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EU to Investigate Apple Over Spotify's Antitrust Complaint
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I come from a music industry background and I still get royalty statements and the amount of money that you get from any of the streaming platforms is more or less inconsequential...unless, of course, you are talking about having millions or tens of millions of streams.
If I had the option (I don't...it's down to the labels) I would rather pull all of my back catalogue from all of the streaming sites. I would honestly rather sell 100 CDs than have it available on streaming platforms and get in the tens of thousands of streams.
Finally someone who understands the ACTUAL problem. The problem isn’t Apple charging some fees for their service (in app purchases), the problem is that Apple FORCES DEVELOPERS TO USE IN APP PURCHASES. Their guidelines forbid developers from even LINKING to an webpage that has payment in it. Me as a developer can’t put a button linking to an online subscription page. Netflix can’t put a link, Spotify can’t put a link, no developer can put a link.
Isn’t android supposed to have the largest marketshare globally?
Google matches Apple by reducing Play Store fee for Android app subscriptions
https://www.theverge.com/2017/10/19...roid-apple-app-store-subscription-revenue-cut
Why isn’t Spotify also going after google and android for the same subscription fees.
Apple should just eject Spotify from the App Store.
Google matches Apple by reducing Play Store fee for Android app subscriptions
https://www.theverge.com/2017/10/19...roid-apple-app-store-subscription-revenue-cut
Why isn’t Spotify also going after google and android for the same subscription fees.
Apple should just eject Spotify from the App Store.
There are very few stores that you can pay a flat $100/yr from and sell all the product you want. eBay takes a cut, Amazon does also. Google Play store and all the game console stores, too. Valve charges 30% for Steam as well.
It's their platform, not EUs. I hate the walled garden and stupid rules, but Apple should be able to do what they want with it, they made it.
I see both sides argument and it’s fair - it’s really just about allowing a link.
The problem with this is, is that it will open a can of worms for ALL developers to use links which would cause a huge issue for Apple.
The problem with this is, is that it will open a can of worms for ALL developers to use links which would cause a huge issue for Apple.
That's true. Let's hope "because others do it too" mentality gets broken sometime but I don't see it happening unfortunately.
the app store is actually free, and yes sales there should only be hit with the apple pay fee which ist 0.15 or something.
the customer pays for the store with purchasing their products
Exactly, they take a cut, not close to 50% (30% or closer to 50% than 2-3% like usual).
And stores are different. I can switch whenever I want. A phone is different, unless Apple allows to install Android or install apps from outside the appstore. They even forbid to put link to external webpage to pay. The problem is the cumulation of these practices that is a problem. Kind of a prison.
So Apple can by this practice have much lower prices. And the others or they keep the same price and loose money or increase the price and become non competitive. Meaning, that competition is not sustainable.
We simply cannot compare with shops, where there is a huge amount of different shops. (and anyway, where the conditions are much better than what Apple has. So...)
When you sell through someone else you always pay some sort of commission.
No one is forcing Spotify to use the App Store.
Compete with better services and selection.
Why should Apple do all the hosting and background work for free?
Spotify is being a bigger greed machine than Apple is. Add to that the EU are run by thugs and extortionists and Apple could easily lose.
The EU just makes it up as they go along, any way to suck money out of large corporations.
How much does Amazon pay for billions of goods sold through their app? 0.
It makes sense to pay for services you use. But Spotify does not need Apple's payment services, nor Apple's data services for anything but the initial download. Just like Amazon. Charging 30% for nothing is greedy, not the other way round.
It would be fair to charge something like 5% for subscriptions, which would more than cover Apple's expenses but also offer enough in return. At the same time Apple should also offer in-app payment services for physical goods (not currently possible). Also for something like 5% and not mandatory.
So you think that Spotify et al should just create a free app but then create a link to sign up on their own website? So essentially just using the App Store as free advertising?
"I don't want to actually sell my products in your store because I don't want you to make a profit from my product...but what I am happy to do is put up a big advert in your storefront window directing potential buyers to my own store across the street...that OK? Cool..."
Sounds very much like "ambush marketing" to me in scope. In this article it explains what "ambush marketing" is:
"Ambush marketing is an attempt by an unauthorised party, through deliberate marketing activity, to take advantage of the high media profile of an event, team or individual (often of a sporting nature) at the expense of another company's (usually a rival's) official association with them, without paying any licence or sponsorship fees.
Ambush marketing is clearly a very effective marketing tool for brand owners, as it attracts consumers at the expense of competitors, and at little cost to the brand owner. However, it also has damaging effects, not only for those ambushed competitors, but also for the integrity of the event, team or individual concerned and their potential to attract future sponsors."
