What’s Happening: European Commission Case and Digital Markets Act
The European Union has led the way on stopping Apple’s harmful anticompetitive practices with its Digital Markets Act (DMA) and its ruling on the music streaming services case.
The @EU_Commission finally ruled against Apple today. A lot of you have been asking for my take on what this means and what will – and won’t – change. I made a video with my thoughts including why this is a good first step, but also why there’s still more to be done. pic.twitter.com/pdICn2Jq6S
— Daniel Ek (@eldsjal) March 4, 2024
European Commission Music-Streaming Case
In March 2024, the European Commission announced the results of its years-long investigation into Apple’s anticompetitive practices against other music-streaming services: Apple’s App Store rules are abusive, and they harm consumers and music-streaming services alike.
The impact? A fine against Apple of €1.84 billion, and clear expectations the company must change its unlawful behavior. We are beginning to see some progress — in August 2024, Spotify was finally able to offer iPhone consumers in the EU pricing information for streaming plans in the Spotify app, and the fact that they can go to the Spotify website to purchase items.
What’s next? The fight continues. iPhone consumers everywhere deserve basic information about how much things cost, when they can take advantage of great deals and promotions, and where to go to buy those things online. The EC’s decision was the result of Spotify’s 2019 complaint encouraging the EC to help ensure a level playing field under European law. If the European Commission properly enforces its decision, iPhone consumers could see even more wins, like lower cost payment options and better product experiences in the app.
DMA: Regulation
The DMA is a landmark law on competition in the EU, that went into effect in March 2024.
If properly enforced, it could give consumers in the EU important new protections from frustrating roadblocks that are erected by a few powerful digital gatekeepers like Apple. And if it’s properly enforced, it could be a catalyst that can help ensure a fair and open digital economy for consumers and developers everywhere.
However, Apple recently imposed new terms as its “idea for compliance” with the DMA, that are illegal and unworkable for developers.
They include a fee of up to 17% of each transaction and charging developers a €0.50 fee for acquired customers. It’s not feasible for developers like Spotify to opt into these new terms, and so unfortunately, Spotify is not able to avail itself of the rights granted to developers under the DMA.
The European Commission announced preliminary findings against Apple for noncompliance, and it continues to investigate Apple’s rules and fees. The European Commission must be clear—Apple cannot be allowed to stifle competition and control consumers. As the DMA takes effect, EU consumers, creators, and developers deserve to be finally freed from Apple’s chokehold.
FAQs
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What does the March 2024 decision from the European Commission on the music-streaming case mean for Spotify and for Apple?
The EC’s decision is clear: that Apple is barred from enforcing its unlawful anti-steering provisions that restrict consumer information. As a result, starting in August 2024, Spotify is opting into Apple’s “entitlement” for music streaming services, created after the European Commission’s ruling. iPhone consumers in the EU will now see pricing for streaming plans in the Spotify app, and the fact that they can go to our website to purchase items directly. This is the beginning of progress — If the European Commission properly enforces its decision, iPhone consumers could see even more wins, like lower cost payment options and better product experiences in the app.
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How do Apple’s actions harm competitors?
Apple uses its platform dominance to unfairly penalize its competitors because they provide the same offerings. Consumers benefit when different players compete, and it’s not Apple’s role to decide who those players are. Apple must stop interfering and let competition work. The EC’s decision shows that when you create—and enforce—a level playing field, the consumer will win.
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What comes next?
While we are beginning to see progress, the fight continues against Apple’s bad behavior toward music streaming services and other developers around the world. iPhone consumers still deserve the basic product experiences they expect in their apps – experiences that users of other phones already enjoy. Unfortunately, Spotify and all music streaming services in the EU are still not able to freely give consumers a simple opportunity to click a link to purchase in app because of the illegal and predatory taxes Apple continues to demand, despite the Commission’s ruling.
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The EC decision and the DMA only impact EU consumers. What needs to happen for the same protections to exist globally?
We’ll keep fighting for a truly fair digital marketplace globally—because freedom from gatekeepers means more choice for consumers and positive impact for artists, authors, creators and developers everywhere.
