that? They have nothing to do with the PlayStation Network. Likewise, Apple has nothing to do with storing or streaming music from Spotify. They shouldn’t get a cut.
If it’s an in app purchase and Apple is storing something on their servers, like a new level or character for a game, they absolutely should get a cut. That’s like me buying a game for a PS4 at EB Games, of course they should get a cut of that. But if I buy that game online from the PlayStation Store, no cut for EB Games.

 

[realtuner]

Ever hear of PayPal? I buy tons of things on the internet without giving up my cc# to no name companies on the internet.

I, along with a LOT of people, refuse to use PayPal. Why should I be forced to use another payment system I don't like?

 

[jonblatho]

I, along with a LOT of people, refuse to use PayPal. Why should I be forced to use another payment system I don't like?

PayPal isn’t the only payment services provider in existence, you know. In any case, just…don’t use it, then.

 

[now i see it]

No IOS developer wants to pay the 30% or 15% tax. If Apple doesn't keep a tight lid on this, their App Store revenues (in the $billions) will disappear overnight.

 

[Heineken]

There’s that, but also other companies like Stripe which already have SDKs that can be used for in-app payments, just not for digital goods and services and don’t expose sensitive payment details to developers. Only thing holding it back is a policy change that Apple can either choose to make or will likely be forced to make if the antitrust investigation reaches a conclusion.
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That’s not how this works.

This is exactly how it works. Apple has been building this business literally for decades and then Spotify comes crying life is unfair? What the hell?

 

[oneMadRssn]

If they don’t like what Apple is doing, then they have every right to pull their app from the store. They are not being forced to do anything. If they think the iOS ecosystem is helping their business, they they can pay like everyone else.

How else can you distribute mobile software? You have only two marketplaces - Google Play Store and Apple App Store. And developers have to use both to reach the audience, because users are locked to a single store and cannot cross-shop: iPhone users cannot download from the Google Play Store and Android users cannot download from the Apple App Store. There is literally no other way to distribute mobile software. So in a way, they are being forced to do it. Or are you ok with ceding complete control of such a huge part of the US economy to Apple and Google?

Hershey's Chocolate has dozens, if not hundreds, of different competing grocery stores in which they can distribute their chocolate. And their potential customers are not locked to any one store. Customer A does not have to shop at Store A, rather Customer A can choose to go to Store B or Store C; in others words, customers can cross-shop. So if Store A gives Hershey's bad terms, Hershey's does not necessary lose Customer A if they choose to stop selling in Store A.

Also, music streaming is unique because the costs are statutory. Spotify and Apple (and Pandora, Amazon, Tidal, etc.) all pay the copyright owners the same rates that are set by the government. Other than striking exclusive deals, there is no way around this by law. The only material difference between Apple and Spotify in terms of their business models is that Spotify must adhere to various rules set up by the marketplaces, but Apple does not have to abide by any rules on their own marketplace. This includes fees, but also restrictions on advertising and such.

 

[Rogifan]

I am rooting for Spotify on this one.

Get them a-h*les!

I cannot believe how people does not find anticompetitive that Apple does not allow them to subscribe outside of their own system. It is already arguably unfair that they even have to pay to develop and publish the app in iOS (without existing an alternative store).

What do you mean does not allow them to subscribe outside of their own system? Anybody can go to Spotify on a web browser and sign up. In fact Spotify doesn’t even allow you to sign up inside the app.

Spotify wants the same treatment as companies like Uber who can have their own sign-up and payment system accessed from within the application.

One could argue Uber is more dependent on iOS/iPhone than Spotify is. Believe me if Apple thought they could get away with taking 15% of every Uber transaction they would.

Spotify wants all the benefits of being on the most lucrative mobile platform without having to pay for it.

Doesn’t Spotify pay a developer fee? And why does Apple allow reader only apps if sales they should get a cut of digital goods sale? Because having those apps on their platform is more important than getting a cut of the sales from those apps. Apple needs developers as much as developers need Apple’s platform.

 

[itsmilo]

You spent years developing an ecosystem only to have a greedy freeloader come in to use it to make money for them but find ways to minimize how much money you get on the platform you made? I side with Apple on this. Spotify can build their own platforms and ecosystems.

that’s not how it works. Another example would be China. Why do you think everyone let’s China do their thing and still does business with them? Cuz they are huge and basically dictate even Hollywood productions nowadays.

Apple is basically China in this. Either you do business with them or you are screwed