In a filing to the European Commission (EC), Apple has pushed back against Spotify’s complaint that the 30% App Store fee is anti-competitive by claiming that Spotify only pays a 15% fee on less than 1% of its premium members.
According to Spiegel Online (Google Translate link), Apple submitted this filing to the EC in May and said that 680,000 of Spotify’s 100 million paid users (0.68%) currently pay this 15% fee. This figure is understandably low given that Spotify only allowed users to upgrade to Spotify Premium through Apple’s in-app purchase system between 2014 and 2016 so it’s been almost three years since a premium Spotify user was onboarded via this method.
By presenting this information to the EC, Apple’s argument seems to be that the App Store fee isn’t anti-competitive because Spotify has managed to grow its paid user base without paying any fees to Apple on over 99% of these users. Apple may also be trying to highlight that Spotify didn’t mention that the App Store’s 30% fee drops to 15% after the first year – a point it made when publicly responding to Spotify in March.
However, Spotify’s main point about this fee is that the 30% first-year rate is too expensive and that’s the primary reason it stopped using Apple’s in-app purchase system in 2016. The information presented by Apple doesn’t contradict Spotify’s argument that the expense prevents Spotify from using Apple’s in-app purchase system which then makes it difficult for Spotify users to upgrade to premium on iOS devices and causes Spotify to lose customers.
The European Union (EU) is reportedly planning to launch an antitrust investigation into Apple so there’ll probably more developments related to this complaint as that investigation progresses.
For now, it’s the latest in a series of reports that piles more antitrust scrutiny into the way Apple runs the App Store. This scrutiny has been ramping up since the US Supreme Court ruled that Apple has to face an App Store antitrust case. Since that ruling, the US House Judiciary Committee has announced that it’s launching an investigation into big tech and reports have suggested that the US Department of Justice (DOJ) is also planning to investigate Apple.
Developers and software companies are also calling on the US government to take action against Apple with free speech software company Gab reporting Apple to the DOJ and the company behind the popular Puffin browser recommending that the US government reign Apple in.
Apple has recently relaxed some of its App Store rules in the face of this mounting pressure but insists that Apple is is not a monopoly.