A famous music streaming service, Spotify complained to the European Commission about the actions of Apple. However, they complained that Apple was being unfair to other music streaming services.
The Financial Times reported that the European Commission is planning to give Apple a big penalty. This fine will be €500 million. The European Union found that Apple made it hard for other music services to compete.
EU Commission Takes Action Against App Store Rules
Spotify, complained to the EU in 2019, which is a music streaming service. They complained about the actions of Apple. However, these actions were not appropriate in the market of music streaming apps. The EU has been looking into this and is focusing on certain rules Apple has for app developers.
The rules stop apps like Spotify from telling iPhone and iPad users about cheaper music subscriptions. The subscriptions are outside of Apple’s App Store. Spotify says this helps Apple’s music app, Apple Music.
Apple Faces Huge Fine for Unfair Competition in Music Streaming Market
This case is part of a bigger issue about the rules and regulations of Apple’s App Store. However, many companies have criticized it. Because Apple charges a 30% fee on apps and purchases made within apps.
Moreover, Apple made some changes to address these concerns. Especially because of pressure from the EU’s Digital Markets Act (DMA). One change is that Apple will now let customers in the EU download apps without using its store.
EU Prepares to Penalize Apple for App Store Practices
The European Union (EU) didn’t say much about it, but it hinted that it would punish Apple. In the last February, the EU officially told Apple about its concerns over the case. The EU thinks Apple’s actions are unfair. They stop other companies’ customers about cheaper ways to subscribing to streaming services.
The EU sees this as Apple using its power unfairly in the market. The European Commission mentioned it saying the restrictions as “unfair trading conditions”. He said that Apple had violated Article 102. Moreover, Apple has also violated the European Union’s operating policy. In simpler terms, Apple has abused a dominant position in a particular market.
Apple’s App Store Rules Challenged
According to a report by the FT, the European Commission will announce the fine early in the next month. The biggest penalty for unfair competition is 10% of a company’s total global earnings. For Apple, this could mean a fine of up to $30 billion, but the actual amount might be less. However, Apple also has the right to appeal against any decision ruled by the commission.
On Monday, Both Apple and the European Commission did not want to say anything. Last year, Apple mentioned that the App Store had helped Spotify. Apple helped them to become the most popular music streaming service in Europe. Apple also hoped that the commission would stop looking into complaints about Spotify. However, according to the FT, it does not look like the commission will stop the investigation.
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