The European Union is poised to impose a €500 million (approx. $539 million) fine on Apple for allegedly stifling competition in the music streaming market. This would mark the first time the bloc has levied an antitrust fine against the tech giant.
The news was reported by The Financial Times, citing five people “with direct knowledge of the long-running investigation.” The newspaper said the penalty is expected to be announced early next month.
The fine reportedly stems from an ongoing investigation launched in 2019 following a complaint from Spotify, which accused Apple of abusing its dominant market position through its App Store rules.
Spotify CEO Daniel Ek at the time said Apple was “essentially acting as both a player and referee to deliberately disadvantage other app developers.”
In 2020, the European Commission launched a probe over Apple’s App Store rules in the Europe-wide market, seeking to investigate, among other things, the controversial 30% commission — also known as Apple’s ‘app tax’ — that Apple charges third party app developers on many subscription fees. The app tax also allegedly applies to rival music streaming subscriptions.
“Apple’s restrictions may distort competition for music streaming services on Apple’s devices,” the European Commission said in June 2020 when it launched the probe.
“Apple’s competitors have either decided to disable the in-app subscription possibility altogether or have raised their subscription prices in the app and passed on Apple’s fee to consumers,” the Commission added.
The scope of the investigation was narrowed in 2023, focusing on the way Apple restricts apps such as Spotify from telling users about alternative subscription options. The bloc also dropped a charge of pushing developers to use its own in-app payment system.
Most recently, the FT’s sources indicated that the EU will formally notify Apple of its alleged illegal actions, deeming them a violation of the bloc’s competition regulations and branding Apple’s terms as “unfair trading conditions.” Moreover, the EU is poised to prohibit Apple from preventing music services from redirecting users outside the App Store to cheaper alternatives.
In another antitrust matter, Brussels is reportedly in talks with Apple’s competitors regarding the concessions made by the tech company to address concerns about the way it restricts rivals from accessing its mobile payment system. The tech giant, with a market cap of $2.8 trillion, is being investigated for potentially having broken the law in the way it operates Apple Pay, a payments system that operates on hundreds of millions of iPhone devices.
The timing of the Commission’s announcement regarding this issue has yet to be determined, according to the FT’s sources, although they clarified that it will not alter the course of the ongoing antitrust investigation.
The latest move by the EU signifies its growing assertiveness in regulating the power of large tech companies. The bloc has previously taken action against other tech giants like Google and Amazon for antitrust violations. Apple, which has never been fined for antitrust violations by the EU, previously incurred a €1.1 billion ($1.2 billion) fine in France, which was later reduced to €372 million ($401 million) after an appeal.
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