The streaming company announced that it is filing an anti-trust complaint against Apple with the European Commission earlier today (March 13) over the controversial 30% ‘app tax’ that third-party app developers have to pay on sales made through the App Store.
This 30% commission has to be paid by music streaming businesses, too – and two leading names in the field, Anghami and Deezer, have now come out in force to back Spotify in its complaint.
The filing with the EC was announced via a blog post penned by Spotify co-founder and CEO Daniel Ek, in which he argued that Apple is “acting as both a player and referee to deliberately disadvantage other app developers”.
“After trying unsuccessfully to resolve the issues directly with Apple, we’re now requesting that the EC take action to ensure fair competition.”
Daniel Ek, Spotify
“After trying unsuccessfully to resolve the issues directly with Apple, we’re now requesting that the EC take action to ensure fair competition,” writes Ek.
“We aren’t seeking special treatment. We simply want the same treatment as numerous other apps on the App Store, like Uber or Deliveroo, who aren’t subject to the Apple tax and therefore don’t have the same restrictions.”
Spotify has also launched TimeToPlayFair.com, a campaign site aimed at consumers with sections including a Timeline of Apple’s alleged anti-competitive behaviour, FAQs and Fast Facts that show why it believes ‘Apple doesn’t play fair’.
While Spotify is the only one of Apple’s music streaming competitors that have filed a formal complaint about the 30% App Store commission, the move by the streaming Swedish streaming company has clearly struck a chord with its music streaming peers.
Speaking to MBW, Elie Habib – Co-Founder of Anghami, the leading streaming firm in the Middle East and North Africa – has called Apple’s treatment of other music streaming businesses “blatantly anti-competitive”.
“I think the entire music streaming industry stands behind Spotify in this battle – because it’s blatantly anti-competitive,” added Habib.
Habib also outlined five points of concerns covering “restricting digital payments, high tax, access to private SDK [Software development kit], [Apple] Watch and Siri”, which you can read in full below.
“I think the entire music streaming industry stands behind Spotify in this battle – because it’s blatantly anti-competitive”.
Elie Habib, Anghami
1. Payment methods: We do most of our revenue from mobile operators integration. Yet, we can’t properly push that to the user on iOS. We end up using SMS because Apple doesn’t let us even write that in the FAQ. We were rejected multiple times because we mentioned an operator or having an Android app. We just can’t stand behind this ostrich rule.
2. [App] Store tax: That’s the same concern of Spotify. Apple is a competitor of ours that matched our price when they launched after us. Yet we end up paying 30% more – while doing the same music deals.
3. Trials/Private SDK: Apple allows users in the region to create an iCloud account without adding a credit card – unlike mature markets. That makes perfect sense. However, when we offer Free No Commitment Trials (like Apple Music) that eventually convert if a user doesn’t cancel. Apple doesn’t validate that the user has a credit card on file before allowing him to get the trial.
Hence a good % every month is lost to people that Apple couldn’t bill – as they have no credit card. However, Apple Music has access to some private SDK, allowing them to tell the user “Please add a credit card to your account before proceeding to the trial”. That’s a huge anti-competitive SDK. Google on the other hand, allows users not to put a credit card when creating the account, but upon asking for a trial that converts, it doesn’t allow the user to continue without adding a credit card – applies to everyone alike.
4. Apple Watch : we released an app for Apple Watch and reworked it a couple of times, but due to the nature of the SDK, the app quality can never match Apple Music watch app. While I admit the latest SDK made things better, we still can’t control sending offline music to the watch properly. Explains why Spotify never released this feature.
5. Siri : Voice comms is growing all around, however on iOS, you can connect Siri intents to a ‘to do’ app, a taxi hailing app – but not to a music app. They just don’t allow that. We recently launched the new Siri Shortcut functionality that allows a user to record a voice message and connect a playlist/album or something else to it. But this doesn’t match what Apple Music can do in their ecosystem natively. On the other hand, Google has no such restrictions.
Another company to publicly back Spotify’s move is Deezer, which is majority owned by Access Industries – also the 100% owner of Warner Music Group.
“We support Spotify in wanting a level playing field so that companies have to compete through innovation, content and customer focus.”
Deezer Spokesperson
A Deezer spokesperson told MBW today: “Streaming is one of the most competitive industries in the world.
“We support Spotify in wanting a level playing field so that companies have to compete through innovation, content and customer focus.
“We look forward to the European Commission’s response to Spotify and will be following this issue closely.”Music Business Worldwide
