EU fines Apple for nearly $2B following Spotify’s complaint

The European Union Commission has fined Apple €1.84 billion ($2 billion) for abusing its dominant position in the market for the distribution of music streaming apps to iPhone and iPad users through its App Store. This is the first EU fine for the iPhone manufacturer.

• The company was accused of preventing Spotify and other music streaming services from informing users of alternative payment methods besides the App Store. The fine consists of two parts: a basic amount of €40 million and an additional €1.8 billion, which will serve as a deterrent. The total fine of €1.84 billion, which is 0.5% of Apple’s global turnover.
• Apple criticized the EU’s decision, saying it would challenge it in court. The decision of the court in Luxembourg, the second most important court in Europe, is expected to take several years to process the complaint. Until then, Apple will have to pay the fine and comply with the EU order.

• The European Commission’s decision was based on a complaint by the Swedish music streaming service Spotify in 2019. The complaint was filed because of restrictions imposed by Apple and the App Store’s 30% commission. The EU regulator also said Apple’s restrictions create unfair trading conditions.

Details of investigation:

The European Commission opened a formal investigation into Apple’s rules for app developers in June 2020. These rules apply to the distribution of applications through the App Store. Margrethe Vestager, the European Competition Commissioner, said it was the first time the commission had added an additional amount to an antitrust fine as a deterrent.

Millions of European music streaming users are left in the dark about all the options available. In addition, Apple’s anti-stealth rules have forced consumers to pay more for such services due to the high fees imposed on developers and passed on to consumers,

the EU Commission explained.

Apple said Spotify doesn’t pay Apple a fee because it sells its subscriptions from its website, not the App Store. Spotify, in its part, welcomed the EU’s decision, but said there were other problems in other areas.