Become a MacRumors Supporter for $50/year with no ads, ability to filter front page stories, and private forums.
When Spotify's venture capitalists created Spotify they knew the App store rules but chose to participate. They were comfortable riding the App store to become the largest, by far, streaming music company in the world, and now complain, because they have a poorly run business that has lost hundreds of millions of dollars all from the get go.

Thanks to Apple they have access to a billion customers on a platform that Apple spent tens of billions creating and spends billions maintaining every year. For the bulk of their customers, which the CEO is misleading people about, they pay a commission of 15% to have access to that platform and customer base. A huge bargain by any measure.

Spotify also pays artists poorly, about half of what Apple pays, and Spotify is fighting recent efforts to pay musicians and artists an increased rate. Apple is supporting that effort.

Spotify is understandably panicking that Apple may be about to announce a package deal with music and video, etc., that will push Spotify's poor business model even further into the red.
The only thing that’s poor is Apple Music. Period.
 
Spotify sounds like greedy crying little babies
That’s not apples responsiblity. That is solely on the consumer to do their research before buying anything
How does Apple sound in their case against Qualcomm? And isn't apple like at least 10 times bigger than Qualcomm(in terms of revenue anyway).
 
  • Like
Reactions: macfacts
It's complicated, but there does need to be a reasonable compromise. Spotify benefits from Apple's infrastructure and customer base, but Apple is allowed to skate by without paying a 30% royalty because they are the ones that collect the money, which allows them a competitive advantage based on pricing. Apple needs to pay the 30% fee and roll it into their Apple Music price.
And as a user, I dont want to pay 10 companies per month. It is much better for me to
"Apple's AppStore - Apple's rules" is NOT a justification for anti-competitive behavior, and rent seeking. Apple is the owner of one of two dominant smartphone platforms, in what's basically a duopoly market. They should not be leveraging their platform to lock out or disadvantage their competitors, in favor of their own services.

Apple has locked down the entire ecosystem of iOS device owners to the AppStore, and they don't allow alternative means for content owners to distribute their apps, and reach huge numbers of their customers.

To not even allow companies like Spotify to provide a link within their app to where their customers can sign up for the premium service is just bonkers. It's bad for the competition, it's bad for the market, it's bad for us, as consumers.

What Apple is doing is at the very least immoral, and possibly illegal. The EU court will decide on then latter.

Isnt web apps possible? See how wechat can do that. can anyone pay from websites? Yes. Can they remove payment option in their main app? As far as I know, Yes. Netflix had.
As a consumer, I am glad that I pay through apple. No need to worry about hacked credit card and customer details.
[doublepost=1552644900][/doublepost]
And as a user, I dont want to pay 10 companies per month.


Isnt web apps possible? See how wechat can do that. can anyone pay from websites? Yes. Can they remove payment option in their main app? As far as I know, Yes. Netflix had.
As a consumer, I am glad that I pay through apple. No need to worry about hacked credit card and customer details.
 
If Apple charged everyone 30% and doesn't itself compete in music streaming, that's fine. Everyone is playing on the same field and by the same rules. The problem is Apple is using its market strength in app stores to advantage itself in the market of music streaming because it isn't subject to the same 30% fee and restrictions on advertising.

Just think about the math: Let's say a Content Owners charges $2.50 to anyone who wants to offer it for download, and both Apple and Competitor offer it to download. Apple sets the price at $3. If Competitor sets the price at $3, it has to pay Apple $1, and thus only gets $2. Thus, at the $3 price point, Competitor loses $0.50 per download AND Apple makes $1 for each of Competitor's downloads, and Apple makes $0.50 for each of Apple's downloads. Competitor can't price it higher than Apple, because they would lose customers.
All you saying is Spotify is losing 30% has nothing to do with them having an unfair disadvantage over Apple. Spotify has the same exposure as Apple if not even more because Spotify is almost synonymous to music streaming. I know more people using Spotify than Apple Music and these people are very happy with the service. If somebody is getting free exposure and success of Spotify is because of the Appstore. They chose the route to use the Apple service just like Amazon uses UPS, FedEx and USPS to ship their product. Now Amazon uses their own service to deliver their product and it cost less for them to do so. If Spotify keeps whining of paying more, then they better off delivering their service somewhere else like start their own. I bet it's not easy and not cheap to do that route.
 
I love both companies (and am a shareholder of both). I have to side with Apple on this dispute.
 
