Spotify CEO on Apple and Google: 'If You Want to Be the Referee, You Can't Also Be the Player'

[gregmancuso]

The 30% commission Apple charges in the App Store is insane. if you sell your house with a real estate agent, what do you pay - anywhere from 2% - 8%?

To borrow a quote - And if my grandmother had wheels she'd be a bicycle.

What does a realtors commission on a real estate transaction have to do with the value Apple sets on all that is provided by the 30% fee? And it is a lot more than transaction processing and app hosting.

 

[Piggie]

Just to clarify my earlier post.
The point I was trying to make was that we 'unfortunately' have a very small minority of vocal Apple fans who repeat a similar line every time something like this comes up.

"Well, if you don't like Apple due to X, then go build your own system, then you can do as you like"

We have many rules/laws in place to stop this type of behaviour, when it comes to Race, Sex, Age etc.
We don't in a civilised and (hopefully) fair/caring society use that thought process.

Thankfully we have those in power who we vote for that ensure companies who get very large and take advantage of their size to maximise their own wishes over everyone else, put into place rules/restrictions etc to hopefully allow some balance.

As much as I'm sure there are many strong Apple fans, even those people must understand that letting Apple do exactly as it wants for eternity, getting larger and more powerful decade after decade would inevitably be a very bad thing for everyone.

 

[Hails09]

This is getting to be a bit of a stretch, but yes.

Suppose the grocer is a brand that lives a "healthy-fit" ethos. Said biscuit maker has been on the shelves since day one. But now has changed the recipe and added ingredients that are demonstratively unhealthy or downright dangerous. The grocer is most certainly going to pull your biscuits from the shelves and show you the door. Or demand you sell the original product in their store.

No different than blocking an update to an app update that adds "features" that violate policies.

Well these companies like Spotify must be winning the argument & proving other wise. Based on what the European Commission is focusing on.

 

[BaldiMac]

If you charge $10/month for your music service, it is anticompetitive to take 30% of your competitors $10/month music service.

If you owned a store in a mall selling (price-controlled) Rolexes and the mall opened their own store next door to you selling the same Rolexes, you'd cry foul.

But the mall analogy still isn't as bad as the App Store... The mall does incur lost revenue (not leasing finite space to another tenant) with their own store where Apple does not. And you can at least move malls.

1. Spotify doesn't pay Apple 30%. They pay them nothing except possibly a few legacy subscriptions at 15%.
2. Store brands exist and there is nothing fundamentally anticompetitive about them.

 

[danpass]

I tried Spotify a while back and it was kludgy.

Then again about a year ago. It was maddening how I couldn’t skip to the next song and couldn’t figure out the problem.

Until I discovered it was intentional, that full functionality would require some form of subscription.

Really? Charging for the most basic functions?

Hard pass.

Spotify CEO needs to be quiet.

-

 

[Hails09]

They can feel free to make their own phones and app stores. Nothing is stopping them.

Or you could say don’t questionable business policies.
Then governments wouldn’t have to keep looking into your business model

 

[cocky jeremy]

Or you could say don’t questionable business policies.
Then governments wouldn’t have to keep looking into your business model

It's Apple's platform, Apple's rules. If you don't like it, you're free to take a hike. Apple doesn't owe competitors anything.

 

[chandler55]

It's Apple's platform, Apple's rules. If you don't like it, you're free to take a hike. Apple doesn't owe competitors anything.

you can extend this logic to any monopoly or antitrust in history though. the govt has a duty to ensure capitalism doesnt get too crazy

 

[Hails09]

They can feel free to make their own phones and app stores. Nothing is stopping them.

Or you could say don’t questionable business policies.
Then governments wouldn’t have to keep looking into your business model

It's Apple's platform, Apple's rules. If you don't like it, you're free to take a hike. Apple doesn't owe competitors anything.

If as you say it’s apple’s platform & they can do what they like.
Then why are they getting investigated for anti steering policies?

 

[danpass]

you can extend this logic to any monopoly or antitrust in history though. the govt has a duty to ensure capitalism doesnt get too crazy

The real solution is to REDUCE regulations. Makes it easier for competition to come into the market.

But a gov choosing to give up power? That’s not happening.