Now replace "event, team or individual" with "brand" and that's what this amounts to. Spotify (or Netflix etc.) wanting to take advantage of the "high profile" of the App Store without paying any fees. And, as per the above definition, it "attracts consumers at the expense of competitors, and at little cost to the brand owner" (the "brand owner" being Spotify in this case).
While "ambush marketing" isn't illegal in the UK, and while Spotify re-directing users out of the App Store to sign up on its own website wouldn't be "ambush marketing" in the strictest sense, it is parallel in terms of its mechanism and goals. I know that they can't currently do this but if the EU does try to enforce Apple to allow such links then I personally believe that would be the EU actually implementing anti-competitive rules.
Spotify is free to compete; free to compete on price, free to compete on service and free to compete on offering. If Apple Music is taking customers away from Spotify then that isn't purely based on price. And even if it were, Spotify are free to drop their price if they so choose. Just as they are free to vacate the App Store completely.
Puhlease. Spotify also practices unfair business methods when they can. In some markets, Spotify made deals with carriers so their services are opted out from the regular user’s quota, kinda the anti net neutrality.
Apple can make whatever rules they want on their platform. If Spotify doesn’t want to play, then go the Netflix/Amazon route to unbound the payment methods so users pay for the service outside the App Store. Quite simple. Even Amazon knows what to do for their Kindle. Don’t tell me it’s not doable for Spotify. They just sounds greedy and lazy.
Apple can make whatever rules they want on their platform. If Spotify doesn’t want to play, then go the Netflix/Amazon route to unbound the payment methods so users pay for the service outside the App Store. Quite simple. Even Amazon knows what to do for their Kindle. Don’t tell me it’s not doable for Spotify. They just sounds greedy and lazy.
They shouldn't but 30% is way too high for what Apple provides for many of the big apps/services.
Take Fortnite for example, Epic Games or Tim Sweeney in particular has been critical of the App Store, his argument is that for them Apple is basically providing payment processing and hosting nobody is playing Fortnite because of iPhones or the App Store, a 30% cut is extremely high for that.
As for competing with better services and selection does that not apply to Apple also? Why do they promote Apple Music in a way (marketing via push notification) that isn't allowed for third party services like Spotify then?
They are ignoring the rules they impose on third party developers and using the platform to give themselves an unfair advantage over competing services. I don't see how anybody can deny that.
I love how people here are throwing the word "greed" around like Apple isn't greedy.
Yay all free for all from now on.
So, I guess all the money from Spotify subscriptions will go to artist and nothing to a Spotify then (the same way they want it for Apple). Spotify should not get any cut for just hosting someone else’s music
Forget Spotify for a moment. This 30% cut on digital goods annoys me most on Kindle and Audible apps. Apple doesn't host the books/audiobooks, in Spotify's case music, and they shamelessly try to monetise my devices, therefore me. I cannot buy books on my iPads or audiobooks on my iPhone from competitors. I have to go websites of those apps and complete my purchases. Meanwhile, if I do the same on iBooks or whatever they call it now, no problem at all. This is the problem. If Apple think they should get paid for their apis and tools, they can offer an alternative for those who can afford one time or once a year licence fee. You know, not per user but per app or developer. For developers who are happy with Apple's service in AppStore or don't want to pay (or can't afford) that licence fee, they can carry on with the current scheme.
FFS, Apple's entire cloud cost is around $30M per month (it includes all of their cloud services -- icloud and backups, music streaming, hosting apps, etc) and if half of Spotify's paying customers are coming from iOS that's $150M profit per month right there. I really don't know who's being greedy here.
Apple got away with these anti-competitive practices up until now but that doesn't mean they will get away with it forever. Microsoft didn't, Google can't, Facebook won't, why can Apple!. Because they design their own hardware and software? The key point is they don't design those alternative apps, though! As long as your platform relies on other's work, you should be subjected to competition laws. Period.
EU should definitely burst Apple's a.. into pieces on this one. Oh you know, it's the EU marketplace and they can do whatever they want with it
FFS, Apple's entire cloud cost is around $30M per month (it includes all of their cloud services -- icloud and backups, music streaming, hosting apps, etc) and if half of Spotify's paying customers are coming from iOS that's $150M profit per month right there. I really don't know who's being greedy here.
Apple got away with these anti-competitive practices up until now but that doesn't mean they will get away with it forever. Microsoft didn't, Google can't, Facebook won't, why can Apple!. Because they design their own hardware and software? The key point is they don't design those alternative apps, though! As long as your platform relies on other's work, you should be subjected to competition laws. Period.
