Breaking: The US Government Is Officially Up Apple’s Posterior Orifice…

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If Goldman Sachs can bring down Greece, they can definitely touch Apple Music.  Which brings us to Goldman-backed Spotify, whose team of six different lobbyists is now becoming an albatross for an already-troubled Apple Music launch.

According to details emerging this morning, a Spotify-charged, government probe of Apple Music is now entering a new phase, with the involvement of the Federal Trade Commission (FTC).  That is, the federal, US Government FTC.

The Verge has specifically pointed to subpoenas against Apple from the FTC, though at this point we’re unsure of their exact nature.   Just recently, Spotify urged their users to bypass Apple’s 30 percent App Store cut on Spotify subscriptions, a move that brazenly violates Apple’s terms of service but reflects the type of chutzpah that comes from clout on Capitol Hill and Washington.

And just for the record, bypassing Apple’s in-app subscription requirement is definitely not permitted under Apple’s TOS (though for now, they’re letting it slide)…

“Apps that link to external mechanisms for purchases or subscriptions to be used in the App, such as a “buy” button that goes to a web site to purchase a digital book, will be rejected.”

 

Apple App Store review guidelinessection 11.13.

The subpoenas represent another major roadblock in major label plans to limit free access on streaming services.  Initially, Apple’s decision to limit free access to a three-month window was considered a starting point to pressure rivals like Spotify to do the same.  Throughout, Spotify has been staunchly resistant to such efforts, especially given the competitive disadvantage it spells against Youtube.

Unfortunately for the co-conspiring ‘Big Three,’ quick investigations from state attorneys general in New York and Connective kiboshed that effort.  That represented a clear, initial victory for Spotify’s nascent present in Washington.

More as it develops!

Image by Troy Trolley, licensed under Creative Commons Attribution 2.0 (CC by 2.0).

15 Responses

    • NewBossWorseThanOldBoss

      Die Spotify, Die !
      I’m cancelling my Spitify subscription.

      Reply
  1. DavidB

    I don’t know whether Spotify are breaching Apple’s TOS, but they are not breaching the term you have quoted, because they are not putting a link in the app.

    Reply
    • Paul Resnikoff
      Paul Resnikoff

      That’s a point, thought I’m not sure linking through a direct email (that you captured most likely via the App Store) qualifies as an acceptable workaround.

      But why shouldn’t Spotify have to pay? After all, Spotify didn’t spend the capital, the hundreds of millions, maybe billions, required to develop the iTunes Store and App Store. That requires massive investment, not to mention considerable risk, and it’s a platform that Spotify spend $0 contributing to.

      Indeed, Apple was investing the massive R&D and taking the gigantic risk to launch the ‘Apple Music Store’ back in the early 2000s. Is Spotify going to compensate Apple for the sunk cost, and for taking such a huge chance?

      So why does Spotify get a free ride, then? It’s not a public utility, and Apple isn’t a charity. Just like Spotify isn’t a charity, they should pay for what they use.

      Reply
      • Ariel

        Pretty amazing comment. Poor Apple. They built the infrastructure for their competitors to use and now their ungrateful direct competitors are trying to avoid pay them for it. How unfair!

        To me it looks like the exact opposite. Apple tried as hard as it could to entirely monopolize the smartphone and the app-on-phone market, and they’ve had less than 100% success.

        I’m sorry, but how is Apple a good guy in any way? Its a for-profit company like Spotify.

        And sidenote, didn’t Apple ripoff Spotify’s entire product?

        Reply
        • Remi Swierczek

          Two intoxicated by Daniel Ek’s DOPE “power houses” continue contraction of $200B of obvious to zombie music goodwill to $15B of subs. Now congress is involved in pushing the industry over the cliff – WOO I am impressed. Then YouTube advertising DOPE will demolish this brilliant contraction accomplishment with $5B of ads.
          Welcome to $20B MUSIC INDUSTRY in 2025! (Inflation adjusted 1999 = $60B)

          Doug Morris and Lucian Grainge should voluntarily QUIT NOW.
          Doug at Sony should have some Japanese honor by now.

          Reply
      • Ariel

        And Paul, I love your site and I respect your journalism. But I don’t pay for it. It’s not malice. It’s supply and demand. It’s hard to charge for text/information on the Internet because it’s so bountifully abundant. So I think it’s just strange to pretend like Spotify and filesharers and whoall else are just immoral scumbags who don’t care about artists. There’s been a fundamental change in the value of copies of media, zero marginal cost, etc. I’m sure you’ve heard this argument. Recreating a system where supplies are limited seems silly and would require SOPA-like Internet controls. Like, pandora’s box is open. Can’t we discuss how to pay people in the post-scarcity world, rather than making normative statements about who should — in theory, absent market forces — pay for what.

        Reply
  2. Anonymous

    so how long until digitalmusicnews.com just automatically redirects to theverge.com?

    Reply
  3. Anonymous

    Google is going to buy Spotify, and already is on their board. As I’ve said numerous times, Google has purchased all the US politicians.

    You folks get the government you deserve.

    Reply
  4. Alex

    The industry is against the freemium on-demand model since it pay artists less. Even less money than the paid subscription model, if you thought it wasn’t possible.

    Spotify is promoting a culture of entitled millennial smoochers.

    Reply
    • Name2

      Millenials have been smooching for, well, millenia.

      I think the word you’re looking for is “moochers”.

      Reply
  5. Ariel

    Your commitment to Apple’s TOS is truly inspiring. Fair is fair. Spotify should continue to smilingly throw a cut of their revenue to their direct competitor because it also happens to control the app/phone ecosystem. Ethics!

    Also, Spotify probably supports the FTC action and they probably lobbied for it, but the government easily have told them to fuck off. It’s not a Spotify action if the government agreed with them. Apple has lobbyists too, believe it or not.

    Reply
  6. For Paul

    Glad someone else pointed out Spotify didn’t break the terms. The app doesn’t allow a user to purchase outside of the app store, that’s all there is to that. The email is an email. There are lots of apps that let users pay directly from their websites.

    Apple made their huge investment to sell hardware, plain and simple. Any money they earn in the app store is gravy but their sole purpose was creating something to help sell more phones and boost their overall ecosystem. It wasn’t to get rich off 30% cuts when they already allow hundreds of thousands of free useless unsuccessful apps to sit there in the store.

    Reply

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