European Union has charged apple with Antitrust violations over the company’s App Store policies. According to the EU, the tech giant was illegally using its app store to create dominance over its rival apps following an initial complaint by Spotify back in 2019.
EU has said that Apple has imposed the rule on developers to use its in-app purchase system for which Apple charges a 30 percent cut and also forbids developers to inform users of other purchasing options outside of apps.
EU has noted that the 30 percent “Apple Tax”, as it is referred, to being the reason for higher prices for consumers on its App Store.
“By setting strict rules on the App store that disadvantage competing music streaming services, Apple deprives users of cheaper music streaming choices and distorts competition,” said European Competition Commissioner Margrethe Vestager. She further added that “this is done by charging high commission fees on each transaction in the App Store for rivals and by forbidding them from informing their customers of alternative subscription options.”
This is the initial stage of formal antitrust proceedings against Apple and the company will have the chance to respond to the Commission’s objections within the next 12 weeks. Apple has firmly rejected the accusations made by the EU regulators.
European Commissioner said in press conference that this is not the last case they will have a look at when it comes to app store. They are also going to look into gaming apps in the App Store too.
Microsoft called on regulators to investigate the App Store last year, just a couple of months before a public spat with Apple over its xCloud game streaming service.
Apple responded to the EU’s findings in a statement to The Verge:
Spotify has become the largest music subscription service in the world, and we’re proud for the role we played in that. Spotify does not pay Apple any commission on over 99% of their subscribers, and only pays a 15% commission on those remaining subscribers that they acquired through the App Store. At the core of this case is Spotify’s demand they should be able to advertise alternative deals on their iOS app, a practice that no store in the world allows. Once again, they want all the benefits of the App Store but don’t think they should have to pay anything for that. The Commission’s argument on Spotify’s behalf is the opposite of fair competition.
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