It's never as black and white as that. Concern for the public good frequently overrides what is good for business, especially in the EU, where Spotify is bringing their protest. An example of putting the public before profits, even here in the United States, is making it illegal to price gouge (gasoline, water, food) after an emergency. Airlines are constantly watched for collusion on prices. Although Apple is the one in the hot seat right now, the duopoly of Apple and Google will be reviewed by the EU...and it be should.

As long as they are not preventing competition. They will be fine. No one is stopping Microsoft from creating a new phone and platform (which they had). Nor Nokia, or Palm or anything of the sort. They are all allowed to create and compete. IF you're going to use it on Google or Apple's platform. Then you pay. You have choice. This "show" the EU is doing is mostly just complaining that there is a lack of other competition. We would all love 10 or so competing companies. But, it's not always practical or possible.
Having an iPhone or a Android phone isn't a requirement or a right. You can live just fine without. And if the EU ends up making either of these business have a harder time operating in said countries. They can go back to the flip phones, and no apps. Plus a pull out of all the tech talent that comes with in their respective areas.
 
The PlayStore Spotify app redirects users from within the app to Spotify's web's site the moment a user wants to subscribe for the ad free tier.
So they are bypassing the 30% cut from Google.

An Apple user can do the same thing, they just need to go to Spotify's web page to register.
 
  • Like
Reactions: gnasher729
I get your point and understand both sides.
Anyway, personally I find that Apple is very close to monopole here and thats the big problem.

For customers an option to install apps outside from App Store would be very positive, e.g like macOS.
Spotify are not the only ones who ran into AppStore problems.

Apple needs to be forced to allow App installs from outside the AppStore, then i see the problem as solved.

As iOS devices are a similar platform to game consoles then yeah, why not, do it like Microsoft and Sony do. Just ship apps on copy protected read only media that you can plug into your devices to load the apps on. That would be perfect, works for all consoles, digital store and physical media. Just like Sony and Microsoft, Apple can control the applications but you can buy them from wherever you want.
 
All you saying is Spotify is losing 30% has nothing to do with them having an unfair disadvantage over Apple. Spotify has the same exposure as Apple if not even more because Spotify is almost synonymous to music streaming. I know more people using Spotify than Apple Music and these people are very happy with the service. If somebody is getting free exposure and success of Spotify is because of the Appstore. They chose the route to use the Apple service just like Amazon uses UPS, FedEx and USPS to ship their product. Now Amazon uses their own service to deliver their product and it cost less for them to do so. If Spotify keeps whining of paying more, then they better off delivering their service somewhere else like start their own. I bet it's not easy and not cheap to do that route.

It's funny, you countered your own argument. Amazon doesn't own a shipping platform (yet). Amazon can choose between UPS, FedEx, USPS, a ton of small third-party last-mile carriers, or they can do it all on their own by hiring drivers directly. Tons of choice.

When it comes to mobile software distribution, there is no choice. You have to use Apple and Google. It's not an either/or, it's both; because you can't distribute using the PlayStore on iOS and you can't distribute using the App Store on Android. It's a bonafide duopoly. It's not a choice when you must use both. And to make matters worse, both are pretty lockstep in how much they charge.

Having a duopoly market power is fine on it's own. Nothing wrong with that. But using that market power in one industry (mobile software distribution platform) to disadvantage competitors in another industry (streaming music) is an abuse and is about as clear cut of an antitrust violation as you can get.

It's no different than when Rockefeller controlled the railroads, so that he could distribute his oil for nearly free and charged his competitor oil companies way more to distribute their oil. He used his monopoly in distribution (railroads) to disadvantage competitors in another industry (oil). That is literally where most antitrust law comes from.
 
  • Like
Reactions: MadeTheSwitch
It's funny, you countered your own argument. Amazon doesn't own a shipping platform (yet). Amazon can choose between UPS, FedEx, USPS, a ton of small third-party last-mile carriers, or they can do it all on their own by hiring drivers directly. Tons of choice.

When it comes to mobile software distribution, there is no choice. You have to use Apple and Google. It's not an either/or, it's both; because you can't distribute using the PlayStore on iOS and you can't distribute using the App Store on Android. It's a bonafide duopoly. It's not a choice when you must use both. And to make matters worse, both are pretty lockstep in how much they charge.

Having a duopoly market power is fine on it's own. Nothing wrong with that. But using that market power in one industry (mobile software distribution platform) to disadvantage competitors in another industry (streaming music) is an abuse and is about as clear cut of an antitrust violation as you can get.

