Apple targets Spotify in eye-opening and lengthy statement after €1.8 billion EU fine

[Redaktion]

The European Commission has imposed a fine on Apple totalling €1.8 billion for alleged 'abusive App store practices'. Not only does Apple plan to appeal, but it has aimed its sights at Spotify in a blistering response.

https://www.notebookcheck.net/Apple-targets-Spotify-in-eye-opening-and-lengthy-statement-after-EUR1-8-billion-EU-fine.810194.0.html

[lmao]

eu socialists do not produce anything high-tech anymore (they lost their last hope, ARM, when uk jumped the sinking ship) and are slowly steering into 3rd world, so they are doing their best to rip off foreign companies without any real court case and create rules that favor local (spotify is swedish) businesses.
fun fact 1 - spotify always could use 3rd party payments as it's a 'bookshelf app' with zero fees, they weren't paying anything to apple.
fun fact 2 - apple music is paying higher royalties to creators than spotify - and even higher now with incentives for spatial music.
but it's not enough and spotify wants to show you their ads (the real intent behind misleading wordplay bla bla 'inform and link users to cheaper offers').

[Gallo123]

eu socialists do not produce anything high-tech anymore

You literally quoted two top tech companies from the EU. And then proceeded to say they don't.

You daft?

[lmao]

You literally quoted two top tech companies from the EU

what two companies?
arm and spotify lol? arm is not eu, and spotify is not high-tech lol

get your s*** together

[lmao]

straight from apple's statement

...Despite that success, and the App Store's role in making it possible, Spotify pays Apple nothing. That's because Spotify — like many developers on the App Store — made a choice. Instead of selling subscriptions in their app, they sell them on their website. And Apple doesn't collect a commission on those purchases.

just so the trolls don't start playing their victim 'apple greedy' card again and saying eu is doing it 'for the people'

[anan]

just so the trolls don't start playing their victim 'apple greedy' card again and saying eu is doing it 'for the people'

You do understand it was the anti-steering rule that was at issue. Spotify could have done what Twitter did: charge users one price on the web and a higher price on iOs. And at one point Apple had a rule that subscription price needed to be the same on iOs as it is elsewhere (WEB).
But the problem was that Spotify could not inform their users that they can get a cheaper subscription on the WEB.
And two price tiers could potentially deter price conscious users from subscribing because the iOs price was just tad too expensive. It would have needed to be 50% more expensive than WEB price for the profit margin to remain the same. And different prices would have been very bad publicity.

[lmao]

Spotify could have done what Twitter did: charge users one price on the web and a higher price on iOs.

did you even read what apple said.
spotify didn't charge users on ios, all transactions were through heir website, they paid apple ZERO fees.

[anan]

did you even read what apple said.
spotify didn't charge users on ios, all transactions were through heir website, they paid apple ZERO fees.

That is because this is a LIE. Spotify had an option to subscribe in iOs but disabled it in 2016. Netflix also had such an option but disabled it in 2018. They could not leave this much of their profit to Apple. Spotify pays out ~67% of it's revenue back to music rights holders. And most of the time Spotify is not profitable. So they fight for their profit however they can - it is a public traded company after all.

[lmao]

That is because this is a LIE. Spotify had an option to subscribe in iOs but disabled it in 2016

how is it a "LIE" if you saying yourself in the very next sentence spotify didn't have an option to subscribe on ios and managed all their subscriptions via website, which is allowed for these kinds of apps.

And most of the time Spotify is not profitable.

bad spotify business model isn't apple's fault, apple isn't taking any commission on spotify subscriptions

Spotify pays out ~67%

apple music royalties to creators are higher, and it's profitable despite not being even close to #1 market share, because of a proper business model

[anan]

how is it a "LIE" if you saying yourself in the very next sentence spotify didn't have an option to subscribe on ios and managed all their subscriptions via website, which is allowed for these kinds of apps.

Of course it is a lie. It is just a buthurt statement by Apple that Spotify CURRENTLY does not provide an option to subscribe on iOs. Spotify HAD this option but removed it later on. This is all that matters. It is a legal matter where Spotify accused Apple of onerous requirements to be able to provide a subscription option on their iOs app. Mainly that they could not inform their users that they can buy cheaper subscription on the web.
If Spotify NEVER had the option to subscribe on iOs then they would not have a standing. It would only be hypothetical and this would make it harder to sue. Spotify made a complaint in EU and EU agreed. And now Apple is just trying to deflect this matter and this got You if You have believed this Apple statement.

bad spotify business model isn't apple's fault, apple isn't taking any commission on spotify subscriptions

