Music-streaming service Spotify has filed a formal complaint against Apple this week, claiming that the iPhone maker has violated European Union competition rules by using numerous tactics to try and ice out competitors.
"It's why, after careful consideration, Spotify has filed a complaint against Apple with the European Commission (EC), the regulatory body responsible for keeping competition fair and non-discriminatory".
Apps should be able to compete fairly on the merits, and not based on who owns the App Store. "We believe Spotify is largely on the right side in both facts and principle, which creates risk that App Store policy terms will be forcibly changed in a way that negatively impacts Services revenue and Apple's brand", KeyBanc analysts wrote in a note to clients. "Apple, you've got to break it apart from their App Store". Chief Executive Daniel EK said they are left with no choice but to inflate their prices to absorb the 30 percent "tax" cut made by Apple.
Spotify argues that it has to raise prices, making it more expensive than Apple's own streaming service, Apple Music.
Despite having an alternative of bypassing Apple's payment system, Ek also expressed the futility in doing so; Apple will then implement various restrictions that causes limitation in communication among Spotify and its users.
Spotify's complaint apart, there also seems to be a consensus building in the U.S. about the growing clout that several companies has begun to exercise on the masses or the market.
Spotify has formally asked Brussels to crack down on Apple's app store, alleging that the iPhone maker is "tilting the playing field to disadvantage competitors". Through their app stores, the two tech giants have for years acted as gatekeepers to iPhone and Android users, dictating how many people shop for apps and pay for their services.
Ek says the company had tried - and failed - to resolve these issues with Apple before filing a complaint to the EC. "This is how we convert our free customers to premium", Gutierrez said.
Ek says that Spotify wants the same treatment as other App Store apps like Uber and Deliveroo, "who aren't subject to the Apple tax and therefore don't have the same restrictions". Also, that consumers should have the choice of using whichever payment system they want within the apps and that developers should not be prevented from communicating with its users when it comes to marketing and promotions.
We've reached out to both companies and will update if we hear back.
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