Apple was fined 1.84 billion euros by European Union antitrust regulators for its App Store rules. The penalty came after Spotify's appeal.
Apple was fined 1.84 billion euros by European Union antitrust regulators due to App Store rules, and it was decided that music services could not block advertisements that cheaper subscriptions were available outside the Apple store.
News of today's fine was previously reported by the Financial Times and comes ahead of Apple's major change to the iPhone's app distribution rules due to the EU's Digital Markets Act.
In a press release on Monday, the EU Commission said Apple had banned music service app developers from informing iOS users about alternative and cheaper music subscription services outside the app, and also prevented app providers from sharing instructions on how to subscribe.
"Apple abused its dominant position"
"For a decade, Apple has abused its dominant position in the market for the distribution of music streaming apps through the App Store. They did this by restricting developers from informing consumers about alternative, cheaper music services outside the Apple ecosystem. This practice is illegal under EU antitrust rules, which is why today we have fined Apple over €1.8 billion."
The Commission said that the duration and seriousness of the infringement, as well as Apple's total turnover and market capitalisation, were taken into account when determining the fine, as well as false information submitted by Apple during the administrative procedure.
The EU's investigation dates back to 2020 and was announced after Spotify filed an antitrust complaint over Apple's so-called "Apple Tax". In addition to complaining about the 30 per cent commission, Spotify also challenged App Store rules that it said restricted communication with its customers and limited its ability to market and promote deals.
Apple made a concession in 2021, saying that developers could advertise payment methods outside the iOS app through communication methods such as email. Then, in early 2022, it allowed developers to link to their own sites from within iOS apps. However, this latter change only applied to "reader apps" for services primarily designed to provide access to digital content, such as Netflix, Kindle or Spotify, and developers had to request an "authorisation" before they could include an external link.
The EU fine comes as Apple prepares to overhaul its app distribution rules in the EU to comply with the Digital Markets Act (DMA) from 7 March, allowing third-party app marketplaces for the first time on the iPhone. But app developers have criticised Apple's approach, which includes charging up to 17 per cent commission to developers who use its payment method or link to its website, and an annual fee of €0.50 per app install after the first million. Spotify said the changes would disrupt developers' business and were unworkable.