So instead, the flex.

 

[webkit]

They can feel free to make their own phones and app stores. Nothing is stopping them.

So you feel there should be no antitrust laws regarding dominant companies and anticompetitive behavior? Netscape, Sun Microsystems, computer OEMs, etc. should've had no arguments against Microsoft (Windows) in the 1990s because each of them made or could've made their own OS or hardware? Similarly today, companies should have no arguments against Apple (iOS), Google (Android), etc.

 

[webkit]

The real solution is to REDUCE regulations. Makes it easier for competition to come into the market.

But a gov choosing to give up power? That’s not happening.

So instead, the flex.

If regulations are reduced, that can allow dominant companies to wield even more power and control over particular markets thereby potentially making it even more difficult and more expensive for competition to come into the market.

 

[BaldiMac]

If regulations are reduced, that can allow dominant companies to wield even more power and control over particular markets thereby potentially making it even more difficult and more expensive for competition to come into the market.

Except there is already strong competition in the streaming music market. Why do we need regulation to improve competition when strong competition already exists?

Music streaming services subscribers market shares 2024| Statista

The music streaming market is dominated by Spotify with the biggest market share, followed by music streaming serice Apple Music.

www.statista.com

 

[cthompson94]

Assuming the game consoles truly are sold at a loss, which I doubt given pricing and backlogs people face trying to buy them, WHO CARES?

Let's assume the consoles are in fact sold at a loss, why does that mean that 30% cut for sales and IAP is more warranted than Apple's 30% cut. If tomorrow Apple implemented a 50% cut on MSRP of iPhones and iPads would these developers all of a sudden be OK with at 30% cut from the App Store? I'd bet not.

I agree with you, while majority of game consoles are sold at loss article it is a temporary loss basically until like you said the bulk orders come in and the companies like Sony can order larger batches of components lowering the cost per unit. The article basically gives the timeline it took for some consoles to stop selling at loss a recent being the PS5 at 8 months.

The market like you said is different where Apple is primarily hardware with software getting larger with Apple getting in the subscription market. Companies like Sony and Microsoft are willing to take a loss since they want consoles in homes, and since everyone Nintendo, Sony, Microsoft have subscriptions to play video games online then there is one source of income and plus the average person isn't going to just get one game either. The margins on games also vary with a simple one being the cost difference between a digital game and physical with both costing the same, but of course the digital game being much higher return.

 

[webkit]

Except there is already strong competition in the streaming music market. Why do we need regulation to improve competition when strong competition already exists?

I was speaking more broadly and how it would/could play out i.e., if you are going to reduce regulations in one industry it would/could apply similarly to other industries.

As far as the streaming music market goes, part of the reason there is "strong competition" is because regulations exist. Reducing regulations could potentially allow companies to run wild and engage in anticompetitive behavior that if left unregulated could turn the "strongly competitive" music streaming market into something quite the opposite.

 

[BaldiMac]

I was speaking more broadly and how it would/could play out i.e., if you are going to reduce regulations in one industry it would/could apply similarly to other industries.

As far as the streaming music market goes, part of the reason there is "strong competition" is because regulations exist. Reducing regulations could potentially allow companies to run wild and engage in anticompetitive behavior that if left unregulated could turn the "strongly competitive" music streaming market into something quite the opposite.

And the thread is about Spotify arguing for more regulation despite a highly competitive market. Hence, my question.

 

[webkit]

And the thread is about Spotify arguing for more regulation despite a highly competitive market. Hence, my question.

Part of this thread may be about "more regulations" but you responded to a reply I made to a post stating that, "The real solution is to REDUCE regulations."

I also stated in the reply you responded to that, “If regulations are reduced..."

The discussion you came in on (replied to) was clearly about reducing regulations.

 

[icanhazmac]

So you feel there should be no antitrust laws regarding dominant companies and anticompetitive behavior? Netscape, Sun Microsystems, computer OEMs, etc. should've had no arguments against Microsoft (Windows) in the 1990s because each of them made or could've made their own OS or hardware? Similarly today, companies should have no arguments against Apple (iOS), Google (Android), etc.

Nuanced question.