It's no different than when Rockefeller controlled the railroads, so that he could distribute his oil for nearly free and charged his competitor oil companies way more to distribute their oil. He used his monopoly in distribution (railroads) to disadvantage competitors in another industry (oil). That is literally where most antitrust law comes from.
Have you heard the internet? You can stream audios and videos online without distributing through Appstore. Too bad Spotify is not confident enough to provide service without Google and Apple that's sad. Netflix is very successful of not providing in-app purchase anymore same thing with Amazon Music well Spotify can cry all they want but not getting it for free. You got to pay the ticket for a bus ride and you cannot ask Rockefeller a free ride for your goods either. By the way Amazon uses some of their plane to ship their products.
 
Have you heard the internet? You can stream audios and videos online without distributing through Appstore. Too bad Spotify is not confident enough to provide service without Google and Apple that's sad. Netflix is very successful of not providing in-app purchase anymore same thing with Amazon Music well Spotify can cry all they want but not getting it for free. You got to pay the ticket for a bus ride and you cannot ask Rockefeller a free ride for your goods either. By the way Amazon uses some of their plane to ship their products.

Apple isn't competing with Netflix yet. Later this month, when Apple launches a competitor to Netflix, I wouldn't be surprised if Netflix joins Spotify in this complaint.

Also, have you tried streaming music through the browser on iOS with the screen off? It doesn't work.
 
  • Like
Reactions: MadeTheSwitch
Isnt web apps possible? See how wechat can do that. can anyone pay from websites? Yes. Can they remove payment option in their main app? As far as I know, Yes. Netflix had.
As a consumer, I am glad that I pay through apple. No need to worry about hacked credit card and customer details.
[doublepost=1552644900][/doublepost]

Web Apps is not any kind of alternative to a platform-native apps. Probably half of functionality Spotify offers via native app would not be possible via HTML5. And why should Spotify and their customers be relegated to a second-class citizen experience on a platform? How do you expect Spotify and others to be able to complete against Apple Music (and soon Video)?

3rd party content providers should not be subjected to uneven playing field and being treated as 2nd class citizens when competing with Apple's own services. This is exactly what Spotify CEO is complaining about.

Try and see things from something other than Apple's perspective for once.
 
  • Like
Reactions: MadeTheSwitch
I think a lot of people are missing the point here. Many keep making metaphors about buying something in a store or on Amazon and the retailer taking a cut. That's understandable...it's not really what's happening here, though. Imagine going to Walmart and buying a product that requires a subscription to work--an Abobe CC Suite disk, for example. Now imagine Walmart requiring that...

1. You MUST activate the disk with special Walmart kiosks in store. Adobe is not allowed to provide any instructions for activating at home.

and...

2. Each month you pay Adobe for your subscription, Walmart gets 30% of that subscription.

That would be absolutely ludicrous; that is what apple is doing. Walmart has a loyal customer base of millions and has spent the countless prerequisite hours and dollars necessary to create an infrastructure that draws people in and keeps them coming back, but no one would ever suggest their doing so entitles them to a profit of subscription services just because the initial product was purchased in one of their stores.

You want to take a cut of a product bought at the store (an Adobe CC disk or the Spotify app)? That's understandable. You want to take a cut of a service that product provides and you have no part in providing? That's ridiculous.

It's a nice attempt, but it's not exactly what happens here. Rather than Walmart, you should imagine the following...

1. You buy a new, luxurious house. You've paid a hefty sum for it, but it's worth it. The developer has built it using some of the best technology available on the market. Because the house is so great, they have you 5 years warranty on it, so when the doors start to creek or the drain is getting clogged someone comes in and does the maintainance for you, free of charge.

2. You love living in your new house, but obviously, you don't just sit arround in it doing nothing. You want to "live" in it, sleep, eat, watch TV, listen to music and so on. The developer has a division that serves other markets than housing, such as utilities, entertaiment, clothing, even take away restaurants. You can get your electricity, Internet, TV subscription even your food from a company affiliated with the developer. But you don't want to. You prefer ta TV subscription from another provider and you don't fancy the developer's cuisine that much either. So you order a different restaurant on your lindline and order your food in from a different take-away, but when it arrives the pizza boy wants to charge you a mark-up of 30% because your developer says charges extra if a) you want to eat the food at home, which they built; and b) you used the landline which they set up. You refuse, this is of no concern to you. The pizza boy gives in and his company soon goes out of business, because your home is not the only one in the vicinity built by that paritcular developer. And it's only the start. You wnat to order some new clothes online? You have to order them through the developer's affiliated delivery firm, or else pay a markup of 30%. Not happy about it. Well, you can always wear the clothes at your neighbour's place, but at home, you need to walk around naked, because the developer build the house and we all know that whoever builds the house calls the tune. No need to worry, it's a free country, as a consumer, you always have a choice. So you either buy all your stuff from/through the developers afiliated companies, or you pay a 30% markup or otherwise see one independent local goods and service provider close their business after another. Or else, if you don't like this arrangement you can always go and get yourself a new home. It is a free country, after all.

