Photo Credit: Magnus Höij / CC by 2.0
Last week, Apple officially unveiled an App Store concession for “reader” apps – including Spotify – as part of a major settlement involving the Japan Fair Trade Commission (JFTC). Now, Spotify higher-ups are expressing their dissatisfaction with the settlement, maintaining that it doesn’t go far enough, and touting sweeping regulatory legislation.
Apple’s newest App Store concession arrived just days following a $100 million settlement with a number of iOS developers that earn less than $1 million annually. Within this multimillion-dollar settlement, the iPhone developer agreed to change its communication rules regarding alternative payment methods – that is, payments handled off the App Store and, in turn, exempt from the digital marketplace’s fees.
On the latter front, the Cupertino-headquartered company in June updated the App Store rules to enable developers to communicate with customers outside of apps, but it wasn’t until the $100 million settlement that the involved professionals could discuss (and link to) alternative payment options.
The aforementioned reader-app concession, on the other hand, stemmed from an investigation launched by the Japan Fair Trade Commission (JFTC) in 2016. Worth noting here is that similar investigations have initiated in 2021, with the German government having announced an antitrust probe into the App Store’s policies in June. And roughly two months before that, the European Commission formally accused Apple of distorting “competition in the music streaming market as it abused its dominant position for the distribution of music streaming apps through its App Store.”
Back to the reader-app concession, however, the compromise covers platforms with curated content libraries – including Kindle, Netflix, Spotify, and similar services, according to Apple’s definition.
As a result of the settlement (which will end the JFTC’s half-decade-long investigation), reader-app developers around the world (not solely in Japan) will have the option of linking to their own websites in-app, avoiding App Store fees by processing account sign-ups and payments internally, beginning sometime next year.
As initially noted, Spotify higher-ups, who’ve been vocal critics of Apple’s App Store “tax” and policies, have taken aim at the scope of the company’s latest concessions.
Spotify head of global affairs and chief legal officer Horacio Gutierrez – who in June described Apple as a “ruthless bully” – published a tweet on the subject, claiming that the “selective tweaks” to App Store rules “don’t go far enough.”
And Spotify CEO Daniel Ek, for his part, penned a similar message, writing: “This is a step in the right direction, but it doesn’t solve the problem. App developers want clear, fair rules that apply to all apps. Our goal is to restore competition once and for all, not one arbitrary, self-serving step at a time. We will continue to push for a real solution.”
Included with the longtime Microsoft attorney Gutierrez’s message – and Ek’s response tweet as a result – is a graphic entitled “Apple’s Proposed Settlement Does Not Address Anticompetitive App Store Practices.” Interestingly, instead of solely criticizing App Store policies, the resource compares the perceived limitations of Apple’s recent settlements and the perceived advantages of the Open App Markets Act.
U.S. lawmakers introduced the bipartisan Open App Markets Act about one month ago, and if passed and signed into law, the legislation would establish all manner of regulations and operational requirements for app stores that boast 50 million or more stateside users – the App Store and Google’s Play Store chief among them.
It bears noting in conclusion that Apple, which acquired classical music streaming service Primephonic last week, has long pushed back against criticism of its App Store fees – and particularly complaints levied by Spotify.
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