Apple fined €1.8B by EU for abusive App store rules for music streaming providers

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Key notes

  • The European Commission has ordered Apple to remove the anti-steering provisions and to refrain from repeating the infringement.

Regulators in the European Union have delivered a hefty financial blow to Apple today, levying a fine exceeding €1.8 billion against the tech giant. The penalty stems from Apple’s abuse of its dominant position in the iOS mobile app market, specifically related to music streaming services.

An in-depth investigation by the European Commission concluded that Apple engaged in anti-competitive practices by preventing music streaming app developers from fully informing consumers about cheaper subscription options available outside the App Store ecosystem. Termed “anti-steering provisions” by the Commission, these practices violate Article 102 of the Treaty on the Functioning of the European Union (TFEU).

Details of Apple’s Antitrust Violations

The Commission’s findings outline how Apple actively imposed restrictions that made it impossible for music streaming providers to:

  • Inform users about subscription offers and pricing differences outside the app.
  • Include in-app links directing users to external websites for alternative subscription options.
  • Contact new users via email or other means to educate them about other pricing or subscription plans.

The Commission concluded that these deliberate actions by Apple were neither necessary nor proportionate to protecting the company’s business interests. They directly harmed iPhone and iPad users, limiting consumer choice and potentially inflating music streaming subscription costs.

The Cost for Apple

The fine, based on the Commission’s 2006 Guidelines on fines, considers the prolonged nature of the infringement, Apple’s market share, and total revenue. Notably, the Commission added a significant lump sum to the initial fine to ensure the penalty serves as both a punishment and a powerful deterrent for Apple and other companies of similar size.

Margrethe Vestager, Executive Vice-President in charge of competition policy, stated: “For a decade, Apple abused its dominant position in the market for the distribution of music streaming apps through the App Store… This is illegal under EU antitrust rules, so today we have fined Apple over €1.8 billion.”

Beyond the fine, the Commission has ordered Apple to cease these anti-steering practices and avoid similar behavior in the future.

More about the topics: apple, EC, spotify