Spotify Files Complaint Against Apple With European Regulators Over 'Unfair' App Store Practices

[KevinN206]

Sorry Spotify, Apple has no obligation to host your app on their store for free

App developers have to pay $99/year so it's not free. Apple could always raise the fee to say $10,000/year for Spotify and it's still cheaper than charging 30% for every subscription. So no, it's not "for free."
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• "First, apps should be able to compete fairly on the merits, and not based on who owns the App Store. We should all be subject to the same fair set of rules and restrictions—including Apple"

Everyone has to pay 30%, not only Spotify. It's literally the same rule for everybody. But sure, Apple can pay itself 30% of the Apple Music revenue
If you want your service to be on iOS you have to play by App Store rules. It's just that simple. If they don't like it they should become an Android exclusive or just stop offering the subscription via IAP - I personally wouldn't care.

Apple does NOT follow the same rules. The rules are built to give Apple a home court advantage.

1. If Apple Music is $10/month, then they can show a subscription sign-up button in their app. Easy.
2. If Spotify wants the same subscription sign-up button, then they must agree to the 30% cut to Apple (15% after one year).
3. To be price competitive, Spotify must charge $10 and can have the subscription sign-up button in the app.
4. Spotify is prohibited from charging a *higher* price in the App Store to compensate for the 30% cut.
5. If Spotify does not want to pay the 30%, then they must remove all links and buttons to the subscription sign-up, so the subscription must be signed up from another source like a browser or the Android app.

 

[mrow]

Duopolies (in this case iOS and Android app stores) certainly are subject to anti-trust laws. Duopolies can very easily exhibit monopolistic behavior.

Except that isn’t the case here. Because what Spotify wants is for Apple to behave more like their platform competitor.
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Better still allow iOS users to CHOOSE Apple Music, Spotify, or a competitor to be he default music player ...you know like they once did with Microsoft a Internet Explorer back in early OS X days when they still shipped Netscape and Jobs stayed Apple believed in “choice”. That worked perfectly since Netscape died but the Gecko engine lives on and Safari was born. OS X allows for Chrome or Firefox to be the default browser. Should Spotify try something shady then they can pull it or disable it.

Apple doesn’t allow the default application to be changes for anything in iOS. Are you saying they should be forced to allow the default app to be changed just for music to benefit Spotify?

 

[sidewinder3000]

Thanks for the correction. I never checked to determine if it was ever changed. I was aware that the percentage is the same, at least in the beginning. So, it's just the first year of the subscription based model and then the reduction. I suppose this is an incentive and deterrence. However, 15% of subscriptions does still seem a bit higher than I would expect. Although, this only accounts for a percentage of those subscribing who keep it into the 13th month and beyond. End your subscription, start another one at a later date, and I'm curious as to if this restarts the cycle which allows Apple to charge 30% again for another year. Multiply this by millions of users who start up and cancel subscriptions, then this can be quite a bit of revenue gained. This could perpetually grow to more than just the 30% for 12 months. The other problem not being addressed is the lack of developers being able to offer trials, promotional discounts for a period of time, and alternative means to easily pay for the subscription through the app. Developers can easily implement the ability for users to subscribe through the app and not the App Store. However, Apple will not allow this feature. I understand the position of Apple losing revenue from developers by curtailing it. But, it could be based upon gross usage of the platform and value to the developer. If the reasoning behind the percentage of sales is for payment processing and it is much more difficult on an Apple platform than others, then it unfairly causes user difficulty in having a choice which inhibits fair competition. Are AM subscribers being prohibited in the same manner on the other platforms it's launching on such as Google Home and Amazon Fire? Do you know if the 30% charge for in-app subscriptions is just for payment processing? I believe the complaint is not just by Spotify if you search around for other related news articles. They, above others, most likely had the resources to pursue it.

