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Apple Agrees to EU Antitrust Demand in Fight on App Payment

In Technology
April 06, 2024

(Bloomberg) — Apple Inc. said it has accepted European Union demands to stop preventing music-streaming apps from informing users of deals away from the company’s App Store, although it will still charge a fee on those sales.

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The Cupertino, California-based iPhone maker said Friday that music streaming apps on its App Store in Europe can now include a link to the developer’s website, informing users of alternative ways of buying subscriptions. The announcement came after the company was hit with a €1.8 billion fine from Brussels regulators for alleged abusive behavior.

But in a move that could spark opposition from complainants, Apple said it intends to go ahead and charge a commission of as much as 27% on app sales made on a developers’ web page, after a user has clicked on an external link from the app and made a purchase within seven days.

The European Commission in March ordered Apple to strike out what it regarded as abusive terms in its contracts with music developers and slapped the company with a hefty fine for the practice after a lengthy investigation originally sparked by Stockholm-based Spotify Technology SA. The music streaming app claimed it was forced to ramp up the price of its monthly subscriptions to cover costs associated with Apple’s alleged stranglehold on how the App Store operates.

At the time Apple slammed the EU’s decision, vowing to appeal the order. In a statement, the company said regulators failed to “uncover any credible evidence of consumer harm, and ignores the realities of a market that is thriving, competitive, and growing fast.”

Apple, which previously charged as much as 30% on app sales, said Friday that the commission’s decision didn’t apply to the company’s fee structure.

Spotify said Apple hasn’t complied with the commission’s order to let music streaming developers “communicate freely” with their users. “Following the law is not optional, but Apple continues to defy that decision,” Spotify spokesperson Jeanne Moran said in a statement. “It’s time for decisive action to once and for all give consumers real choice.”

The European Commission didn’t immediately respond to requests for comment.

–With assistance from Mark Gurman.

(Updates with comments from Spotify in the seventh paragraph.)

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