The developer is obviously Apple, and the home in this story is your phone. You - the customer - have already paid for your phone. You paid only once for it, but you still enjoy a few years of "free" (or rather - pre-paid) mainteinance and support. You've paid to Apple for developing it, including the utility access points. In fact you bought the house and paid for it through the nose precisely because it had a lot of the amenities and utilities. So, unless you want to tell me that your landlord or housing developer has the right to charge you 30% on every morcel of food, clothing and whatnot that you bought though a 3rd party but consume the house owned/built by them, then you should not support apple for charging you (yes you, not Spotify, because they either have to pass these cost on to you or go out of business) for every service you consume "through their appstore".
 
Apple isn't competing with Netflix yet. Later this month, when Apple launches a competitor to Netflix, I wouldn't be surprised if Netflix joins Spotify in this complaint.

Also, have you tried streaming music through the browser on iOS with the screen off? It doesn't work.
Besides stop acting like Apple is getting a free ride and Spotify has to pay the burden. Apple built the platform which cost a lot of money and it cost them 3 billion to acquire Beats to provide music streaming service. So basically they're sort of paying indirectly. Netflix is very happy of its current status they're in a position of you want Netflix signup straight to them no need in-app purchase. Sorry Spotify!
 
Besides stop acting like Apple is getting a free ride and Spotify has to pay the burden. Apple built the platform which cost a lot of money and it cost them 3 billion to acquire Beats to provide music streaming service. So basically they're sort of paying indirectly. Netflix is very happy of its current status they're in a position of you want Netflix signup straight to them no need in-app purchase. Sorry Spotify!

Everytime one of those teardown articles comes out, which shows the iPhone hardware only costs something like $250 to built, Apple fanboys are all up in arms talking about about how we're paying for the platform and the app store and blah blah it costs money. Which is it? Are the users paying for the platform as part of the cost of buying an iProduct? Or did are the developers paying for the platform through the 30% fee?
 
Firstly, Apple’s iOS commands less than 15% of the smartphone market, ...

But Apple controls 100% of the iOS app store market.

Contrast that with Sony who does not own 100% of PS4 game stores. Other stores can sell PS4 games too. I don't see any malware on PS4. I don't see Sony going poor, PS4 devs still have to pay dev fees to Sony.
 
  • Like
Reactions: MadeTheSwitch
Apple Inc. v Pepper decision should come about this summer. A favorable ruling for Pepper would open the door to a future trial where consumer damages could be assessed in the billions. To avoid future lawsuits, Apple might be forced to do the unthinkable and open Apple’s closed app ecosystem to third-party app sellers.
 
Everytime one of those teardown articles comes out, which shows the iPhone hardware only costs something like $250 to built, Apple fanboys are all up in arms talking about about how we're paying for the platform and the app store and blah blah it costs money. Which is it? Are the users paying for the platform as part of the cost of buying an iProduct? Or did are the developers paying for the platform through the 30% fee?
Whatever dude funny how you start attacking me and you don't even know me. Next time stick to the argument. Sorry can't continue this anymore.
 
This is incredibly similar to what got Microsoft in trouble with IE back in the day. When you are the OS and by extension the platform, you are put in a special position where you have to play fair, even with your competitors. Apple is not playing fair, and Spotify is exactly right to complain about it. Compete on the service, don't compete on business leverage.

Microsoft was the leading OS being used world wide by consumers
here, ANDROID is the leading Mobile OS being used worldwide

IE was the most used browser by consumers
here, It is spotify which has the monopoly, not Apple Music.

Apple has had the cut of the subscription and app sales since the start of the app store, its not a NEW development. It was also the same when Spotify first landed on the App store and it is the same now. Nothing changed except Spotify is losing money more so this is a business move BY Spotify to save themselves from the same rules they USED to become a monopoly

Please educate yourself on history and context before making ridiculous historical comparisons.
 
