Apple’s 30% app store commission unfair, Spotify claims | Technology

Spotify has filed a complaint with European regulators arguing that Apple limits choice and competition in its app store, giving its own music streaming service an unfair advantage over rivals.

Apple’s app store is an important distribution platform for Spotify. But Apple takes a 30% commission on all sales made through the app store – including music streaming subscriptions – which Spotify and many other third-party app developers have long complained is an unfair “tax”.

“Apple requires that Spotify and other digital services pay a 30% tax on purchases made through Apple’s payment system, including upgrading from our free to our premium service,” said Daniel Ek, Spotify co-founder and chief executive, in a blog post.

“If we pay this tax, it would force us to artificially inflate the price of our premium membership well above the price of Apple Music. And to keep our price competitive for our customers, that isn’t something we can do.”

Spotify ran an ad campaign in 2016 to try and get users to sign up for its premium service directly on its own site, bypassing the app store.

However, Ek said he has now been forced to officially lodge a complaint with the European commission after Apple introduced what he claimed were wider anti-competitive practices that has made it “both player and referee to deliberately disadvantage other app developers”.

Daniel Ek, Spotify co-founder and CEO

Daniel Ek, Spotify co-founder and CEO: ‘Apple has introduced rules to the app store that purposely limit choice.’ Photograph: Shannon Stapleton/Reuters

He said that if Spotify chooses not to use Apple’s payment system, to avoid paying the commission, the company applies “a series of technical and experience-limiting restrictions” on consumers running its streaming service on the rival tech company’s devices.

Examples cited include limiting communications with Spotify customers and “routinely” blocking app upgrades.

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“In recent years, Apple has introduced rules to the app store that purposely limit choice and stifle innovation. They continue to give themselves an unfair advantage at every turn,” Ek said. “After trying unsuccessfully to resolve the issues directly with Apple, we’re now requesting that the European commission take action to ensure fair competition.”

Spotify argues that its complaint to regulators is not about seeking “special treatment” in its global music battle against Apple but the same treatment as numerous other apps such as Uber and Deliveroo, which are not subject to the 30% app store charge.

“This is not a Spotify vs Apple issue,” he said. “We should all be subject to the same fair set of rules and restrictions, including Apple Music.”

Apple had not responded to a request for comment at the time of publication.

Spotify is also challenging a ruling in the US that would result in it having to increase its royalty payments to songwriters by more than 40%.

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