Apple Fires Back At Spotify
Back in March Spotify filed an antitrust complaint with the EU over the 30% charge Apple imposes on subscription-based apps downloaded in its App Store. In the filing Spotify cast Apple as an avoidable barrier to user growth, which hurts consumer choice and unnecessarily increases the cost of streaming subscriptions. This week Apple formally replied to the EU with a whole different set of numbers.
The upshot of Apple’s counterargument is they don’t charge nearly as much for App downloads as Spotify claims. According to Apple it only receives revenue for 0.5% of Spotify’s premium listener audience and that Spotify only pays a 15% cut on those subscribers. Obviously you could drive a truck between the two sets of numbers, which means the truth is probably in the middle somewhere.
Now it’s up to the EU, who will begin a regulatory review to determine which party has a more valid argument. To me this one’s a coin toss. It’s hard to see Spotify not being available in the App Store, so you’d think Apple would have more power in this dispute. On the other hand, the EU has been aggressively regulating (and fining) Google and Facebook over the past two years, and Spotify is a European company. So maybe advantage Spotify?
We shall see . . .