Apple is reportedly facing a fine from the EU of as much as â¬500m over restrictions on access to music streaming services, in what would be a landmark blow to the US tech company.
The European Commission is investigating whether the US company blocked music streamers from telling users about cheaper ways to subscribe outside its app store where it takes a significant cut of revenues, according to the Financial Times.
A fine of â¬500m (£427m) would represent a landmark ruling against Apple after years of complaints from companies whose services are delivered via iPhone apps.
The Swedish streaming company Spotify filed a complaint with the EU in 2019, claiming that Apple limits choice and competition in its app store by charging a 30% fee on all purchases. Apple also prevented Spotify and other companies from informing customers on their phones that they could avoid the commission â and get a better deal â simply by signing up on Spotifyâs website.
Apple says its fee is justified because it spends heavily on providing a secure app store, and provides Spotify with access to hundreds of millions of customers. However, Spotify argues that Appleâs own music streaming service, Apple Music, does not face the same extra cost, giving it an advantage and making the fees anti-competitive.
The European Commission will say Appleâs actions are illegal and go against the blocâs rules that enforce competition in the single market, according to the FT which cited five people close to the investigation. The commission could also reportedly ban the practice of blocking music services from advertising cheaper subscriptions outside the platform.
Apple has never faced a competition fine from the European Commission, although it received a â¬1.1bn fine from France in 2020 for anti-competitive agreements with two wholesalers.
However, it and other big tech companies are under increasing scrutiny over competition concerns. Google is appealing against fines of more than â¬8bn levied by the EU in three separate competition investigations. Apple defeated a lawsuit by Fortnite developer Epic Games that claimed that the app store was an illegal monopoly, but Epic in December won a similar cases against Google, which operates the Android mobile phone software.
Last month, Apple said it would allow EU customers to download apps without going through its own app store, a response to the blocâs Digital Markets Act. The law, the details of which were revealed last year, introduces new obligations for âgatekeepersâ including Amazon, Google and Amazon who hold particularly powerful positions in controlling mobile phone software choices.
after newsletter promotion
The European Commission declined to comment. Apple has been approached for comment.