EU should definitely burst Apple's a.. into pieces on this one. Oh you know, it's the EU marketplace and they can do whatever they want with it
That was unnecessary.
Actually, Spotify—and every single other developer of free and paid apps alike on the app store—pay Apple $99 annually for infrastructure and hosting fees. So that's accounted for, and Spotify aren't disputing this fee.
Same as above.
It's anti-competitive for Apple to say "You're banned from inviting people to your personal website to make purchases".
It's anti-competitive for Apple to say "You can invite people to purchase your product ONLY if you use OUR payment system and pay us 30% of your sale."
So there very clearly is merit to the anti-competitive claims.
There is no need for you to dismiss valid claims as 'ludicrous' if you don't agree with them.
15/30% is not close to 50%. It could be close to 15%, or close to 30%, depending on renewals. Random internet posters don’t get to decide that Apple should only charge 2, 3, or 5%. You might as well say Apple “should” only charge $710-725 for an iPhone XS instead of $999.
I used to work for a company that sold a shrink-wrapped software application. We got paid less than 50% of the retail price by the wholesale distributor.
If Spotify doesn’t want to pay the commission, they don’t have to sell in-app. They can do what Netflix chooses to do and only allow purchases on their website. Easy enough.
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Disagree. "Purposely limit choice and stifle innovation at the expense of the user experience".
In Europe such input requires just a formal commission proof, and for sure will be quickly rejected as inadmissible. Similar company attempts against iTunes/AppStore have failed similarly.
Europe has so far been able to distinguish greed from destructive competition.
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Yay all free for all from now on.
So, I guess all the money from Spotify subscriptions will go to artist and nothing to a Spotify then (the same way they want it for Apple). Spotify should not get any cut for just hosting someone else’s music
Can you point to where Spotify has asked to be on the App Store for free? You're arguing a point you have invented.
I think Spotify generally just want an end to the anti competitive practices Apple has used to promote Apple Music.
Is that what you really think? I think you might be surprised to find out what online retail platforms charge. Amazon, for example, has two selling plans: the Professional Selling Plan and the Individual Selling Plan.
The Professional plan has a $40 per month fee, no "Per Item" fees but every item sold has a "Referral Fee" which can vary from 6% all the way up to 51% but which seems to average out around the 15-17% mark. The Individual plan, meanwhile, has no monthly fee but has a $0.99 "Per Item" fee as well as the same "Referral Fees". So on a $10 item the Professional plan user could be hit with fees of anything from $0.60 all the way up to $5.10 (so between 6% and 51%) and an Individual plan user could face fees of anything from $1.59 all the way up to $6.09 (from 15.9% up to 60.9%)! Amazon aren't alone though. Let's look at Ebay...
Here in the UK you get up to 1,000 listings per month free and given the Spotify model, you could achieve that with just one listing, so let's assume no listing fees. OK, moving on to "Buy It Now" fees. In essence, as Ebay is an auction site, if you want to offer an item at a fixed price, like a subscription would be, you have to add in a "Buy It Now" option, that is 50p flat fee. Making your item visible internationally, another 30p flat fee. That is 80p so let's say 8% on a £9.99 per month subscription. Seems better...right? Sure, but then let's look at PayPal fees. PayPal standard business rates are 3.4% of the transaction amount plus 20p. So on our £9.99 subscription that is another 54p. Add that to the 80p from Ebay and you are up to £1.34 or just over 13%.
"Still better than the 30% that Apple takes" I hear you cry. Well, yes and no. Apple only takes 30% for the first year and then 15% thereafter. So yes, there is an initial drop in revenue compared to Amazon (although Amazon could potentially be way higher, and in perpetuity) and Ebay, but then you also have access to a user base of what...200 million plus?
I think that there are several main considerations here:
- The cost of running the App Store is irrelevant to this debate, as others are allowed to add their own payment systems in the app — Uber, Amazon Prime — so Apple decides what is allowed and what not, which is not a transparent process
- Apple promotes its own service in ways that competition cannot — shameless notifications for Apple Music for example that are not allowed by others because they violate App Store rules
- Apple gives its own services access to APIs and hardware that 3rd parties cannot have, which does create an unfair advantage
- The App Store does have a monopoly on iOS, because nobody can create an alternative app store because nobody has access to certain APIs. The only way is to do this on another platform, which still means that Apple has a monopoly on iOS
- Apple can change the rules for number 1,2, 3 and 4 at will, without any means to appeal. If Apple decides tomorrow that ride sharing services need to pay Apple Tax, there is nothing they can do (except appeal with the EU maybe)