The EU has updated its antitrust case against Apple and its control over music streaming services on iOS with possible good news for plaintiff Spotify.
The European Commission, the EU body investigating the allegations, says Apple has violated antitrust laws by barring rival music companies like Spotify from advertising where and how users can subscribe to their apps. This update to the case does not constitute a final ruling, and it is now up to Apple to mount a defense and prove the allegations false.
Spotify first filed a complaint against Apple in 2019, with the European Commission a research in 2020. The Commission issued a first “Statement of Objections” against Apple in 2021, outlining potential antitrust violations. The Commission focused on two issues: that Apple forced developers to use its own in-app payment system for which it collects a fee (the “IAP Obligation”), and that Apple prevented developers from advertising alternative ways to subscribe to their apps (the “Anti-Steering Obligations”).
Today the Commission has updated this Statement of Objections. It has dropped the first charge, saying it “no longer takes a position on the legality of the IAP obligation,” and is targeting the second. The Commission has also strengthened its language on this charge by issuing a “preliminary opinion” that “Apple’s anti-steering obligations constitute unfair trading conditions in violation of Article 102 of the Treaty on the Functioning of the European Union (“TFEU” ).”
For a while, Apple didn’t allow rival streaming services like Spotify to even include links in the company’s apps to their own subscription logins. (Apple relaxed this restriction in March 2022 to close an antitrust investigation in Japan.)
If found guilty, Apple could be fined up to $39.4 billion
Apple can now respond to the EU’s charges. If found guilty, the company risks a fine of up to 10 percent of its annual global turnover. That would be a fine of up to $39.4 billion based on Apple’s 2022 revenue of $394.33 billion. We’ve reached out to the company for comment and will update this story if we hear back.
In a statement from Spotify, Eve Konstan, general counsel for the company, said: “Today the European Commission has sent a clear signal that Apple’s anti-competitive behavior and unfair practices have penalized consumers and aggrieved developers for far too long. We urge the Commission to take a swift decision on this matter to protect consumers and restore fair competition to the iOS platform.”
Last month, Spotify and other European companies urged the Commission to speed up its investigation and take “swift and decisive action” against Apple. (Although the Commission notes in its own announcement today “there is no legal time limit for ending an antitrust investigation”.) If the case is delayed much longer, the case is also likely to encounter a whole new set of liabilities, Apple and others will have to comply with the forthcoming Digital Markets Act or DMA of the EU. These will force Apple to allow third-party app stores and app sideloading on iOS for the first time.
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