The European Union (EU) on Monday hit Apple Inc. with a €1.8 billion fine after an investigation into claims that it stifled music-streaming competitors, including Spotify Technology SA, on its platforms.
The European Commission also told the Cupertino, California-based company to stop blocking music-streaming apps from telling users about cheaper deals outside of Apple’s App Store.
Apple has, however, dismissed the EU’s fine, saying in a statement that regulators failed to “find any credible evidence of consumer harm, and ignores the realities of a market that is thriving, competitive, and growing fast.”
EU antitrust chief, Margrethe Vestager, said about the decision of the EU after the investigation:
“For a decade, Apple abused its dominant position in the market for the distribution of music streaming apps through the App Store.
“They did so by restricting developers from telling consumers about alternative, cheaper music services outside of the Apple ecosystem.”
The EU clampdown on Apple’s App Store has coincided with sweeping new rules aimed at preventing market abuses before they happen. Under the Digital Markets Act, which takes full effect this week, it’ll be illegal for the most powerful tech firms to favor their own services over their rivals.
Companies will be banned from merging personal data across their different services and from using data they get from third-party merchants to compete against them. They will also have to let users download apps from rival’s platforms.
The rules take full effect March 7 and Apple has also challenged its classification under the new regime.
Apple said in a statement on Monday in response to the fine that Spotify, which is the biggest beneficiary of the EU decision, has been profiting from the App Store without paying anything for the services offered by the App Store.
“Today, the European Commission announced a decision claiming the App Store has been a barrier to competition in the digital music market.
“The decision was made despite the Commission’s failure to find any credible evidence of consumer harm and ignores the realities of a market that is thriving, competitive, and growing fast.
“The main advocate for this decision — and the biggest beneficiary — is Spotify, a company based in Stockholm, Sweden. Spotify has the largest music streaming app in the world and has met with the European Commission more than 65 times during this investigation.
“Today, Spotify has a 56 percent share of Europe’s music streaming market — more than double their closest competitor’s — and pays Apple nothing for the services that have helped make them one of the most recognizable brands in the world.
“A large part of their success is due to the App Store, along with all the tools and technology that Spotify uses to create, update, and share their app with Apple users around the world,” Apple said.
The EU’s investigation was triggered by a complaint nearly five years ago from Spotify, which said it was forced to increase the price of its monthly subscriptions to cover costs related to Apple’s alleged grip on how the App Store works.
Apple’s fine was the latest in a series of decisions by the EU antitrust body aimed at breaking Big Tech’s dominance in the bloc through fines and regulatory actions.
Earlier, Vestager had imposed penalties of more than €8 billion on Alphabet Inc.’s Google and also told Apple to pay back €13 billion in allegedly unfair tax breaks from Ireland.
