Wesley Hilliard
Apple stopped Spotify from circumventing its App Store fees for audiobooks, and now, Spotify is allegedly speaking with the British competition watchdog over the incident.
Spotify wants to sell audiobooks within its app by sending customers to its website. Apple doesn't allow this for individual goods, though a rule was passed to allow subscription services to link to the external subscription page.
After denying Spotify several app updates, the streamer finally complied and removed audiobook purchases from its app. However, according to a report from The Telegraph, Spotify wants this latest problem investigated by the British Competition and Markets Authority.
It isn't clear exactly what occurred per the report, but Spotify allegedly met with the CMA to raise concerns about Apple's decision to block app updates. An anonymous source reports that Spotify executives called on the CMA to accelerate its inquiry into the Apple.
The CMA is currently gathering evidence for a case against Apple and its App Store practices. It shared its initial findings earlier in 2022 after over a year of evidence gathering.
It concluded that Apple and Google have a stranglehold over digital app and content distribution. The CMA picked up two additional investigations into Apple's browser and cloud gaming rules, as well as a promise to continue App Store related investigations.
Extended investigations
The CMA site was updated to show it has extended investigations into Apple and its App Store as of October 31, 2022. This information gathering and data analysis portion of the investigation has been extended into January 2023.
While the timing lines up with the report, it isn't clear if Spotify spurred the extension for investigation or not. The anonymous tipster only suggested that the company had met with the CMA a week prior to the report.
There are strict rules in place for developers to ensure Apple gets a 30% cut on all in-app purchases, subscriptions, or digital goods sold on iPhone. There are some exceptions, like for Amazon, which sells physical goods in its store, or for so-called "reader apps" with in-app content like Netflix.
Spotify seemingly wanted to take a similar approach to Amazon Video, which has an exemption for in-app video purchases via a special rule. This rule is only applicable to certain premium video providers and doesn't extend to content like audiobooks on Spotify.
Expect Apple, Spotify, and various antitrust watchdogs to continue arguments over digital content distribution and payments without end. The CMA is expected to release more details and decisions over its investigation in January 2023.
William Gallagher
Christine McKee
AppleInsider Staff
Chip Loder
Malcolm Owen
4 Comments
Spotify is not a viable business. Stock price is less than 50% of where it was five years ago. It's barely running cash positive after all these years. Audio book initiative is DOA
Net net, they are executing their back-up plan of constantly accusing Apple of being a monopoly
The funniest thing is that people in the EU actually consider this a "EU technology company". Sad!
Spotify fits in with the current short term thinking own nothing philosophy.
This is a new thing. Creatively defining what the relevant market is so that you can accuse a company of being a monopoly. Spotify can't say that Apple is monopolizing the market for mobile apps so they have to complain that Apple is monopolizing the market for Apps sold through Apple mobile devices. (Even though Apple doesn't enjoy a monopoly in mobile devices.) Apple does enjoy the rewards of selling devices that a lot of buyers deem to be the superior product, but then if we are to keep the benefits of the free enterprise system, we cannot have a law that prohibits holding a "monopoly in high quality products".
I don’t agree with the monopoly claims but I do agree with this abuse of the subscription process in this particular case. It isn’t as though the cash flows through an Apple account like it would a retail store.