Saturday, 17 August, 2019

Apple: Spotify only paying for 680K members

Apple: Spotify pays 'app tax' on less than 1% of paid subscribers Apple hits back at Spotify claims that its 'app tax' stifles competition in Europe
Emmett Howard | 25 June, 2019, 19:13

Apple competes directly with Spotify with its Apple Music service.

The company even launched the consumer-facing TimeToPlayFair.com including a Timeline of Apple's alleged anti-competitive business practices, FAQs and Fast Facts that show why it believes "Apple doesn't play fair".

Spotify opted out of the in-app purchase system in 2016, but subscriptions before that date still fall under the App Store commissions, which drop to 15% after the first year of a subscription.

The data arrived in Apple's response to SPOT's complaint with European Union antitrust regulators, which says the iPhone maker uses the App Store's policies and fees to stifle competition.

While there is a certain degree of validity to Spotify's complaints, the argument that Apple is monopolising the market does seem to ring empty, especially if we're talking about music streaming services.

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Spotify filed a complaint with the European Commission (EC) back in March, alleging that by charging a 30 per cent fee on any sales through its App Store, including subscription services, the firm is putting itself at an "unfair advantage".

Apple further substantiated its stand by adding that Spotify only pays Apple fee on a little over 0.5 percent of its total subscribers. "That's not discrimination, as Spotify claims", Apple said in a statement. German newspaper Der Spiegel earlier reported the figures from Apple's response. That has included rejecting Spotify's app multiple times over the last three years for purported violations of the App Store guidelines.

The ongoing battle between Apple and Spotify has taken a new turn.

The iPhone-maker also made it clear that Spotify used its App Store billing system between 2014 and 2016.

If Spotify were to resume in-app purchases and let listeners sign up to be paid members in its app, any of those new members would be subject to the 30% fee. Apple had levied 30 percent fee for the first year and then it transitioned to a 15 percent fee each year. Spotify, according to The Verge, has 217 million monthly users, while Apple Music has around 40 million paid subscribers.

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