BRUSSELS. The European Commission has sent new formal complaints to Apple for distorting competition in the music streaming market by abusing its dominant position to distribute music streaming apps in its App Store. The EU antitrust challenges the mandatory use of Apple’s in-app purchase mechanism imposed on app developers, and is also concerned about the restrictions Apple applies to developers, preventing them from informing iPhone and iPad users of alternative possibilities. purchase. The EU investigation follows a Spotify complaint.
«App stores play a central role in the digital economy. We can now shop, access news, music or movies via apps instead of visiting websites. Our preliminary assessment is that Apple is a gatekeeper for iPhone and iPad users via the App Store. With Apple Music, Apple also competes with music streaming providers. By setting strict rules on the App Store that disadvantage competing music streaming services, Apple deprives users of cheaper choices and distorts competition, ”said competition commissioner Margrethe Vestager. Apple, he explained, charges rivals high fees on every transaction in the App Store and forbids them from informing their customers of alternative subscription options.
For app developers, the App Store is the only gateway for consumers using Apple devices. Apple’s devices and software form a ‘closed ecosystem’ in which Apple controls every aspect of the user experience for iPhones and iPads, notes the Commission. The Apple App Store is part of this ecosystem and is the only store that iPhone and iPad users can use to download applications for their devices. The Commission found that Apple device users are very loyal to the brand and do not change easily. Brussels concerns relate to two rules Apple imposes on rivals. First, the mandatory use of its in-app purchase system for the distribution of paid content. Apple charges developers a 30% commission on all subscriptions purchased through its system.
And the Commission has found that these pass on these costs to users by increasing the prices of subscriptions. The second rule is the one that limits the ability of developers to inform users of alternative purchasing possibilities. “The Commission fears that Apple users will pay much higher prices for their music streaming services or be prevented from purchasing certain services directly in their apps.”