Apple has been fined over 1.8 billion Euros for abusing its dominant position in the market for distributing music streaming apps to its iOS users through the App Store by the European Commission, as expected.
The union cites Apple’s anti-steering provisions as an unlawful act that bans music streaming app developers from fully informing iOS users about alternative and cheaper music subscription services.
This development stems from an extensive inquiry triggered by Spotify’s grievance back in 2020, alleging Apple’s bias towards its own music service, Apple Music, through App Store policies.
The huge fine amount is due to Apple’s abuse of its position for almost 10 years, causing iOS users to pay significantly higher prices for music streaming subscriptions.
In setting the level of the fine, the Commission took into account the duration and gravity of the infringement as well as Apple’s total turnover and market capitalization, according to the EU report.
Apple attracted this fine just in time to roll out its announced updates to iOS, Safari, and the App Store in the European Union (EU) to comply with the Digital Markets Act (DMA). The new update, which should roll out this month, lets developers use payment service providers (PSPs) within their apps, with payment processing via link-out allowed.
Apple criticises this move by blaming Spotify and confirmed it’ll appeal the decision. It said:
It was reached despite the Commission’s failure to uncover any credible evidence of consumer harm, and ignores the realities of a market that is thriving, competitive, and growing fast.
The primary advocate for this decision — and the biggest beneficiary — is Spotify, a company based in Stockholm, Sweden. Spotify has the largest music streaming app in the world and has met with the European Commission more than 65 times during this investigation.
Regarding the matter, Margrethe Vestager, Executive Vice-President in charge of competition policy, said,
For a decade, Apple abused its dominant position in the market for the distribution of music streaming apps through the App Store. They did so by restricting developers from informing consumers about alternative, cheaper music services available outside of the Apple ecosystem. This is illegal under EU antitrust rules, so today we have fined Apple over €1.8 billion.