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

[alexe]

Au contraire. Spotify, like Netflix, could offer sales of their service outside of the the App Store and not pay the 30%. There are many businesses that have apps on the Apple App Store that do not offer financial transactions through the store.

That's beside the point. Sure, not offering transactions through the store is a possibility, but it still puts those developers at a disadvantage when at the same time Apple can offer transactions through the store without paying a fee.

The entire fact that Apple dictates a singular way to access apps is just wrong.

Imagine a single company controlled the only way you could install software on your computer. That would sound ludicrous, wouldn't it?

 

[contacos]

Europe has internalized that the referee can't be a player on so many levels in the world, high-tech and military just two of them. They love to tell others what to do.

You would be surprised about the rules we have here. No vacuum cleaning between noon and 2 pm and not at all on Sundays, you are technically not allowed to throw away glass bottles after 7 pm and your dog is (again technically) only allowed to bark 30 minutes per day, not after 10 pm and only 10 minutes at a time oh and of course it’s illegal to clean your car on your property. I am actually surprised it took them so long to regulate the digital market

 

[Mrkevinfinnerty]

Spotify is just making a whole lot of noise to cover up the fact that they don’t really have a viable business model to begin with. Nor should Apple be expected to prop them up, and I don’t see why Spotify should be allowed to amass a huge subscriber base on iOS, using Apple’s platform and infrastructure, without paying for access.

This is what it all comes down to - the equivalent of jumping the turnstile at the train station. Spotify wants all the benefits of operating in the App Store, without having to pay a single cent in return.

And they still aren’t profitable.

Spotify should just close down.

Or Apple could shutter Apple Music so they aren't a competitor anymore. It looks like they've given up on it already honestly, they should just put it out of it's misery.

 

[Abazigal]

I really think a lot of this would go away if they just lowered their cut. It really is ridiculous that they think 30% is an acceptable margin for the service apple provides. It's practically free money to them. And when the EU forces side loading, it's going to cause a headache for all of us when many major players bail from the App Store in order to get a larger cut.

What's a fair percentage then? 15%? 10%? Who decides, and what makes said number any more fair than the existing 30%?

After all, platforms like Nintendo still charge 30% for games sold via their platform, and nobody seems to have an issue with it.

 

[applesith]

https://ec.europa.eu/commission/presscorner/detail/en/IP_23_4328

https://www.europarl.europa.eu/news...arkets-act-and-digital-services-act-explained

How does the EU propose this actually to happen? It's easy to label an organization as a "gatekeeper" but what are they supposed to do other than shutdown parts of their business?

 

[redbeard331]

C’mon Spotify guy, don’t hate the player, hate the game.

 

[Unregistered 4U]

I really think a lot of this would go away if they just lowered their cut. It really is ridiculous that they think 30% is an acceptable margin for the service apple provides. It's practically free money to them. And when the EU forces side loading, it's going to cause a headache for all of us when many major players bail from the App Store in order to get a larger cut.

No, everyone not agreeing with the cut are just bad at business. They won’t be happy until Apple is not taking any cut at all because they’re unable to make a profit from a 70% cut. Meanwhile, hundreds of thousands of developers that are GOOD at business are making a significant amount of money.

 

[dukebound85]

says who spotify?

 

[klasma]

How does the EU propose this actually to happen? It's easy to label an organization as a "gatekeeper" but what are they supposed to do other than shutdown parts of their business?

It's explained in the pages I linked: "Following their designation, gatekeepers now have six months to comply with the full list of do's and don'ts under the DMA, offering more choice and more freedom to end users and business users of the gatekeepers' services."

If you're truly interested, there are plenty of articles discussing this online.

 

[zach-coleman]

What's a fair percentage then? 15%? 10%? Who decides, and what makes said number any more fair than the existing 30%?

After all, platforms like Nintendo still charge 30% for games sold via their platform, and nobody seems to have an issue with it.

The economics of making a game are much different than the economics of making an app. Video game consoles are also not in the same class of item as a phone or a computer when it comes to how required they are for daily life. This being said, Nintendo’s cut is also too high. That was easy, huh?

I’m not saying there is a legally mandated cut that needs to be out there, I’m saying the more a cut they demand the worse they look to any given person involved in cases where apple gets sued or challenged by legislation. If their cut was 5%, do you think the Epic case would have gone as far as it did? I lean more towards 10% or 15% personally, though.

 

[Abazigal]

Or Apple could shutter Apple Music so they aren't a competitor anymore. It looks like they've given up on it already honestly, they should just put it out of it's misery.

My point being - these are 2 separate matters.

Spotify has had years prior to Apple Music being released to be profitable. They knew iOS would take a 30% cut of subscriptions, they should have factored this into their pricing strategy. They have hundreds of millions of subscribers around the world, not all of them are on iOS, they have claimed to have succeeded in moving the majority of them away from iTunes billing, and Spotify is still not making any money.

It's all a red herring to distract from the fact that Spotify never had a viable business model to begin with. Apple can remove the 30% commission (for the small percentage of users still paying through iTunes), Apple can let users sideload whatever custom app Spotify wants to push through, Apple Music could disappear from the face of the earth tomorrow, and they still won't be profitable, and it's not going to save them when their investor funding finally does run out.

Spotify should never have existed in the first place.

 

[scorpio vega]

Very true.

Also Apple Music is very very bad.

I disagree.

 

[raindogg]

How about Spotify, Apple, and Google pay the artist more? Let's start there, enough with these F'n board members, PAY THE ARTIST!!!

