The European Union has fined Apple over 1.8 billion euros for abusing its dominant position in the market for distributing streaming music apps to iPhone and iPad users through its App Store.
The investigation by the European Commission found that Apple applied restrictions on app developers that prevented them from informing iOS users about alternative and cheaper music subscription services available outside the app.
The sanction is linked to a complaint filed by Spotify in 2019, in which they pointed out that Apple's App Store rules were deliberately limiting choice and inhibiting innovation, affecting the user experience. It also accused Apple, maker of the iPhone, of acting to the detriment of other app developers by playing a dual role as both participant and judge in the app store ecosystem.
In June 2020 , the Commission opened a formal proceeding on Apple's rules for app developers on the distribution of apps through the App Store. In April 2021 , the Commission sent Apple a Statement of Objections, to which Apple responded in September 2021.
In February 2023, the Commission replaced the 2021 Statement of Objections with another Statement of Objections clarifying the Commission's objections, to which Apple responded in May 2023.
As a result, Apple faces a payout of approximately €40 million for failing to comply with EU regulations, in addition to another €1.8 billion intended to compensate for the harm caused to consumers due to its policies. This amount represents about 0.5% of Apple's total reported revenue in 2023. It is estimated that the fine could have been as high as 10% of that figure, the maximum limit set by the Commission for this type of punitive measure.
"Apple's conduct, which lasted nearly ten years, may have led many iOS users to pay significantly higher prices for streaming music subscriptions due to the high commission imposed by Apple on developers and passed on to consumers in the form of higher subscription prices for the same service on Apple's App Store" they state in the release.
