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European Commission has Fined Apple over €1.8 Billion over Anti-trust Violations
Some sites are reporting on the European Commission's enforcement of anti-trust regulations against Apple over their abuse of their app store. The European Commission has fined Apple over €1.8 billion for abuse [europa.eu] of its app store for having placed restrictions over the last decade on app developers to prevent them from even informing iOS users about alternative, cheaper music subscription services, a restriction which is illegal.
Apple has been hit with a fine of €1.84 billion (about $2 billion) by European Union antitrust regulators over its App Store rules, and has been told it cannot stop music services from advertising cheaper subscription deals outside of Apple’s store. News of today’s fine was earlier reported by the Financial Times, and comes ahead of Apple’s huge shakeup of the iPhone’s app distribution rules due to the EU’s Digital Markets Act.
- Apple hit with first-ever EU fine following Spotify complaint [theverge.com], The Verge
Deezer has issued a statement praising the European Commission’s $1.95B+ fine for Apple breaking antitrust rules. However, it says the company’s newly implemented rules are aimed at circumventing the spirit of the Digital Markets Act.
- Deezer Says the EU $1.95B Fine Isn't Enough to Reign in Apple [digitalmusicnews.com], Digital Music News
The fine originates in a legal complaint filed with the European Commission by Spotify in 2019, challenging the restrictions and fees Apple places on developers listing their apps in the App Store. Today the European Commission agreed, saying that Apple’s App Store restrictions amount to unfair trading conditions that may have led iOS users to pay significantly higher prices for music streaming subscriptions.
“For a decade, Apple abused its dominant position in the market for the distribution of music streaming apps through the App Store,” said Margrethe Vestager, the EU’s competition chief, in a statement. “They did so by restricting developers from informing consumers about alternative, cheaper music services available outside of the Apple ecosystem.”
- Apple Fined $2 Billion as Europe Sides With Spotify [wired.com], Wired
“This is illegal and it has impacted millions of European consumers,” Margrethe Vestager, the EU’s European Commissioner for Competition, said at a press conference. European users do not have “a free choice as to where, how and at what prices to buy music streaming subscriptions.”
- Apple Slapped With $2 Billion Fine for Ripping Off Music Customers [gizmodo.com], Gizmodo
Since introducing the App Store in 2008, Apple has run it largely the same way across 175 countries, right down to the 30 percent commission it has collected on every app sold.
The company calls the result an economic miracle. The store has generated more than $1 trillion in sales, helped create more than seven million jobs and delivered Apple billions of dollars in annual profits.
- How Regulations Fractured Apple’s App Store [nytimes.com], The New York Times
"This is illegal, and it has impacted millions of European consumers," Margrethe Vestager, the EU's competition commissioner, said at a news conference.
Apple behaved this way for almost a decade, which meant many users paid "significantly higher prices for music streaming subscriptions," the commission said.
The 1.8 billion-euro fine follows a long-running investigation triggered by a complaint from Swedish streaming service Spotify five years ago.
- Apple Fined Nearly $2 Billion by European Union Over Music Streaming Competition [voanews.com], Voice of America
The European Commission's decision was triggered by a 2019 complaint by Swedish music streaming service Spotify over this restriction and Apple's 30% App Store fees.
The European Union competition enforcer said Apple's restrictions constituted unfair trading conditions, a relatively novel argument in an antitrust case and also used by the Dutch antitrust agency in a decision against Apple in 2021 in a case brought by dating app providers.
- apple eu $2 billion fine: Apple-Spotify case: EU slaps nearly $2 billion fine on tech giant [indiatimes.com], The Economic Times of India
EU antitrust chief Margrethe Vestager will hold a press conference on a competition case at 1200 GMT, the European Commission said on Monday without providing details.
She is likely to announce a fine and an order to iPhone maker Apple to allow Spotify and other music streaming services inform users of options outside Apple's App Store, sources close to the matter said.