 

[Abazigal]

I lean more towards 10% or 15% personally, though.

Subscriptions are 15% after the first year.

 

[Nozuka]

No, everyone not agreeing with the cut are just bad at business. They won’t be happy until Apple is not taking any cut at all because they’re unable to make a profit from a 70% cut. Meanwhile, hundreds of thousands of developers that are GOOD at business are making a significant amount of money.

Not sure you thought that one through. That money needs to come from somewhere.

 

[sw1tcher]

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

Au contraire. Spotify, like Netflix, could offer sales of their service outside of the the App Store and not pay the 30%. There are many businesses that have apps on the Apple App Store that do not offer financial transactions through the store.

You cannot sign up for Spotify Premium through the app

Can’t subscribe to Premium in the iOS app - Spotify

support.spotify.com

You get a message (You can't upgrade to Premium in the app. We know, it's not ideal.) if you try, so Apple isn't getting any cut of Spotify subscription... unless it's different in the UK. You have to log in to your Spotify account with a web browser and enter a payment method there.

 

[applesith]

It's explained in the pages I linked: "Following their designation, gatekeepers now have six months to comply with the full list of do's and don'ts under the DMA, offering more choice and more freedom to end users and business users of the gatekeepers' services."

If you're truly interested, there are plenty of articles discussing this online.

None of those links explain how this is actually practiced. The linked resources only explain the why, the fees, and vague do's like "allow their business users to access the data that they generate in their use of the gatekeeper’s platform" which is easier said than done and contradicts GDPR.

This is typical politicians dictating what they want to be done while they have no meaningful experience in actually starting or running a successful business in the real world.

 

[Ricebucket]

What's a fair percentage then? 15%? 10%? Who decides, and what makes said number any more fair than the existing 30%?

After all, platforms like Nintendo still charge 30% for games sold via their platform, and nobody seems to have an issue with it.

The question you ask is Economics 101 and is exactly the topic at hand here.
In a fair market, the market allocates resources efficiently and determines the appropriate market price.
In certain situations, such as a market skewed by an anti-competitive monopolist, the market cannot function. This is the key question here.

Your second line sounds like an argument Apple wants to make. But I think Spotify and Epic would argue that video game consoles are a fundamentally different market with different business models where the hardware manufacturer takes a loss on the hardware to make money on the software.

 

[Fuzzball84]

You would be surprised about the rules we have here. No vacuum cleaning between noon and 2 pm and not at all on Sundays, you are technically not allowed to throw away glass bottles after 7 pm and your dog is (again technically) only allowed to bark 30 minutes per day, not after 10 pm and only 10 minutes at a time oh and of course it’s illegal to clean your car on your property. I am actually surprised it took them so long to regulate the digital market

In Brexit Britain we have so many rules that you now spend 5 days of the working week filling in forms. The Saturday is spent trying to figure out how to reclaim the lost growth caused by Brexit, over tea and crucumber sandwiches. That gives you a Sunday left over, but it's a day of rest while listening to Spotify... so essentially every week is unproductive.

And they also like to cancel things too... like building half a railway line... someone should have told them to lay down one side of the track all the way to Manchester... at least we would have had a monorail :/

 

[rjp1]

Very true.

Also Apple Music is very very bad.

I agree with them.

I use Apple Music and like it. My only negatives about it are that Siri messes up when I request songs, but that is more of a general problem with Siri and not Apple Music. I'm curious why you think Apple Music is bad?

 

[Unregistered 4U]

Spotify is just making a whole lot of noise to cover up the fact that they don’t really have a viable business model to begin with.

That’s essentially what it comes down to. The ONLY way they’ll exist in the future is if they can renege on their prior business agreements, including those with Apple, artists, everyone. They entered into business with the “if I get big enough I win” mindset with no regards to profits.

Huh… interesting that Epic, also with money problems, wants a reduction of the fees… another company known to be following the “give millions away for free and I’ll eventually make money” teachings.

 

[Red Oak]

What is insane is that Spotify has never produced an annual profit in the 15 years since its launched. Never. Yet here is this clown pontificating like a ****ing child

At a $30 billion market cap, it is becoming an interesting short opportunity

 

[GuruZac]

I use both Apple Music and Spotify. I prefer certain features of each platform.

Can Spotify not just have a free app on the store with the commercials, then sell plans separately on their website? I thought they were already requiring users to go to their website to upgrade plans any way. What 30% is Apple getting? I genuinely have no idea how any of it works.

 

[sw1tcher]

Spotify is just making a whole lot of noise to cover up the fact that they don’t really have a viable business model to begin with. Nor should Apple be expected to prop them up, and I don’t see why Spotify should be allowed to amass a huge subscriber base on iOS, using Apple’s platform and infrastructure, without paying for access.

Easy solution: allow iDevice users to bypass Apple's Apple Store and sideload install apps off the web, you know, like how we can on macOS, Windows, etc.

Hey, Apple let app developers like coconutBattery amass a huge subscriber base on macOS without any problem.

This is what it all comes down to - the equivalent of jumping the turnstile at the train station. Spotify wants all the benefits of operating in the App Store, without having to pay a single cent in return.

Is Spotify really saying they shouldn't have to pay a single cent to Apple? Got a source?

 

[Fuzzball84]

What is insane is that Spotify has never produced an annual profit in the 15 years since its launched. Never. Yet here is this clown pontificating like a ****ing child

At a $30 billion market cap, it is becoming an interesting short opportunity

Yeah, it's pretty amazing. But its amazing how many companies never actually make a profit... and seem to keep going and going and going....