Spotify CEO Daniel Ek Speaks Out on Dispute With Apple Over App Store Policies

Spotify CEO Daniel Ek elaborated on his company's complaint against Apple with the European Commission in a speech today at the International Conference on Competition in Berlin, according to Variety and The Hollywood Reporter.

spotify complaint apple eu
Spotify has accused Apple of unfairly applying its 30 percent App Store commission. While a 70-30 revenue split applies to most apps, including Spotify, others like Uber and Deliveroo are exempt since Apple's commission does not apply to "goods or services that will be consumed outside of the app."

Ek doubled down on this issue, referring to Apple's commission as a "competitor tax":

Let's call this 30% revenue-share exactly what it is – a competitor tax. Importantly, Apple's posture towards Spotify became increasingly hostile after Apple acquired a rival music streaming service and launched Apple Music. But until now, we felt like we didn't have much of a choice.

Spotify Premium normally costs $9.99 per month, the same price as ‌Apple Music‌, but if Spotify were to offer that price on the ‌App Store‌, it would only receive $6.99 of that amount after Apple's cut.

Spotify did experiment with offering Premium for $12.99 per month through its iOS app starting in 2014, netting it $9.09 per subscriber after Apple's cut, but this put it at a competitive disadvantage since ‌Apple Music‌ is $9.99 per month. Spotify has since stopped allowing upgrading to Premium through its iOS app.

As we all know, iOS and the ‌App Store‌ is the only way to offer our service to anyone with an iPhone or iPad. That's over a billion people around the world. So not being on their platform is just not an option for us — or really for any competing internet service in this day and age. Apple knows this.

If we wish to use Apple's payment system to allow our customers to upgrade to our Premium service, we must pay that 30% tax. This means we cannot be price competitive because we are forced to increase our cost to consumers … while Apple avoids the tax all together and can offer ‌Apple Music‌ at a much lower, more attractive rate. This is especially damaging to a company like ours who already pays out a significant portion of our revenues to record labels and music publishers.

The issue doesn't end there, as Apple's ‌App Store‌ review guidelines prevent Spotify from letting users know that they can subscribe to Premium for $9.99 per month on the web or other platforms. The guidelines also prevent Spotify from advertising discounts and other promotions in its iOS app.

We are essentially faced with a "gag order" that prevents us from communicating with our own users about our service. From dictating how we communicate with our own customers to imposing an unjustified tax, Apple isn't playing fair. Let me be clear: we have no desire to step into the spotlight on this issue. But we also believe we have no other choice.

Ek concluded with a ping-pong metaphor:

It's like inviting you to a match on our ping-pong table and then forcing you to play blindfolded while we change the rules throughout the game.

On a new website titled Time to Play Fair, Spotify also says it is not allowed to be on the HomePod or Siri, along with other accusations.

Spotify is aiming for all apps to be subject to the same fair set of rules, including ‌Apple Music‌. Spotify also believes consumers should not be "forced to use systems with discriminatory tariffs such as Apple's" and that Apple should not be able to place "unfair restrictions" on marketing and promotions.

Tag: Spotify

Top Rated Comments

BrettArchibald Avatar
28 months ago
What I'm hearing from Spotify is: "Apple did a lot of work creating this fantastic distribution platform and Apple did a lot of work creating a fantastic integration between their Store and their devices and Apple amassed a huge database of satisfied returning customers, but now WE want to benefit from all that for nothing."
Score: 67 Votes (Like | Disagree)
AppleFan1179 Avatar
28 months ago
This is incredibly similar to what got Microsoft in trouble with IE back in the day. When you are the OS and by extension the platform, you are put in a special position where you have to play fair, even with your competitors. Apple is not playing fair, and Spotify is exactly right to complain about it. Compete on the service, don't compete on business leverage.
Score: 50 Votes (Like | Disagree)
Stevez67 Avatar
28 months ago
So then the Spotify argument is that unless Apple provides the App Store for free everyone except Apple is at a competitive disadvantage. Explain where else in the world a store, online or brick & mortar, lets someone else sell a product in their store without taking a cut (normally called a mark-up). Gotta call BS on Spotify's argument.
Score: 36 Votes (Like | Disagree)
DNichter Avatar
28 months ago
Pretty silly. Spotify wants to use Apple's platform and customer base, which they have worked hard to develop and cultivate for years, to make money. Yet, they don't want to pay Apple a cut for providing this platform and customer base? If you don't want to pay it, you don't have to, but don't expect to use their platform for free.
Score: 31 Votes (Like | Disagree)
Ishayu Avatar
28 months ago
I agree that Apple aren't being fair in this field. Whether or not they can be sued for it is a whole another matter, but we've now reached a point where dozens of high profile companies are trying to dodge around Apple's revenue sharing systems, from HBO to Spotify etc. etc. Even Disney and Pixar are mad, and the latter of those companies was founded by, among others, Steve Jobs

There is no way that Apple receiving a 30% cut is fair in a scenario such as this. Apple is not offering any services other than billing the customer, for which 30% is massively, massively too high. They don't host the music, they don't pay for the bandwidth, they don't offer the catalogue, they don't protect customer nor provider from anything whatsoever. The only thing they've provided is the platform iOS. If Microsoft can have an anti-trust case just by pre-installing Internet Explorer, surely this more than qualifies as an anti-trust case.
Score: 26 Votes (Like | Disagree)
matc Avatar
28 months ago
I'm completely with Spotify on this one. Apple should compete by just building better products - and they used to do exactly that. Let the customer decide.
Score: 23 Votes (Like | Disagree)

