The European Union fined Apple 1.8 billion euros (£1.5 billion) after an investigation found it had limited competition with music streaming services such as Spotify.
The fine, which is nearly four times higher than expected, signals that the European Commission will take decisive action against technology companies that abuse their dominance in the mobile phone and online services markets.
EU Competition Commissioner Margrethe Vestager said the smaller fine amounted to nothing more than a “parking fine” and was intended to act as a “deterrent” to such practices by Apple and other companies.
“I think it’s important to see that if you are a dominant company and you do something illegal, you will be punished. We want to show our determination that we will investigate these cases.”
She said the public ended up paying more than they should for music streaming because of anti-competitive behavior.
“Apple’s rules ultimately harm consumers. Key information is withheld, preventing consumers from using it effectively or making informed choices. Some consumers may have paid more because they didn’t know what to expect outside of the app. By subscribing, they can pay less.”
The commission found that the tech company contractually disadvantaged users by restricting app developers from publicly promoting cheaper services.
“Music streaming developers are prohibited from telling users within their apps about cheaper prices for the same subscription on the Internet,” which is an “anti-bootstrap” practice, she said.
“They are also not allowed to change the link in the app where consumers go to their website and pay lower prices there,” she told a news conference in Brussels.
“The investigation found that Apple prohibits developers of music streaming apps from fully informing iOS users of alternative and cheaper music subscription services available outside the apps, and from providing information on how to subscribe to such services,” the European Commission said in a statement. Any description of the Services. In particular, anti-bootstrap clauses prohibit application developers from doing so.
“For decades, Apple has restricted music streaming app developers from informing consumers about cheaper options available outside of their apps, and has done so under contractual obligations,” Vestager said.
The investigation, launched after a complaint from Spotify, focuses on a restriction that prevents developers from telling iPhone and iPad users alternative ways to bypass Apple’s subscription to its music streaming service.
Spotify argued that the restrictions benefit Apple Music, its rival music streaming service.
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Spotify and other app providers have long criticized Apple’s App Store, which they say stifles competition by charging a 30% fee on apps and in-app purchases.
However, Apple has announced plans to allow EU customers to download apps to iPhones outside of the App Store in response to the introduction of the EU Digital Markets Act (DMA), which aims to regulate major technology companies such as Apple, Microsoft and Mark Zu Kerber’s Meta.
In response to the fine, Apple said: “The Commission made this decision despite finding no credible evidence of consumer harm and ignored the reality of a booming, competitive and rapidly growing market.
“The main advocate and biggest beneficiary of this decision is Spotify, a company based in Stockholm, Sweden. Spotify owns the world’s largest music streaming app and met with the European Commission more than 65 times during the investigation.
“Today, Spotify holds 56% of the European music streaming market, more than twice as much as its nearest competitor, and it pays nothing to Apple for the services that make Spotify the world’s most popular music streaming service. One of the most well-known brands. Much of their success is due to the App Store, and all the tools and technology Spotify uses to build, update, and share its apps with Apple users around the world.