Again, Apple REQUIRES Spotify to pay a commission to Apple if Spotify wants to provide a subscription option. The fact that Spotify currently does not take this option is a moot point in this legal matter. Spotify has previously taken this poison pill/commission in the past and it argues that accompanying requirements are anti-competitive an EU agreed on some points.

apple music royalties to creators are higher, and it's profitable despite not being even close to #1 market share, because of a proper business model

That is because Apple Music is a value added service for Apple. It only provides a paid tier since Apple already has captured users and is just up-selling them. Spotify needs to attract users with a free tier. This is why overall Spotify pays out 67% of it's revenue to 'artists'. Apple pays out more per stream since every stream is paid for by a subscription. And overall Apple Music pays 'artists' 52% of it's revenue. And even with that Apple Music 'only' gets Apple a 15% profit margin. Basically, Apple Music pays out less to 'artists' to turn a meager profit by Apple standards (App store has a 90% profit margin in comparison). And on top of that any competitor that wants to sell a subscription on apple store app needs to kick back 30% to Apple. Apple Music is not encumbered with that and EU found this to be anticompetitive as well.

[lmao]

Of course it is a lie. It is just a buthurt statement by Apple that Spotify CURRENTLY does not provide an option to subscribe on iOs. Spotify HAD this option but removed it later on.

not a lie. they had in-app option option and it was their decision not to use it. they basically freerolled on the platform all this time not paying apple a penny. now they are playing victim card and covering up the fact they have an awful business model. spotify pulled in-app-purchases from both android and ios (both actually basically have the same policies).
the only difference is platform's reaction.
google decided to s*** on its developers and struck a deal with spotify allowing them to bypass fees.
apple decided to double down that rules are the same for everyone and forced spotify to comply.
so only because of shady discriminating deal google is out of all this eu thing, despite android rules about in-app purchases are exactly the same.
so what spotify does is simply bullying platform owners into providing a special service to them and them only. didn't work with apple, and they realize it's a doa court case, had to revert to corrupt eu politicians.

It is a legal matter where Spotify accused Apple of onerous requirements to be able to provide a subscription option on their iOs app

it is not a legal matter, it is a forced political eu decision in favor of local business. spotify agreed to tos, they knew the rules, and then they decided they deserve more than the rest.

Apple REQUIRES Spotify to pay a commission to Apple if Spotify wants to provide a subscription option.

and that's completely normal!

That is because Apple Music is a value added service for Apple. It only provides a paid tier since Apple already has captured users and is just up-selling them.

that's a huge exaggeration, if 'capturing users' was the case, apple music would be #1

Apple pays out more per stream since every stream is paid for by a subscription. And overall Apple Music pays 'artists' 52% of it's revenue.

this is called 'a proper business model'

And on top of that any competitor that wants to sell a subscription on apple store app needs to kick back 30% to Apple.

it's not a 'kick back', it's a fee for using lucrative platform apple is doing everything for, from devices to apis and marketing. i haven't yet seen a single developer who doesn't understand what this fee is for or wanted to ditch ios in favor of 'open' android.

Apple Music is not encumbered with that and EU found this to be anticompetitive as well.

apple music actually are paying the same fee. it's just moving the money from one pocket to the other, but it's showing that IF service really cares about users and has a proper business model, it will provide higher incentives to creators and stay profitable while paying the fee.

[anan]

apple music actually are paying the same fee. it's just moving the money from one pocket to the other, but it's showing that IF service really cares about users and has a proper business model, it will provide higher incentives to creators and stay profitable while paying the fee.

This is actually not true. Apple music is included in the Apple Services Division. Just like Apple Payment Services that manages Apple Pay. Apple does this purposefully to obfuscate the exact profit from every division. And all of this was done to hide the exact profit margin that App Store generates. They took all the 'software' divisions and grouped them into the 'Services Division'. That way they dilute the App Store profit with less profitable divisions. They then post how much revenue each division makes. And in case of Apple Music - how much of the revenue was paid out to 'artists' (the 52% figure). The even fought in court to hide specifically how much profit they make from App Store alone.
In order for money to move from one pocket to the other they need to have separate business entities. And right now all the money is being pooled into one account.
Mind you, Apple does have the 'from one pocket to the other scheme'. It is their double-irish tax avoidance scheme. For this Apple has created an Irish subsidiary that has a licensing agreement with Apple US. All the profit from iPhone and services sales in EU is then pooled into this Irish subsidiary. And then Apple US just writes a bill for 'licensing/royalty' Apple technology to Apple Ireland to the exact amount of the profit made in EU so that they do not pay the profit tax.