Spotify CEO Daniel Ek has been lobbying the UK government, saying it should use its freedom from the EU to enact tough new laws to end Apple's dominance with the App Store.
Ek's lobbying comes as the UK considers a Digital Markets, Competition and Consumers Bill. Amongst other things, the bill might mean the country's Digital Markets Unit would be granted authority and powers — three years after it was set up.
Speaking to the Financial Times, Ek said that this was the time for the UK to step up, since it had left the European Union and was not bound by the laws of the vastly larger and more influential EU. The EU has already enacted a Digital Markets Act, and was key in Apple's decision to replace Lightning with USB-C in the iPhone 15 range.
Still, Ek insists that "[the] UK can be nimble right now and show leadership."
"The UK is now setting its own agenda [following Brexit]," he continued.
"I find it insane that [Apple and Google] essentially control how over 4bn consumers access the internet around the world," he said. "Not only are they dictating the rules, they also compete directly downstream with those providers."
Apple competes with Spotify through its Apple Music streaming service, but Ek has been arguing that Apple's offering doesn't have to pay the same 30% as other apps in the App Store. Spotify does not pay 30%, either.
In his Financial Times interview, Ek said that actually it's not the cost of using the App Store that is the problem. Rather it's that Apple is a gatekeeper, while also offering competing services.
"Imagine that this was a mall and literally half of the UK population is in this mall," said Ek. "That's where [having to pay App Store fees] becomes anti-competitive."
"This is for every single developer," he continued. "More and more of these developers are now finding that Apple is a competitor."
Separately, in July 2023, Spotify cut off all subscribers who were paying for the service via the App Store.
The UK voted to leave the EU in 2016. As well as failing to make its own COVID app after spending $15.6 million on the project, its efforts to control Big Tech since leaving most recently include it having backed down from an unenforceable online safety law.
In 2022, the UK did state that it would not be copying the EU's mandate for a common USB-C charger, except where it would, in Northern Ireland. The UK appeared to believe that Apple could therefore continue selling iPhones with Lightning connectors.
19 Comments
Spotify is in a business with razor thin margins. Ek and Spotify entered into that business and the only way to change that arrangement lies with Spotify and the record labels. Constantly attacking Apple isn't going to change that fact, since it's not doing anything illegal.
Spotify has already tried to develop services to supplement its music business the same way that Apple and Amazon have. They have just been less successful at it. Maybe more time in business development and less time in court and lobbying legislatures would help.
If you can't win in the marketplace, you can always find desperate politicians trying to distract from their own policy failures to do your dirty work for you.
The App Store model was based on what already existed on gaming consoles. The same company that created the hardware and OS for the console was also in control of the rules for how software could be released for the platform. The console maker would take a cut from 3rd party games and also release its own competing 1st party games. And gaming is the #1 revenue generator on iOS by a wide margin so it’s an appropriate parallel.
Point being that Apple didn’t set out to create a new anticompetitive business model. They used a model that was generally accepted in the gaming market and had also been upheld in an antitrust court case that involved Nintendo.
Who needs Spotify for anything? Just pony up and subscribe to Apple Music and resign redundant apps to the dustbin of history.
For the mall analogy, when and where is a mall free for the stores selling their products?