Apple hit with $2bn EU fine over silencing music-streaming rivals like Spotify on its platforms

Apple Inc. has been hit with a €1.8 billion ($2 billion) penalty from the European Union over an investigation into allegations it silenced music-streaming rivals, including Spotify Technology SA, on its platforms. 

The European Commission also ordered the Cupertino, California-based firm to stop preventing music-streaming apps from informing users of cheaper deals away from Apple’s App Store. 

“For a decade, Apple abused its dominant position in the market for the distribution of music streaming apps through the App Store,” EU antitrust chief Margrethe Vestager said. “They did so by restricting developers from informing consumers about alternative, cheaper music services available outside of the Apple ecosystem.”

Apple rejected the EU’s fine, saying in a statement that regulators failed to “uncover any credible evidence of consumer harm, and ignores the realities of a market that is thriving, competitive, and growing fast.”

Apple reported revenue of $119.6 billion in the first quarter, including $69.7 billion from the iPhone alone, with sales from the device up 6% from a year ago. 

Vestager has made it a core strategy to attempt to dismantle Big Tech’s dominance in the bloc through fines and regulatory actions. She slapped Alphabet Inc.’s Google with penalties of more than €8 billion and also ordered Apple to repay €13 billion in allegedly unfair tax breaks from Ireland. 

The EU crackdown on Apple’s App Store has run alongside sweeping new rules aimed at heading off market abuses before they take root. Under the Digital Markets Act, which comes into full effect this week, it’ll be illegal for the most powerful tech firms to favor their own services over their rivals. 

Companies will be barred from combining personal data across their different services and from using data they collect from third-party merchants to compete against them. They will also have to allow users to download apps from rival’s platforms. The rules come into full force March 7 and Apple has also challenged its designation under the new regime.   

The EU’s investigation was sparked by a complaint nearly five years ago from Spotify, which claimed it was forced to ramp up the price of its monthly subscriptions to cover costs associated with Apple’s alleged stranglehold on how the App Store operates. 

The European Commission homed in on Apple’s so-called anti-steering rules in a formal charge sheet in February, saying the conditions were unnecessary and meant customers faced higher prices.

Subscribe to the new Fortune CEO Weekly Europe newsletter to get corner office insights on the biggest business stories in Europe. Sign up for free.

Source link

About The Author

Scroll to Top