It’s def not just about payment processing. It’s about delivering customers, and what that is worth. All businesses set aside money for customer acquisition. Sometimes it’s a sales team, sometimes it’s advertising or marketing, etc. But whatever it is, it costs money to acquire customers. If someone comes to Spotify through Apple, what is that worth? Typically, retailers buy products wholesale and sell them for 20-50% more to make a profit. It is ABSOLUTELY F&%$#@! INSANE that all these people with zero business experience are whining that Apple should be delivering customers to other companies and not get compensated. Or get compensated at a rate they think is appropriate. Apple has created the best app marketplace in the world at great expense and effort, and it delivers tons of high quality customers with money to spend to app makers, and that is worth something. Companies need to figure out whether they think they can deliver as many customers to themselves via a website, sales, advertising, & PR for less than Apple would. If so, they should not use the Apple payment processing option. If not, then enjoy the massive number of customers the App Store is bringing them for only 30/15%.

 

[Smartass]

The best thing Apple fans can do is response is cancel any Spotify subscriptions. Hopefully though, very few of us are giving money to Spotify anyway. Apple Music is superior in every way IMHO.

Ahahahhahahahahahahhahahahaa

HE SAID APPLE MUSIC IS SUPERIR TO SPOTIFY! ahahahahahahhaa

Seriously, have you even tried spotify? I've been apple music user since 2015, and just two months ago got spotify account... Spotify is LIGHT YEARS ahead of apple music.

 

[jeremiah256]

You make socks. You are not some fly by night sock maker, you're pretty big. You want to sell your socks. The only stores in town where you can sell your socks are either Walmart or Target. After paying these stores to put up a poster of your socks on the bulletin board (because you're big enough to handle the shipping and payment processing yourself), they say either you let them process the payments for 30%, or they'll hide your sock poster in the baloney aisle. Oh, and they don't charge 30% for processing pants.

 

[Tech198]

Spotify tried this before didn't they ?

If Spotify doesn't like it, perhaps they should not put their app in the App Store.

Apple's rules... It IS about competing because Spotify can't charge tax, and Apple does.

 

[mrow]

Ahahahhahahahahahahhahahahaa

HE SAID APPLE MUSIC IS SUPERIR TO SPOTIFY! ahahahahahahhaa

Seriously, have you even tried spotify? I've been apple music user since 2015, and just two months ago got spotify account... Spotify is LIGHT YEARS ahead of apple music.

Wow cool. I’m happy for you that you like Spotify that much.

 

[hans1972]

I still don't understand why I cannot use Siri to play Spotify. Or on the HomePod.
While I love iOS, I hate that Apple is intentionally damaging their user base experience for those who chose to use a competitor product instead of their own.
Remember Apple, developers are the one who made you to what you are today. If they all pull out, you have nothing left.

Think about all the products that do not support Apple Music, Tidal or Deezer.

Should there be a legal requirement if you support one service of a certain type, you have to support all?

 

[Nieloz]

The best thing Apple fans can do is response is cancel any Spotify subscriptions. Hopefully though, very few of us are giving money to Spotify anyway. Apple Music is superior in every way IMHO.

Its inferior. In no way Apple Music is supported by so many devices as Apple Music.

 

[5232152]

Apple doing what Apple does again - total domination and try to eat in other markets with mediocre solutions. If you have the monopoly Apple has, you better act like you actually care about the users of the ecosystem.

Get your act together, Tim Apple

 

[hans1972]

Spotify is not demanding any such thing.
Developers already pay to have their app listed in the App Store. It’s part of the annual developer fee.
Apple wants a piece of something they have nothing to do with.

It is not uncommon in a business relation to have several ways you have to pay. Having a yearly fee + per transaction fee is extremely common esp. for companies that provide a market place.

The value Apple provides is a market place with access to customers.

The argument that they already pay a yearly fee, and therefore are exempt for paying per transaction fees is ludicrous.

 

[derekamoss]

Spotify is really going after Apple this week. This is on top of the Announcement of Free Hulu with Spotify $9.99 a month which IMO is an attack on their TV Event. Here is what I wrote about that in another thread.