Netscape, no, I don't believe they had any ground to stand on. Microsoft may have made their product the default but what was stopping anyone from installing Netscape? Right, nothing, except maybe ignorance of how to do so. Perhaps if Netscape had a better product or better marketing they would have done better. Better product equals consumer demand. Better education of consumers on how easy it was to install would have helped too but not many will take the time to switch without some benefit. Can't blame Windows for having a well adopted product. Apple was out there, Linux is out there, etc, only few wanted them.

Today, no arguments with Apple as I feel they represent a unique ecosystem of one stop shopping that I value. I would love it if every Mac app were in the official store just like iOS. If you don't care for that level of control you can go with Android.

Google is another animal and this is not just Google vs Apple hate.

Google controls internet searches.
Google controls internet advertising. (data mining)
YouTube controls video on the internet.

Alphabet is way too large, time to break it up.

 

[alanpaone]

Have spotify considered making a decent app, since that's the only thing they have? or perhaps not blowing huge piles of cash on being the worst way imaginable to listen to pod casts? seems like there's plenty of runway here

 

[Mrkevinfinnerty]

Some of you have been very uncharitable of my truth bombs in this thread.

I think we all know deep down that it is time for the App Store to go the way of the lightning port

 

[LiemTa]

Smartphones, I mean, it’s a stretch, but let’s just say you’re correct. In no way does that mean iPhones are required.

I knew this low IQ comment would be posted. Are smartphones required in the same metric as oxygen? No, but if you need to take it there to eek out on a technicality, how sad is that

 

[Sophisticatednut]

A customer that patronizes WalMart is a customer of WalMart, WalMart’s customer.
Vendors engage with and provide goods to WalMart in order to be presented to WalMart’s customers.

A customer that patronizes “X town Mall” is a customer of “X town Mall”, “X town Mall”’s customer.
Companies open stores in “X town Mall” in order to be presented to “X town Mall”’s customers.

Just because the word “Apple” is added in a phrase doesn’t change the terminology of business. Although it’s clear some really wish it weren’t true.

Being a customer of X doesn’t in any sense of the word imply X owns the rights and access to those customers.

Nothing prevents a company from circumventing Walmart, x town mall, x store and go directly to their customer by cutting out the middle man.

so what we need to establish:
Can company x legally conduct business with an Apple customer even if goes against the interest of Apple?

Apple doesn’t have the legal authority or right to use legal means to prevent the business transaction to happen without them as the middleman/arbitrator?

If the the answer is yes, then it can logically follow that Apple intentionally trying to force themselves in between the two legal entities as the only option is anti competitive as it directly harms the independent interest of the stakeholders

 

[Sophisticatednut]

And the thread is about Spotify arguing for more regulation despite a highly competitive market. Hence, my question.

Because it’s not the music market being regulated or questioned. It’s the applicationstore market. Especially the specialized market known as the iOS AppStore. And the fact Apple uses anti competitive practices to keep their advantage over competing solutions that is provided to the consumers who own an Apple device

 

[picpicmac]

you can extend this logic to any monopoly or antitrust in history though.

Analogy does not work in this case. Apple is not a monopoly, nor is it a trust.

Apple is far from a monopoly, as the comments section of any Youtube video on Apple products will demonstrate as all the "gamers" leave nasty comments about how their PCs are better.

I don't normally use Apple Music. I use Youtube Music and Prime. I think I've bought maybe one or two pieces of music from Apple in the entire time since they started iTunes and its purchase function.

Spotify is just whining because it's a bad business, by which I mean it has never figured out how to make money other than promising investors that one day it will be profitable.

 

[picpicmac]

But a gov choosing to give up power?

Oh please. There is nothing stopping you from starting a company offering streaming services. Your religious devotion to some anti-government ideology is getting in the way of you understanding what the real problem is in regards to what is going on with Spotify, etc.

People want to listen to music but they don't want to pay for it. Or at least not wanting to pay what it takes to produce it and make it available on demand.

Hence Spotify struggles to make money. Prime only exists because people want preferred shipping and guess what Amazon throws in additional services. Youtube exists so Alphabet can know more about you than you know about you. None of these services could survive only on what people want to spend for music.

There are many small label music producers out there, they almost all struggle.

The situation is unlikely to change.