Apple set to face formal EU antitrust review over Spotify complaint

By Nikita Chaurasia  | Date: 2019-05-06

Apple set to face formal EU antitrust review over Spotify complaint

The EU has studied the complaint as well as surveyed users, competitors, and others in the industry, which led to the official investigation.

Reports confirm that the European Union will launch an official probe of Apple Inc. in the coming few weeks over an antitrust complaint filed by Spotify. Earlier this year, Spotify, the music streaming company, had complained to the antitrust agency of EU that Apple’s 30% cut of revenue effectively represented a tax on competitors.

Apparently, this dispute came as the iPhone maker shifted into new business areas that competed with third parties on its platform. Apple said that it only takes 30% from paid subscriptions and doesn’t charge for distributing free apps on its platform. The company also said that the rate drops to 15% for subscriptions extending more than a year.

However, in case of Spotify, Apple stated that several customers of the music streaming service use the ad-supported, free product and only a small portion of the subscriptions fall under revenue-sharing model of Apple.

According to Financial Times, the EU has studied the complaint as well as surveyed users, competitors, and others in the industry which led to the official investigation. The authorities have not set any deadlines for the investigation yet. 

Supposedly, EU enforcers have been successful in pushing companies to amend any business practices they consider illegitimate and fines could go as high as a 10th of their worldwide sales.

Sources familiar with the matter informed that Apple previously fired back at Spotify, the Stockholm-based company, saying that music streaming giants are looking to avail all the benefits without contributing to the marketplace. Spotify in turn said that Apple routinely blocked a few of its product upgrades like integration with the Apple Watch and the Siri digital assistant.

Seemingly, in the past week, Spotify had touched 100 million paid subscribers, which was a first for any online music service, and also added more customers in the latest quarter.

Source credit: https://www.bloomberg.com/news/articles/2019-05-05/eu-to-start-formal-probe-on-spotify-s-apple-complaint-ft-says

About Author

Nikita Chaurasia     aeresearch.net

Nikita Chaurasia

An accomplished professional in the field of content development, playing with words comes naturally to Nikita Chaurasia. After completing her post-graduate MBA degree in Advertising and PR, Nikita worked across numerous content-driven verticals, undertaking diverse r...

Read More >>

More News By Nikita Chaurasia

Tata Tele Business Services to offer Microsoft Azure to Indian SMBs

Tata Tele Business Services to offer Microsoft Azure to Indian SMBs

By Nikita Chaurasia

Telecommunications service provider, TTBS (Tata Tele Business Services) has reportedly announced that it would help Indian SMBs (small and medium businesses) migrate their workloads to the cloud by providing Microsoft Azure (cloud computing services)...

Tatas in plans to acquire Bisleri in a deal worth USD 856 million

Tatas in plans to acquire Bisleri in a deal worth USD 856 million

By Nikita Chaurasia

India's fast-moving consumer goods company, Tata Consumer Products Ltd is reportedly all set to acquire drink company, Bisleri International in a deal worth USD 856 million (₹7000 crores), reported the packaged water makers chairman, Ramesh...

Ukio raises $28M to offer comfort to working professionals across Europe

Ukio raises $28M to offer comfort to working professionals across Europe

By Nikita Chaurasia

Ukio, an apartment rental agency in Barcelona, Spain, has reportedly raised $28 million (€27 million) in a Series A round of funding. Apparently, the cash injection consists of over $17.5 million (€17 million) in equity and more than $10...

Amazon’s AWS unveils 2nd infrastructure region in Hyderabad, India

Amazon’s AWS unveils 2nd infrastructure region in Hyderabad, India

By Nikita Chaurasia

IT service management company, Amazon Web Services, Inc. (AWS), has recently announced the unveiling of another leading AWS infrastructure region in India, the AWS Asia Pacific (Hyderabad) Region. Starting this week, the startups, developers, ente...

Beijing reports increase in COVID-19 cases after first death in six months

Beijing reports increase in COVID-19 cases after first death in six months

By Nikita Chaurasia

World's most populous country, China has recently reported the fatalities of three people in Beijing as the first fatalities from coronavirus in the last six months, with the rise in recorded new cases despite following the strictest zero-COVID p...