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Apple slapped with €1.8 billion EU fine over App Store rules

Apple slapped with €1.8 billion EU fine over App Store rules

Apple has been dealt a €1.8 billion fine by the European Union over its App Store rules which “abused” the tech giant’s dominant position in the music streaming market.

The European Commission has ordered Apple to stop preventing music-streaming apps from informing users of cheaper deals away from its App Store.

It follows years of complaints by major European music streaming rivals such as Spotify, which in 2019 filed a complaint with the EU in 2019, claiming that Apple’s rules limit choice and competition.

“For a decade, Apple abused its dominant position in the market for the distribution of music streaming apps through the App Store,” EU competition chief Margrethe Vestager said. “They did so by restricting developers from informing consumers about alternative, cheaper music services available outside of the Apple ecosystem.”

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In a statement Spotify said: “Today’s decision marks an important moment in the fight for a more open internet for consumers. The European Commission (EC) has made its conclusion clear: Apple’s behaviour limiting communications to consumers is unlawful. This decision sends a powerful message—no company, not even a monopoly like Apple, can wield power abusively to control how other companies interact with their customers.

“Apple’s rules muzzled Spotify and other music streaming services from sharing with our users directly in our app about various benefits—denying us the ability to communicate with them about how to upgrade and the price of subscriptions, promotions, discounts, or numerous other perks. Of course, Apple Music, a competitor to these apps, is not barred from the same behaviour. By requiring Apple to stop its illegal conduct in the EU, the EC is putting consumers first. It is a basic concept of free markets—customers should know what options they have, and customers, not Apple, should decide what to buy, and where, when and how.

Apple has rejected the EU’s fine and has said it intends to appeal the decision.

In a statement the California-based business added regulators failed to “uncover any credible evidence of consumer harm, and ignores the realities of a market that is thriving, competitive, and growing fast.”

Apple has argued that Spotify and other music streaming services had many open channels, including email marketing and social media, to advertise to consumers and show them how to sign up outside of the App Store.The iPhone maker said Spotify had the option to directly link to their website for account creation and management, but chose not to use it, and that despite its claims of competition concerns and not allowing it to tell users how to subscribe, had grown into the largest digital music business in the world with more than 50% market share in Europe.