Apple in Breach of EU Competition Law, European Commission Finds

[jlc1978]

You can’t find one single evidence that Spotify or Epic want access to Apple Customers but theirs.

Really? Why have an app on the App Store if they do not want access to Apple's customer base? Granted, they want to make them their customers as well; but if they didn't want access to Apple's customer base they would simply not have an app for iOS.

So, again the question remains is how much can Apple charge for access to their customer (user) base.

As for access to a Telco's user base, Apple early on wanted it when they launched the iPhone and so gave ATT an exclusive in order to launch it. Now that the iPhone is widely adopted the situation has changed and the telcos need the iPhone.

It’s Apple who wants their customers and it does look like it is using its device business and market share along with its Meta Store to have leverage over them.

No, Apple simply wants to make money off of sending paying customers to Spotify; something that is not uncommon in business. I mean, if I send a customer to someone and they wind up buying a product I get a finder's fee.

Some judges might find it an abuse of market position.

Possibly, It will be interesting to see how it plays out; personally I don't think the iPhone user will benefit, i.e.e they will see no reduction in the costs to stream and Spotify will simply pocket any additional revenue (although since they charge more on the App Store that revenue delta may be very small) and may actually see an increase in the cost of being on the app store if Apple decides to change how it charges streaming services for access.

 

[Nuno Lopes]

Really? Why have an app on the App Store if they do not want access to Apple's customer base?

The App Store is a construct created by Apple, its the only way to for digital services to access their customers on their smartphone of choice, If there was any other way, probably they would choose another option. So they have little choice to reach 50% of their customers on smarphones, otherwise they may move to Apple services. Well, they can always let them without a fight right?

“No, Apple simply wants to make money off of sending paying customers to Spotify; something that is not uncommon in business. I mean, if I send a customer to someone and they wind up buying a product I get a finder's fee”.

Actually no. The App Store rarely generate a lead. At least with me. What I do is go to Google to find apps or services I want learn and than click on a link on the supplier website or search the App Store for the name of the app to download. So it’s actually the other way around more often then not. Digital services giving leads to the App Store with little option to do otherwise.

Taking this aside, if that is all they want tell them to close Apple Music, close Apple Arcade, close Apple TV+, close Apple News, close Apple Fitness. Good luck with that, they seam to be doubling down on those. You know what’s the rate of a payment service right? They already have one, Apple Pay, why not use that one?

Why is this so difficult to understand? Geezzz.

 

[I7guy]

[...]

You can’t find one single evidence that Spotify or Epic want access to Apple Customers but theirs.
[...]

Are you saying the Spotify or Epic have no interest in making Apple customers their customers also? Apple customers such as me, who don't subscribe to spotify, they don't want me as a customer?

 

[Nuno Lopes]

Are you saying the Spotify or Epic have no interest in making Apple customers their customers also? Apple customers such as me, who don't subscribe to spotify, they don't want me as a customer?

I think what I wrote here answers your question

Both Spotify and Epic did not set compete themselves with any of Apple’s businesses. Apple set it self to compete with them, one through Apple Music and another through Apple Arcade. It’s Apple who wants their customers and it does look like it is using its device business and market share along with its Meta Store to have leverage over them. Some judges might find it an abuse of market position.

1. Apple Music was built to compete with Spotify with fundamentally the same model. Spotify was already in operation fo years.

2. Apple Arcade was built to compete with other gaming services. Epic and others such have been in operation for years.

The crux of the matter is in bold in my quote. Its not so much in Apple entering with competing products, or Spotify competing with Apple Music etc , but in Apple using their device market share as leverage over existing businesses.

Don't recall Spotify or Epic coming up so hard before that. This will happen more and more as time progresses ... the late one is Fitness. It started to compete with Netflix and others, eBook Stores and so on ... all using mainly their device market share as leverage. Not only that but also baking in the OS purposely APIs out of reach of competitor to offer a better service.

There were companies following similar practices that were regulated in the US with the same justifications as Apple: https://en.wikipedia.org/wiki/United_States_v._Microsoft_Corp.

Microsoft Corp. v. Commission - Wikipedia

en.wikipedia.org

We have been here before. In effect, what Apple its doing is several order of magnitude more "aggressive".

