So far, streaming providers have been forced to hand over a partial revenue to iPhones for subscriptions on iPhones. The music streaming service Spotify does not want to accept this anymore and has now lodged a complaint with the European Commission. That could give Apple a significant drop in sales.
The Scandinavian music streaming provider Spotify recorded the first profit at the end of last year. In the fourth quarter of 2018, 96 million were paid subscribers; Together with its free version, the provider came to a total of 207 million users.
The competition from Apple with its service Apple Music is knocked down in second place, but has now outstripped Spotify Spot in the important US market.
Now that the Swedish company has told some of its users to put an address in order to catch up with “fake” families, it is now against Apple. Specifically, it is about unfair advantages that the competitor procures at the same time as a platform provider.
EU antitrust case against Apple
DHe is the leader in music streaming accusing Apple of having introduced unfriendly rules for users in its App Store. On his own website, Spotify CEO Daniel Ek explains the complaint and accuses Apple of intentionally hindering innovation.
The background: App providers usually receive in App Store’s app store and other download platforms such as Google’s Play Store 70 percent of revenue. The remaining 30 percent will be awarded to the operator of the platform.
At Apple, however, this rule also applies to in-app purchases. From the second year, however, Apple reduces this subscription revenue to 15 percent. However, this is different for Android devices.
The online portalTechcrunchquotes executive lawyer Horatio Gutierrez, who stated that he uses alternative payment options on Google’s Spotky platform and is exempt from a similar charge there. In Apple’s App Store, it is also prohibited providers, his users to refer to other offers and thereby forward to a website.
Claim: Let payments pass the platform
Spotify is not alone with its demand for a fair competition: In the past, several providers have increasingly criticized Apple for this required commission.
For example, Spotify was forced to sell its premium subscription at some point in the iPhone app more expensive than a direct deal.
In order to maintain its cost-covering business model in the future, the price for the subscription would have to be increased drastically and would then be heavily above the subscription price for Apple Music, soSpotify CEO Ek. Meanwhile, users can no longer complete Spotify’s premium subscription on the iPhone.
Even the video streaming provider Netflix offers since late 2018 new customers no longer to complete a subscription directly in the app.
Apple’s practices are increasingly coming up against criticism
Apple also reaps criticism from the US. For example, US Senator Elizabeth Warren is calling for the destruction of big Internet corporations like Apple, Amazon, Google and Facebook.
Spotify’s claim is plausible: in the future, the same rules should apply to all apps and services. Similarly, users should be allowed to decide between different payment services in the future.
It will be exciting to see how the EU judges this case. In addition to a sensitive punishment is also conceivable that the Apple Store is decoupled, so as to ensure equal opportunities for app providers.
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