I'm with Spotify on this. There should be no reason Apple should be taking 30% of Spotify's subscription fees. The same goes for any subscription service that isn't leveraging Apple's own developed apps. If Spotify wanted to charge a fee to buy their iOS client, Apple can get their cut. If Apple allowed Spotify to somehow allow customers to use Apple's Music app, Apple should get a cut. 30% is excessive and should be drastically reduced.
But Spotify _can_ sell their subscriptions without paying anything. The rules are: 70% if you sell the subscription through the AppStore (85% after a year), 100% if you sell outside the AppStore. Netflix does exactly that.
[doublepost=1552676071][/doublepost]
Sure they are... they want Apple to distribute their app for free while Spotify alone profit from subscribers who pay to use it.
And they can even do that - as long as they don’t take payments through the app, and don’t advertise through the app.
[doublepost=1552678875][/doublepost]
Web Apps is not any kind of alternative to a platform-native apps. Probably half of functionality Spotify offers via native app would not be possible via HTML5. And why should Spotify and their customers be relegated to a second-class citizen experience on a platform? How do you expect Spotify and others to be able to complete against Apple Music (and soon Video)?.
The only thing that Spotify needs to do on their website is take payments. Like Netflix does. Just because Spotify complains, you shouldn’t assume they are actually right. Me and quite a few colleagues make an excellent living from the AppStore without anything going to Apple except $99 a year.
[doublepost=1552679096][/doublepost]
Not much point of debating this with you further, as you clearly don't understand the meaning of simple words such as "choice".
Let me explain this: Spotify can sell their subscriptions without paying Apple. With a free app on the AppStore. Just like Netflix, which read the AppStore rules and applied them to their business instead of throwing a tantrum.
[doublepost=1552679431][/doublepost][QUOTE="ctyrider, post: 27182323, member: 717570]To not even allow companies like Spotify to provide a link within their app to where their customers can sign up for the premium service is just bonkers. It's bad for the competition, it's bad for the market, it's bad for us, as consumers[/QUOTE]
Apple doesn’t allow advertisements to get past the AppStore _on the AppStore _. Spotify can advertise anywhere, for example on the macrumors site. Just not for free and at Apples expense in the AppStore.
 
Wouldn't Apple loose money if a subscriber shifts from Spotify to Apple Music ? because Spotify is not paying a cut (15-30%) from subscription.
AppleMusic isn’t free. Apple would get 70+30% of the Apple Music subscription.
[doublepost=1552679883][/doublepost]
[doublepost=1552607485][/doublepost]Aren't there software companies that you can purchase software directly from their website and not go through the App Store? I have many titles that go to their website to update to the latest version. No Apple App Store!
Not the software, which is free anyway in this case, but the music subscription or anything else you charge for. That’s why Spotify ‘s complaint is so unreasonable.
 
He who owns the platform makes the rules.

Spotify is free to build up their own platform painstakingly from scratch and design their own hardware the same way Apple did if they want to call their own shots.
i am afraid apple is a victim of its own success... the app ecosystem is now a fundamental component of how we all communicate and do business and so it is necessary to think about regulation in order to create a level playing field

fairness to consumers should be the prime consideration and apple clearly isn’t being fair to consumers in the case of spotify

congress will (and should) certainly act on this
 
But Apple controls 100% of the iOS app store market.

Contrast that with Sony who does not own 100% of PS4 game stores. Other stores can sell PS4 games too. I don't see any malware on PS4. I don't see Sony going poor, PS4 devs still have to pay dev fees to Sony.

All games have to be passed by Sony and are physically mastered at Sony licenced factories. You can’t make a Game for PlayStation without Sony’s approval or without paying Sony. Same with Microsoft and Nintendo, btw. And it costs more than 30% to sell games through 3rd party stores.
[doublepost=1552684766][/doublepost]
i am afraid apple is a victim of its own success... the app ecosystem is now a fundamental component of how we all communicate and do business and so it is necessary to think about regulation in order to create a level playing field

fairness to consumers should be the prime consideration and apple clearly isn’t being fair to consumers in the case of spotify

congress will (and should) certainly act on this

Only for those using iOS, who make up the minority of mobile device users. Spotify is the market leader by a massive margin, so their complaints should rightfully fall on deaf ears. If you want an even playing field then Apple should be able to sell songs and albums through Spotify for free.
 
Register on MacRumors! This sidebar will go away, and you'll see fewer ads.