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Why Spotify Called Apple’s App Store Rules Anti-Competitive

The European Commission found Apple’s App Store rules for music-streaming services breached EU competition law and fined the company €1.84 billion. Spotify welcomed the finding; Apple disputed it and said it would appeal.
From TheFinanceBase Team3 min to read
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Spotify welcomed a European Commission decision that found Apple’s App Store rules for music-streaming services breached EU competition law. The Commission fined Apple €1,840,984,000 on March 4, 2024, over rules that restricted how streaming providers could tell iOS users about subscription offers outside their apps. Spotify said those restrictions undermined consumer choice; Apple rejected the Commission’s finding and said it would appeal.

What the European Commission decided

The Commission’s March 4, 2024 decision concerned Apple’s App Store rules for music-streaming providers on iOS. It found that Apple’s anti-steering provisions—rules limiting providers’ ability to inform users about subscription options available outside an app—amounted to unfair trading conditions and infringed EU competition law. The legal basis included Article 102(a) of the Treaty on the Functioning of the European Union, which addresses the imposition of unfair trading conditions by a company in a dominant position. The Commission’s announcement summarizes the decision; the full decision sets out the legal reasoning.

The rules at issue covered in-app purchases of paid digital content as well as restrictions on directing users toward subscription offers outside the app. The Commission’s concern was that users could not readily receive information needed to make an informed choice about available subscriptions. Its decision states: “Under Article 102(a) of the Treaty, the direct or indirect imposition by an undertaking in a dominant position of unfair trading conditions constitutes an abuse of that position.”

What the fine represents

The Commission set Apple’s fine at €1,840,984,000. In the decision, that total consists of €40,984,000 calculated under its general methodology and an additional €1,800,000,000 lump sum. These are components of the fine imposed in this particular case, not a recurring charge.

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Why Spotify objected to Apple’s rules

Spotify was the complainant in the case and welcomed the Commission’s finding. In its March 4, 2024 statement, it said: “The European Commission (EC) has made its conclusion clear: Apple’s behaviour limiting communications to consumers is unlawful.” That was Spotify’s description of the outcome, not a substitute for the Commission’s legal finding.

Spotify said the restrictions prevented it from communicating practical subscription information to iOS users in its app, including prices, upgrade details, promotions, discounts, and other ways to subscribe. Spotify’s argument was that users could not easily compare options if a service could not explain those offers or point them to an alternative purchase route. Those claims describe Spotify’s view of the rules’ effects; the legal conclusion belongs to the Commission.

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How Apple responded

Apple disputed the decision, defended its App Store policies, and said it would appeal. Apple argued that the Commission had not produced credible evidence of consumer harm and maintained that the App Store helped Spotify grow. It also said Spotify paid Apple nothing because Spotify sold subscriptions through its website, and characterized Spotify as seeking more favorable App Store rules. These are Apple’s arguments, not findings by the Commission.

Apple’s March 4 statement said: “No evidence of anti-competitive behavior: Eight years of investigations have never yielded a viable theory explaining how Apple has thwarted competition in a market that is so clearly thriving.” The Commission nevertheless made a formal infringement finding in its decision; Apple’s stated disagreement does not erase that finding.

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Market figures need attribution

Apple cited figures to support its view that the European digital-music market had grown and remained competitive. Its March 4, 2024 statement said Spotify held 56 percent of Europe’s music-streaming market. Apple also said the market had grown over eight years from 25 million subscribers to almost 160 million subscribers, with more than 300 million active listeners, and that Spotify had met with the Commission more than 65 times during the investigation. These are figures and claims Apple supplied, not independent Commission statistics established by the decision.

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What EU iPhone users could see in Spotify’s app

In an August 14, 2024 update, Spotify said it was opting into Apple’s music-streaming entitlement for the EU. Spotify said this let EU iPhone users see pricing information and a direction to Spotify’s website, while a clickable purchase link remained unavailable under Apple’s terms as Spotify understood them then. That is a dated account of the app flow in August 2024; it does not establish what users can see or do in the app today.

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How this relates to the Digital Markets Act

Apple’s later obligations under the EU Digital Markets Act are related context, but they are distinct from the March 2024 music-streaming antitrust decision. Apple’s DMA information page says the European Commission designated Apple a gatekeeper for iOS, the App Store, and Safari on September 5, 2023, and for iPadOS on April 29, 2024. Those designation dates do not change what the Commission decided in the separate case concerning music-streaming rules.

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