Apple Faces €500 Million Fine for Alleged Bias Towards Its Own Music App

The European Commission is reportedly considering a €500 million ($539 million) fine for Apple, as per the Financial Times. The potential penalty is linked to allegations that Apple showed favoritism towards its own Apple Music over competitors like Spotify within the App Store. Spotify, a Swedish audio streaming service, filed a complaint in 2019, accusing Apple Music of not paying royalties to its parent company and receiving preferential treatment. Apple denied the claims, but skepticism surrounded its defense.

 

Initially, the European Union had aimed for fines of up to 10% of Apple’s global revenue, potentially reaching $40 billion. The primary concern revolves around the “Apple tax” imposed on services like Spotify, comprising 30% of transactions. While Apple asserts this rate applies only for the first year, reducing to 15% afterward, concerns persist about its impact on returning customers. Additionally, Spotify argues that Apple’s characterization of its app as “free” is contradicted by mandatory developer account fees.

 

This standoff has implications for Spotify’s operations, hindering its ability to introduce in-app purchases. The potential implementation of the Digital Markets Act (DMA) by Apple could bring changes for European users, introducing new features but also fueling the ongoing conflict between the two companies.