The EU Commission has imposed a competition fine of 1.8 billion euros on the US tech giant Apple. The authority in Brussels said the company abused its dominant market position by selling music streaming apps to iPhone and iPad users via its app store.
Apple imposed restrictions on app developers that prevented them from informing users about other and cheaper music subscription services. “This is illegal under EU antitrust rules,” argues the Commission.
The music streaming service Spotify and Apple have been arguing for years. Apple charges other providers a 30 percent fee if they sell subscriptions or other payment services through Apple’s App Store. For subscriptions that last longer than one year, the fee drops to 15 percent. Spotify thinks this is unfair. Apple, on the other hand, argues that a large part of Spotify’s success is thanks to Apple’s App Store. According to Apple, Spotify does not pay Apple any money because it sells subscriptions outside of the app.
In January, Apple presented alternatives for its app business in the EU. This includes reducing the tax on the sale of digital items and subscriptions via the in-house app store. The previous 30 percent and 15 percent for subscriptions from the second year onwards will become 17 and 10 percent respectively. However, Apple emphasizes that this share should be collected regardless of which payment service an app developer uses. If an app uses Apple’s payment system, an additional three percent is due.
The EU Commission has been eyeing American technology platforms critically for years. Fines amounting to billions of dollars have been imposed on Google alone. The Commission also justifies the current billion-dollar fine by saying that Apple provided incorrect information in the administrative procedure and that the amount should be a deterrent.