Roger Fingas
The European Union on Thursday proposed a new set of laws governing platform holders like Apple, Amazon, and Google, intended to improve transparency and non-discrimination in relation to the smaller businesses that depend on them.
The rules could require Apple to provide more details on how it ranks items on the App Store, and why it removes some apps, according to Reuters. Businesses would also have the right to launch collective lawsuits if they feel transparency or non-discrimination rules have been violated. Companies like Apple would be obligated to appoint mediators to handle complaints, and take on at least half of related expenses.
The terms and conditions documents platforms publish would have to explain any preferential treatment given to first-party services over others. That might be particularly relevant in the case of Apple, which typically claims a 30 percent cut from in-app transactions but gets to keep all of the revenue from services like Apple Music.
Spotify has been particularly vocal about this discrepancy, complaining to the E.U. alongside several other companies that Apple Music has an inherent advantage over rival streaming services. Until recently Spotify was charging more for Premium subscriptions through the App Store to compensate for Apple's cut — to avoid confusion and complaints, it eventually removed in-app upgrades entirely, prompting people to sign up elsewhere.
Digital Music Europe — an organization representing firms like Spotify, Deezer, and Soundcloud — is pushing for a stronger anti-discrimination focus by the E.U.
"In order to be effective, the regulation must also address the discriminatory practices that arise when a platform provider is also the direct competitor with those third parties," said DME president Hans-Holger Albrecht.
The CCIA, a group representing companies like Amazon and Google, insisted that platform holders are already on the right track and that it's in their interest to maintain good relationships with client businesses.
"There is no evidence of a systemic problem that would justify regulation through the strongest legislative instrument available to the E.U.," the CCIA's Jakob Kucharczyk argued. "A more flexible approach, rather than an outsized, one-size-fits-all Regulation, would be more conducive to the growth of Europe's digital economy."
The proposed laws must still be approved by the European Parliament and member states, so there's no certainty any of them will take effect.
William Gallagher
Christine McKee
AppleInsider Staff
Chip Loder
Malcolm Owen
26 Comments
Spotify whining again. Have subscribers sign up via your website and then you keep 100% of the subscription fee.
Oh wait, then you wouldn't have nearly as many subscribers, since it's a PITA to leave an App, go to a website, create an account and enter your credentials/payment information. As opposed to the sheer ease-of-use that comes with signing up in-App.
Edited: I'd like to see this go to court and for Spotify to have to reveal numbers showing how many people sign up via the App and via their website. Especially at the beginning. I expect Spotify owes a lot of their subscriber base to iOS users who signed up in-App. Now that they have their subscriber base, they want to change the rules.
I wonder when the EU will start demanding a cut of Apple’s 30% operating fee. They continue to mettle in everyone’s business and have to line their pockets so why not. If they want to use the non discrimination card, then quit attacking US companies.
Companies like Apple should be left alone. Their first thought is customer satisfaction. Let the consumer decide where they want to shop.
If they're worried about rankings in digital app stores, what about product placement and displays in brick and mortar stores? For example, grocery chains are free to put their own 1st party brand products in the best position on the shelves of the stores or have big displays showcasing their own 1st party products and not their competitors etc. It's not that I don't think it's a good idea to keep a regulatory eye on these things, but more that there seem to be existing standards in the non-digital world that allow some of that type of "discriminatory" treatment.