Why Spotify is still fighting with Apple in Europe

Over the past couple of months, Spotify has been submitting update after update to Apple, changing the interface of its music streaming service to display pricing information in-app for users in the European Union. For users, this is barely worth noticing. But for Spotify, each submission has been yet another skirmish in its yearslong legal struggle with Apple in the EU. And right now, Spotify is the closest it’s ever been to getting Apple to finally cave. 

In March, the European Commission ruled against Apple in an antitrust action over App Store restrictions on music streaming services. In 2019, Spotify filed an antitrust complaint against Apple, claiming that the App Store’s cut of subscription fees — which can be up to 30 percent — stifled innovation and harmed consumer choice. The Commission ultimately agreed with Spotify on its anti-steering complaints and hit Apple with a €1.84 billion (about $2 billion) fine. It also determined that the company’s anti-steering rules are illegal and ordered Apple to allow music streaming services to “freely communicate with” their users “within their apps about available subscription options,” including linking to external subscription options.

Shortly after the Commission’s ruling, Spotify submitted an update that put pricing information directly inside the app and linked users to external subscription options outside of Apple’s payment system. Apple never responded. (Apple says that it reviews 90 percent of submissions in “less than 24 hours.”) 

On April 5th — just one day before the European Commission could begin enforcing its decision to block Apple’s anti-steering rules — Apple carved out a new entitlement program that would let music streaming apps include external links to purchases. That sounds great and all, but Apple also wants a 27 percent cut of those purchases.

To get around that fee, Spotify submitted another version of its app for EU customers weeks later. This time, it only had basic pricing information instead of links to the streaming app’s website. Apple rejected the app update shortly after it was submitted. It said Spotify must agree to the entitlement and pay Apple a commission regardless of whether the app includes an external link.

So now the dispute is going back to the European Commission. 

“Ultimately, what we want is the ability to communicate to our users about prices, better plans,” Harry Clarke, the associate general counsel for Spotify, said during a press briefing on Wednesday. “We want users to have a better experience, and that’s why the commission reached these conclusions.”

As the Commission looks into whether Apple’s new music streaming app policy complies with its court order, it’s also in the bloc’s crosshairs for another reason: the Digital Markets Act (DMA). Apple is considered a “gatekeeper” under the new set of laws that went into effect earlier this year and governs how Big Tech operates. It has already led Apple to start allowing developers with apps in the EU use alternative payment options and distribute their apps on alternative app stores, given that they agree to Apple’s new business terms and pay its new Core Technology Fee.

The Commission opened an investigation into Apple in March over concerns its changes don’t fully comply with the DMA. This could subject Apple to not one — but two — enforcement actions in the EU if the Commission finds any wrongdoing, and Spotify seems confident that the EU will do right by it. “The question for the commission is whether it addresses it through a non-compliance investigation of the case or through the DMA non-compliance investigation,” Clarke said. “I would argue it should do both.”