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Spotify Updates App in Response to EU Ruling Against Apple’s Anti-Competitive Practices

  • EU Fines Apple: European Commission fines Apple €1.84 billion for anti-competitive practices in the music streaming market.
  • Spotify's Response: Spotify swiftly updates its app, revealing pricing and subscription details, in compliance with the EU's ruling.
  • Apple's Stand: Apple plans to appeal, arguing Spotify is the biggest beneficiary of the App Store without proportional compensation.

In light of the recent European Commission ruling against Apple’s anti-competitive practices in the music streaming market, Spotify has submitted a new version of its app to the App Store, pending approval from Apple. The updated app includes pricing and feature information about Spotify’s various subscription plans, along with a direct link for users to purchase these plans from Spotify’s website.

EU Ruling Against Apple

Earlier this week, the European Commission imposed a hefty fine of €1.84 billion (approximately R31.6 billion) on Apple for its anti-competitive behaviour in the music streaming market. The ruling followed an investigation into Apple’s practices, which concluded that the tech giant had been engaging in anti-steering practices, limiting competition in the market.

Margrethe Vestager, the EU’s competition chief, stated in a press conference that Apple would now be required to allow music streaming developers to communicate freely with their users regarding alternative purchasing options, whether within the app, via email, or through other means of communication.

Spotify’s Response

Buoyed by the EU’s decision, Spotify has wasted no time in taking action. The music streaming company has updated its app to comply with the new regulations, providing users with clear information about subscription plans and offering a direct link to purchase these plans outside of the app.

Prior to this update, Spotify had faced restrictions imposed by Apple, preventing the company from displaying prices for its subscription plans within the app. Instead, users were met with messages such as “You can’t upgrade to Premium in the app. We know, it’s not ideal.”

Changes to the Digital Markets Act (DMA)

Spotify’s move aligns with the broader context of changes proposed under the Digital Markets Act (DMA), which aims to regulate the behavior of large tech companies like Apple. The DMA had initially hinted at allowing in-app subscriptions and direct purchases, but Apple’s compliance method had initially hindered these plans.

Despite potential challenges, Spotify remains determined to implement these changes, despite potential additional fees imposed by Apple for core technology.

Apple’s Response and Future Plans

In response to the EU ruling, Apple has announced its intention to appeal the decision. The tech giant argues that Spotify has been the primary beneficiary of the App Store and its services without adequately compensating Apple. Apple contends that Spotify enjoys a significant market share in Europe’s music streaming market while paying nothing to Apple for the services that have contributed to its success.

Conclusion

The submission of Spotify’s updated app marks a significant development in the ongoing battle between tech giants over market dominance and fair competition. With the EU’s ruling against Apple and Spotify’s proactive response, the dynamics of the music streaming market may undergo significant changes in the coming months. As the situation continues to unfold, both companies are likely to remain at the forefront of discussions surrounding competition and consumer choice in the digital age.

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