Honestly I think this will fail. First of all because normally when Apple pushes something content related it is to help sell another existing product. Music and for the iPod. TV shows and Movies for iOS devices. The only reason they released Apple Music was to directly compete with Spotify and Groove music and they already had a good foot hold in with the Music Industry. Apple going into the Movie and TV industry makes no sense because it doesn't compliment any existing product line, unless they make it where you have to have an Apple TV to work on your TV which I think will be another point of failure. It's really just them freaking out and doing a knee jerk reaction to Hulu and Netflix and the fact they don't have the content catalog in place or a specific brand content that has a huge following, i.e. Marvel movies and TV shows.
Second Spotify and Hulu just announced the other day that if you Sign up for the 9.99 Spotify premium plan( which IMO is already a much better value then Apple music) you also get a free account to Hulu. It might be the one where you have to watch ADs but that's a really good value so why would you go with Apple? Another reason is Apple probably will only work on Apple devices where Spotify and Hulu work on any Device and for family's that have a mix of brand products its a huge win. I'm not an Apple hater and wish they would fail btw but this is one area where I just don't understand why they would even try.

 

[tridley68]

BOO HOO Spotify.

 

[H3LL5P4WN]

Apple owns the Mall, the developer gets to open a store that sells an app, the rent is 30% of your sales.

There aren't enough Shia Leboufs on the internet to give you the required applause for that analogy.
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so why would you go with Apple?

Say it with me.

*CLAP* Because *CLAP* Apple *CLAP* pays *CLAP* Artists. *CLAP*

 

[tann]

Seeing the support for Apple in this thread is horrible. It's such a black and white situation, Apple are abusing power and being unfair and anti-competitive.

 

[ipponrg]

Think about all the products that do not support Apple Music, Tidal or Deezer.

Should there be a legal requirement if you support one service of a certain type, you have to support all?

What you said makes no sense.

Apple develops the first party music app for 3rd party products. I am pretty sure those 3rd parties would embrace Apple Music if Apple wanted to develop or an easy integration point for them.

I am sure Spotify would integrate with HomePod/Siri if allowed, but Apple is fearful of it possibly cannibalizing Apple Music

 

[derekamoss]

There aren't enough Shia Leboufs on the internet to give you the required applause for that analogy.
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Say it with me.

*CLAP* Because *CLAP* Apple *CLAP* pays *CLAP* Artists. *CLAP*

And that's great for them but you have to realize probably 90% of the people don't know about that and don't care about that. All they care about is if they can get what they want when they want it. Napster, Kazaa, LimeWire, The Pirate Bay are a few examples of that. Don't get me wrong I think people should be paid for what they do, but for most of the population on Earth, they are in the state of I'm owed something and it's my right to take it and will go the illegal route because just why not. Before Spotify you the only option you had was buying the Music you knew you wanted and I don't know how Spotify pays artists but with out them people would have never found an artist they didn't know about. It might not come in money form from spotify but I guarantee you it has upped the revenue when it comes to merchandise and concert tickets because they are much more exposed.

 

[eltoslightfoot]

How does Spotify reconcile your offline iTunes library?

I don't know. I don't add my offline music too spotify. I see them as two separate products. If I want to listen to my offline music, I choose iTunes (or other mp3 player). Radio? Spotify...

 

[H3LL5P4WN]

And that's great for them but you have to realize probably 90% of the people don't know about that and don't care about that. All they care about is if they can get what they want when they want it. Napster, Kazaa, LimeWire, The Pirate Bay are a few examples of that. Don't get me wrong I think people should be paid for what they do, but for most of the population on Earth, they are in the state of I'm owed something and it's my right to take it and will go the illegal route because just why not. Before Spotify you the only option you had was buying the Music you knew you wanted and I don't know how Spotify pays artists but with out them people would have never found an artist they didn't know about. It might not come in money form from spotify but I guarantee you it has upped the revenue when it comes to merchandise and concert tickets because they are much more exposed.

Which is why you have to keep educating them.

Or in the case of illegal file sharing, if you're in the position to turn off network ports and report users to the authorities, do that too. *whistles while looking up at the ceiling*

 

[Stella]

They’re not unfair practices. They own the store - they make the rules.

Unfair practices - that's for the courts to decide.

