THE EUROPEAN UNION will reportedly open a formal probe into Apple's App Store following Spotify's allegations that it puts other developers at a "deliberate disadvantage".
So says the Financial Times, which reports that the European Commission (EC) plans to launch a formal antitrust investigation into Apple's conduct "in the next few weeks" after surveying customers, rivals and others in the market.
This comes after Spotify in March filed an antitrust complaint alleging that Apple is giving itself an "unfair advantage" through its 30 per cent "Apple Tax", which sees the firm charging a 30 per cent fee toward any sales through its App Store, including subscription services.
"Apple requires that Spotify and other digital services pay a 30 per cent tax on purchases made through Apple's payment system, including upgrading from our free to our premium service," Spotify CEO Daniel Ek said.
"If we pay this tax, it would force us to artificially inflate the price of our premium membership well above the price of Apple Music. And to keep our price competitive for our customers, that isn't something we can do."
Alternatively, if Spotify to ditch Apple's payment system, Ek said that Apple "applies a series of technical and experience-limiting restrictions" on the company. Over time, this has also included "locking Spotify and other competitors out of Apple services such as Siri, HomePod, and Apple Watch."
Neither firm has responded to news of the EC's planned investigation, but Apple was quick to hit back at Spotify's complaint, arguing that Spotify wants all the benefits of a free app without being free.
"After using the App Store for years to dramatically grow their business, Spotify seeks to keep all the benefits of the App Store ecosystem — including the substantial revenue that they draw from the App Store's customers — without making any contributions to that marketplace," Apple wrote.
"At the same time, they distribute the music you love while making ever-smaller contributions to the artists, musicians and songwriters who create it — even going so far as to take these creators to court."
In its lengthy rebuttal, Apple also denied locking Spotify support from Siri, HomePod and the Apple Watch, and pointed out that the 30 per cent app tax at the crux of Spotify's complaint applies to the first year, after which it halves. µ
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