Spotify is filing a complaint against Apple with the European Commission
Spotify is filing a complaint against Apple with the European Commission; the streaming coloss is accusing the latter company of anticompetitive behaviour in the way it manages its App Store, and thus gives its own Apple Music streaming service an advantage.
Spotify held a conference call with journalists yesterday and general counsel Horacio Gutierrez stated:
This is not about picking a fight. this is not about Spotify versus Apple. but we also believe we have no other choice. This is about protecting competition for both businesses and consumers, because Apple’s actions are in violation of the law and we are convinced they will hurt consumer choice and innovation in the long term...
Apple uses its complete control over access to its App Store to deprive consumers of choice and disadvantage rival providers of audio streaming services, in particular Spotify, to the benefit of Apple’s own streaming service, Apple Music.
Gutierrez also claimed that Apple's restrictions on Spotify became "more frequent and more extreme" after the company acquired Beats Electronics (including its Beats Music streaming service) in 2014, and then relaunched the latter as Apple Music in 2015.
He added that Spotify had been "pressured" into using Apple's in-app purchases system in 2014, forcing the company to increase the cost of an iOS Spotify subscription to $12.99 a month to factor in Apple's 30% cut – thus disadvantaging Spotify when Apple Music launched for $9.99 a month.
Gutierrez also talked more about the restrictions Spotify claims have been placed on it since it dropped in-app purchases on iOS:
Apple's rules dictate that we’re no longer to communicate with our own customers about what we consider to be pretty important stuff. We can’t even tell our users to get Premium, or give them tips on other ways in which they can upgrade outside the iOS platform. Apple has gone as far as prohibiting Spotify from emailing our users about ways they can subscribe to our Premium service.
Gutierrez confirmed that Spotify has submitted an "economic analysis" to the European Commission showing the impact it believes Apple's policies have had on its business. "We are confident that the evidence will show that even though we’ve been successful as a company, and have grown our business, we could have been even more successful if it were not for the restrictions that Apple has placed on our business," he said. Spotify is not making this economic analysis public for now.
Apple has yet to comment on the complaint.
The news means Spotify will have its hands full, legally, in the coming months. The company is already enmeshed in a row with music publishers in the US, over its decision to appeal against new royalty rates for songwriters set by the US Copyright Royalties Board. Plus there’s the small matter of the latest set of renewals of Spotify’s licensing deals with major labels, which are also due this year.