Apple has recently been embroiled in a dispute with Spotify over competition complaints, particularly in relation to the Digital Markets Act (DMA) set to be enforced in the EU in early March. The DMA aims to ensure fair and open digital markets, as stated by the European Commission.
Apple has taken a firm stance against Spotify, following reports that the EU may impose a hefty €500 million fine on Apple after investigating Spotify's allegations of anti-competitive behavior related to Apple's App Store rules.
To comply with the DMA, Apple has announced significant changes to its iPhone's iOS software, including allowing alternative marketplaces. However, some companies have expressed discontent with the updated iOS rules, which now require app developers in rival marketplaces to pay a Core Technology Fee of $0.54 for each download after the first million.
Apple argues that these costs are justified as it provides infrastructure for apps to function securely and in a maintained environment. Spotify, with its 236 million paid subscribers, has raised concerns about the financial implications of these download costs.
In response to Spotify's criticisms, Apple emphasized its support for all developers, including Spotify, highlighting the benefits the music streaming app has gained from being on the App Store. Apple pointed out that Spotify pays nothing for the services that have facilitated its app's reach to users in 160 countries.
One of the key issues raised by Spotify is its objection to paying commissions to Apple when users sign up for its paid service through the iOS app. While Apple allows 'Reader apps' to link to external websites for account management, signing up for paid accounts within iOS incurs a commission fee.
Despite the benefits Spotify has derived from the App Store, including over 119 billion downloads, the company has underscored the costs associated with Apple's policies. Apple, on the other hand, contends that its response to the DMA is fair and comprehensive.
With Spotify holding a significant market share in the EU streaming industry compared to Apple Music, the differences of opinion between Apple and Spotify are likely to persist as the DMA enforcement approaches.