- margrethe vestager news conference: EU antitrust chief Margrethe Vestager to hold news conference, Apple in focus [indiatimes.com], The Economic Times of India
Apple – which said it contests the decision – behaved this way for a decade, resulting in “millions of people who have paid two, three euros more per month for their music streaming service than they would otherwise have had to pay,” she said.
The €1.8 billion fine follows an investigation triggered by a complaint from Swedish streaming service Spotify five years ago. Since then, the EU has drawn up new regulations taking effect this week to prevent tech giants from cornering digital markets.
- European Union fines Apple 1.8 billion in first antitrust penalty [csmonitor.com], The Christian Science Monitor
Apple's anti-steering rules have prevented developers from directing users outside the App Store – thereby circumventing Apple's 30 percent commission – for in-app purchases and subscriptions. As part of the EC decision, Apple is being forced to end the use of anti-steering provisions in the bloc, but this restriction applies only to music streaming apps, an EC spokesperson told The Register.
Vestager described Apple's anti-competitive conduct as having gone on for nearly a decade, resulting in iOS users paying "significantly higher prices for music streaming subscriptions." The anti-steering provisions also led to a "degraded user experience," Vestager said, as users were forced to "engage in a cumbersome search" to find cheaper prices outside the App Store because the anti-steering rule also prevented developers from telling users about cheaper prices available elsewhere.
- EU fines Apple nearly $2B over in-app purchases [theregister.com], The Register
Apple on Monday was fined 1.8 billion euros ($1.95 billion) by European Union regulators for thwarting competition among music streaming rivals, a severe punishment levied against the tech giant in a long-simmering battle over the powerful role it plays as gatekeeper of the App Store.
The penalty, announced by the E.U. antitrust regulator, is the culmination of a five-year investigation set in motion by one of its biggest rivals, Spotify. Regulators said Apple illegally used its App Store dominance to box out rivals.
- Apple Fined $2 Billion by E.U. for Using App Store to Thwart Competition [nytimes.com], The New York Times
The European Commission decided to fine the company after finding that its anti-steering rules may have led iOS users to pay significantly higher prices for music streaming subscriptions. Additionally, officials determined the provisions caused “non-monetary harm in the form of a degraded user experience.” Because developers can’t include a link to external purchase options in their apps, users have to search manually for those purchase options.
- EU fines Apple €1.84B over App Store's anti-steering rules [siliconangle.com], Silicon Angle
EU antitrust chief Margrethe Vestager will hold a press conference on a competition case at 1200 GMT, the European Commission said on Monday without providing details.
She is likely to announce a fine and an order to iPhone maker Apple to allow Spotify and other music streaming services inform users of options outside Apple's App Store, sources close to the matter said.
- Apple: EU antitrust chief Vestager to hold news conference, Apple in focus [indiatimes.com], The Economic Times of India
The European Commission said it "found that Apple applied restrictions on app developers preventing them from informing iOS users about alternative and cheaper music subscription services available outside of the app".
"This is illegal under EU antitrust rules," the EU's powerful antitrust regulator said.
- EU slaps Apple with €1.8 billion fine for music streaming restrictions [france24.com], France 24
Apple is one of six major companies that have to comply with new EU competition regulations under the Digital Markets Act (DMA) by March 6.
Besides Apple, the EU has launched several antitrust proceedings against large tech companies, including a probe into Microsoft over its packaging of the messaging app Teams.
- EU hits Apple with €1.8 billion antitrust fine [dw.com], Deutsche Welle
The European Union has imposed a 1.8 billion-euro fine on Apple, marking the company's first antitrust penalty from Brussels, following allegations of limiting competition by restricting music streaming services from offering alternative subscription options.
The EU competition enforcer said Apple’s restrictions constituted unfair trading conditions, a relatively novel argument in an antitrust case and also used by the Dutch antitrust agency in a decision against Apple in 2021 in a case brought by dating app providers.
- Apple slammed with €1.8-billion EU antitrust fine [techcentral.co.za], Tech Central
It goes without saying that Apple will appeal and this case will drag on.
