The European Union has imposed a €1.8 billion fine on Apple for violating competition laws in the music streaming sector. According to the European Commission, the tech giant was found to have restricted streaming services from directing users to payment options outside its App Store. Margrethe Vestager, the Competition Commissioner, highlighted Apple’s decade-long abuse of its market dominance, demanding the company eliminate these restrictions.
Apple, planning to challenge the ruling, insists on the absence of any consumer harm and critiques the Commission for not acknowledging the competitive and expanding nature of the market.
This legal action stems from a complaint by Spotify, the Swedish music streaming giant, over Apple’s 30% commission and payment restrictions. Vestager condemned Apple’s practice of limiting developers from informing users about more affordable music services beyond the Apple ecosystem, labelling it a breach of EU antitrust regulations. Apple, however, refutes these claims, emphasizing Spotify’s significant market presence and frequent engagements with the European Commission during the investigation.
Spotify welcomed the fine, interpreting it as a stern message against monopolistic behaviour, even from a company as influential as Apple. Apple countered by pointing out that Spotify does not incur any commission as it markets its subscriptions through its website, not the App Store. The dispute underscores Spotify’s concerns that Apple’s policies unfairly advantage its streaming service, Apple Music.
The backdrop of this legal battle is the EU’s Digital Markets Act (DMA), designed to foster competition and dilute the market dominance of tech giants like Apple and Google. The DMA mandates significant operational changes for these companies, threatening substantial fines for non-compliance. With a deadline looming for adherence to the DMA’s requirements, Apple, Meta, and TikTok are contesting certain aspects of the legislation.
Legal experts predict the DMA will significantly alter how designated platforms function within the EU, representing a robust yet blunt instrument against digital market concentration. Recently, Spotify and 33 other digital entities criticized Apple’s purported non-compliance with the DMA, arguing that the company’s new terms flout both the spirit and the letter of the law, undermining the DMA’s objective to stimulate competition in digital markets.
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