Apple believes Spotify wants a free ride, and the EU may just give it to them

Spotify

The European Commission has been investigating Apple and how it handles competing developers like Spotify. The probe could result in a 500 million euro fine and additional regulation on how Apple handles business with its products and the App Store.

According to information provided to AppleInsider by Apple, the company is concerned that the European Commission (EC) will rule in Spotify's favor and give it even greater control of the streaming market. After a decade of investigations, Apple claims the EC has failed to find anything proving Apple has caused consumer harm or anti-competitive behavior.

Spotify pays Apple zero commission thanks to its reader app status and has access to many Apple technologies for the price of a $100 per year developer fee. Its apps work with thousands of Apple-provided APIs over 60 frameworks.

Despite that, Spotify wants even more control on iOS to increase its profits even more. The latest attempt for Spotify to get a favorable EC ruling relies on targeting Apple's anti-circumvention rules.

Apple provided a statement to AppleInsider on the matter:

"We're happy to support the success of all developers — including Spotify, which is the largest music streaming app in the world. Spotify pays Apple nothing for the services that have helped them build, update, and share their app with Apple users in 160 countries spanning the globe. Fundamentally, their complaint is about trying to get limitless access to all of Apple's tools without paying anything for the value Apple provides."

The push from Spotify since 2013 is unprecedented, having met with the EC at least 65 times. Its arguments paint itself as an underdog, but the numbers show otherwise.

Apple Music occupies only 11% of the streaming market in the EU, while Spotify dominates at 56%. Apple is the fourth most popular streamer after Spotify, Amazon Music, and YouTube Music.

Apple believes there isn't any evidence of anti-competitive behavior or consumer harm. Consumers have plenty of choices, and the streaming market is thriving.

Another argument that's being made is that customers don't know how to subscribe to music services outside of an app. This argument doesn't seem to hold any weight as Spotify grew over the past decade, even before Apple introduced new App Store rules.

Spotify can directly email customers with offers for premium plans and does so. The company so far hasn't taken advantage of the in-app link to external subscriptions, but it is considered a reader app, so account creation and subscription can take place outside of the iPhone app.

No judgment from the EC has been made yet, but clearly, Apple expects a ruling in Spotify's favor. What this means for Apple's existing business model remains in question.