Apple are free to make rules, within the local laws . If the EU rule in favour of Spotify, Apple will have to abide by the ruling, or cease offering those services within the EU - which they probably wouldn't do - given the size of the consumer base.

 

[nburwell]

Honestly I think this will fail. First of all because normally when Apple pushes something content related it is to help sell another existing product. Music and for the iPod. TV shows and Movies for iOS devices. The only reason they released Apple Music was to directly compete with Spotify and Groove music and they already had a good foot hold in with the Music Industry. Apple going into the Movie and TV industry makes no sense because it doesn't compliment any existing product line, unless they make it where you have to have an Apple TV to work on your TV which I think will be another point of failure. It's really just them freaking out and doing a knee jerk reaction to Hulu and Netflix and the fact they don't have the content catalog in place or a specific brand content that has a huge following, i.e. Marvel movies and TV shows.
Second Spotify and Hulu just announced the other day that if you Sign up for the 9.99 Spotify premium plan( which IMO is already a much better value then Apple music) you also get a free account to Hulu. It might be the one where you have to watch ADs but that's a really good value so why would you go with Apple? Another reason is Apple probably will only work on Apple devices where Spotify and Hulu work on any Device and for family's that have a mix of brand products its a huge win. I'm not an Apple hater and wish they would fail btw but this is one area where I just don't understand why they would even try.

I think Apple is starting to realize they need to start making their services available outside their own products. They just made Apple Music available on the Amazon Echo and they're working with TV manufacturers to have iTunes included on many smart TV's. Especially with iPhone sales declining, Apple should realize they need to focus on their services since that seems to be their most promising part of the business that could make them money (albeit not the cash cow that the iPhone was).

IMO, Spotify premium + Hulu is a fantastic deal. I'm not sure how/if Apple could top that. Especially when they have yet to release any of their original programming. Time will tell though.

 

[matc]

I love Apple for building the best products on this planet but I'm with Spotify on this one. The commercials are one thing but actively trying to keep Spotify to build a working Apple Watch app and putting other hurdles in the way "because they can" is just so poor. I had the naive view that Apple would win because they focus on making better products.
But maybe there's just too much pressure on Apple these days to keep playing fair.

 

[cshamis]

Apple has nearly a monopoly on U.S. smartphone revenue (including actual purchases on Apps made by U.S. folks). Is there really anywhere for U.S. smartphone app developers to go other than iOS? I do think this is a real issue and I suspect it is getting worse as U.S. becomes even more entrenched in the iOS ecosystem.

Last I checked, Apple is in third place behind Huwaii and Samsung. And the Google app store is a worthy alternative on those other platforms. That doesn't meet any kind of definition of a monopoly.

 

[derekamoss]

I think Apple is starting to realize they need to start making their services available outside their own products. They just made Apple Music available of Amazon Echo and they're working with TV manufacturers to have iTunes included on many smart TV's. Especially with iPhone sales declining, Apple should realize they need to focus on their services since that seems to be their most promising part of the business that could make them money (albeit not the cash cow that the iPhone was).

IMO, Spotify premium + Hulu is a fantastic deal. I'm not sure how/if Apple could top that. Especially when they have yet to release any of their original programming. Time will tell though.

That's exactly it, they don't have anything compelling to do so. Unless they come up with a plan for $9 a month and you get unlimited music, and all premium channels and unlimited TV shows and movies... But it won't happen because we have Tim Cook as CEO. No i'm not saying we need Steve but they need a CEO that isn't only worried about profit. It's not Tim's fault really either because he was a good CFO but he is still thinking like a CFO. He is a business man only and never had the passion to create great products and have the emotions that go with it. I'm pretty sure the only time Cook gets emotional about his iPad is when it breaks, un like the emotion that the people who built it have for it. Once again I'm not hating on him. He is doing an amazing job when it comes to finances but that's not what Apple needs.

 

[dumastudetto]

Its inferior. In no way Apple Music is supported by so many devices as Apple Music.

It's supported on all the devices us Apple fans use.

We don't care about Google smart spying speakers for example.