Top Stories

tracking disabled ios 14 5

Analytics Suggest 96% of Users Leave App Tracking Disabled in iOS 14.5

Friday May 7, 2021 1:51 am PDT by
An early look at an ongoing analysis of Apple's App Tracking Transparency suggests that the vast majority of iPhone users are leaving app tracking disabled since the feature went live on April 26 with the release of iOS 14.5. According to the latest data from analytics firm Flurry, just 4% of iPhone users in the U.S. have actively chosen to opt into app tracking after updating their device...
macbook colors 3d black bezels

Prosser: Next MacBook Air Could Come in Colors Similar to iMac

Friday May 7, 2021 6:55 am PDT by
According to Apple leaker Jon Prosser, Apple's upcoming release of the MacBook Air will feature various colors, similar to the colors in the newly released 24-inch iMac. In the latest video of his YouTube channel Front Page Tech, Prosser says the same source who accurately provided him information on the first Apple silicon iMac coming in colors has told him that he recently saw a prototype...
tile amazon sidewalk integration

Tile to Leverage Amazon Echo and Ring Devices to Better Compete With AirTags

Friday May 7, 2021 2:07 pm PDT by
Amazon today announced that it is teaming up with Tile to add Amazon Sidewalk integration to Tile's Bluetooth trackers. Amazon Sidewalk, for those unfamiliar, is a network of Amazon Bluetooth devices that's designed to improve the connectivity of devices like the Ring and Amazon Echo. Tile will now be joining Amazon Sidewalk, and through this integration, Amazon Echo and Ring devices will be ...
Top Stories 59 Feature

Top Stories: Epic Games vs. Apple, Hidden AirTag Mode, Apple Music Hi-Fi, Colorful MacBook Air?

Saturday May 8, 2021 6:00 am PDT by
While we wait for the newly introduced iMac, iPad Pro, and Apple TV models to launch later this month, this week saw the kickoff of the big Epic Games v. Apple trial, with lots of juicy tidbits coming out as the two sides make their arguments. This week also saw some rumors about a Hi-Fi tier for Apple Music, more biometric sensing capabilities for Apple Watch, and timing for the...
zoom app icon

Apple Gave Zoom Access to Special API to Use iPad Camera During Split View Multitasking

Sunday May 9, 2021 2:00 am PDT by
Zoom, a hallmark platform used by millions during the global health crisis, has been given access to a special iPadOS API that allows the app to use the iPad camera while the app is in use in Split View multitasking mode. This case of special treatment was first brought to attention by app developer Jeremy Provost, who, in a blog post, explains that Zoom uses a special API that allows the...
snapchat dark mode

Snapchat Rolls Out Dark Mode on iOS

Wednesday May 5, 2021 1:17 am PDT by
Nearly two years following the release of iOS and iPadOS 13, which included native, built-in, and systemwide dark mode, Snapchat, one of the world's most prominent social media networks, has finally rolled out a dark mode theme for iOS users. Snapchat began testing a dark mode theme of its app design late last year with a small group of iOS users. Now, Snapchat says that as of this week, it...
tile sticker e1570533758981

Tile CEO: 'We Welcome Competition From Apple, But We Think It Needs to Be Fair'

Tuesday May 4, 2021 9:51 am PDT by
Just after Apple announced its AirTags, Tile CEO CJ Prober relayed his concerns about competing with Apple in the tracking space, and said that Tile would ask Congress to investigate Apple's business practices specific to Find My and item trackers. Prober this week did an interview with Bloomberg, where he further expanded on Tile's complaints about Apple and why he feels that Tile is...
fortnite apple logo 2

Epic CEO Tim Sweeney Admits App Store's 30% Cut Is Similar to Consoles, Would Have Accepted Special Deal With Apple

Tuesday May 4, 2021 1:54 pm PDT by
Apple's legal battle with Epic Games is continuing on, and during the second day of the trial, Epic Games' CEO Tim Sweeney continued his testimony against Apple. Sweeney was grilled by Apple's lawyers, and made several points seemingly favorable to Apple. In addition to mentioning how he prefers Apple's iPhone and values Apple's privacy policies that he's aiming to dismantle, Sweeney...
signal instagram ads3

Signal Shares the Instagram Ads Facebook Doesn't Want You to See

Wednesday May 5, 2021 1:29 am PDT by
Encrypted messaging app Signal has had a series of Instagram ads blocked from the social media platform, after it attempted to show users how much data the Facebook-owned company collects about them and how it's used to push targeted ads. In a blog post, Signal described how it generated the ads to show users why they were seeing them, simply by declaring upfront the information that the...
iphone 12 preorder purple

Apple Begins Transition to Randomized Serial Numbers With Purple iPhone 12

Wednesday May 5, 2021 9:17 am PDT by
MacRumors previously reported about Apple's plan to switch to randomized serial numbers for future products starting in early 2021, and this transition has now started with the new purple iPhone 12 model in multiple countries. With assistance from Aaron Zollo, host of the YouTube channel ZolloTech, we can confirm that the purple iPhone 12 released last month has a new 10-character serial...