In my opinion Apple is making a mistake and their followers aren't helping either. Because in trying to keep total control over the payment of third party digital services they will loose it if not more. Instead they could very well deal with it by themselves by stopping requiring the integration of in-app-purchase device in apps where digital services are concerned and offer alternative app hosting / review plans along with it. By doing this, the fundamental benefit of the App Store to customers would be untouched. They would still have total control over app curation, they could still assure quality ... so on and so forth. Third parties digital services would be free pursue the business models that best fit their business without the extra expense of things that they don't need or find benefit in using (In App Store Marketing, Universal Billing, Payment Processing, and so on).

The 50% market share instead of 80% might shield them in the US, but in the EU don't think it's the case.

Cheers.

 

[jlc1978]

The App Store is a construct created by Apple, its the only way to for digital services to access their customers on their smartphone of choice,

The key is "Apple's customers," not Spotify's, EPICs, etc.

If there was any other way, probably they would choose another option. So they have little choice to reach 50% of their customers on smarphones, otherwise they may move to Apple services.

There is - a web player. But they want the benefits of an app.

Well, they can always let them without a fight right?

Sure, but the market is too lucrative.

“No, Apple simply wants to make money off of sending paying customers to Spotify; something that is not uncommon in business. I mean, if I send a customer to someone and they wind up buying a product I get a finder's fee”.

If that is all they want tell them to close Apple Music, close Apple Arcade, close Apple TV+, close Apple News, close Apple Fitness. Good luck with that, they seam to be doubling down on those. You know what’s the rate of a payment service right? They already have one, Apple Pay, why not use that one?

What's your point? Apple can sell their own product as well as other's and make money off of them, just as I do. Nothing says they can't do both, and they do.

Why is this so difficult to understand? Geezzz.

It's not. If you want access to Apple's iOS / iPad customer base yo will have to pay Apple for it. How Apple chooses to charge may change, but they will get paid.

 

[Nuno Lopes]

The key is "Apple's customers," not Spotify's, EPICs, etc.

If you say so. But I though the key to business to bring best user experience and innovation to whatever area of human enterprise.

There is - a web player. But they want the benefits of an app.

Bringing the best experience possible I think who benefit are Apple devices users that use digital services. Which, lets face it, its all of them.

But wait a minute … are you saying that Apple doesn’t care hurting their devices customers, case in case the ones that user Epic or Spotify in order to steer them to use Apple’s digital services? With 50% market share, some people might look at it has blackmail.

Anyway interesting.

Sure, but the market is too lucrative.

Yes. Just build an app and the money pours in. Kekek.

What's your point? Apple can sell their own product as well as other's and make money off of them, just as I do. Nothing says they can't do both, and they do.

My point is quite clear.

It's not. If you want access to Apple's iOS / iPad customer base yo will have to pay Apple for it. How Apple chooses to charge may change, but they will get paid.

Of course they will get payed always for their products and services. That is out of the question. Are you ok?

But wait a minute … I thought App Store sold products and services. But now what you are saying is that they sell access to people that bought the devices in good faith. It kind of looks like those businesses that sell tickets for people to go to the circus totally unaware that after all there is another show going where their are the main attraction. You know, businesses like Facebook.

Here is what Tim Cook said while critiquing Facebook:

“The end result of all of this is that you are no longer the customer," said Cook. "You are the product."
"We believe that ethical technology is technology that works for you" said Cook.

Apple has been touting using its browser to deliver web apps as an alternative. Well, Safari iOS PWA support is the most limited in the mainstream browsers.

Yet they blocked xCloud from being in the App Store making demands such as requiring them to post every game stream as Apps on their App Store. Which is of course nonsense.

I just don’t know how this “works for you”, the device user, is being applied here so I find it hard to find the ethics in technology in this context.

Has an avid Apple devices user and some services of theirs, I’m glad you aren’t heading the company. I totally trust that Apple will do the right thing for devices users, their customers, on this matter. There are other ways to build a successful business, I totally agree with Tim Cook on that one. Hopefully they will come with more creative and just policies for their App Store that don’ t use their customers as a product.

 

[I7guy]

I think what I wrote here answers your question



1. Apple Music was built to compete with Spotify with fundamentally the same model. Spotify was already in operation fo years.

2. Apple Arcade was built to compete with other gaming services. Epic and others such have been in operation for years.

The crux of the matter is in bold in my quote. Its not so much in Apple entering with competing products, or Spotify competing with Apple Music etc , but in Apple using their device market share as leverage over existing businesses.

Don't recall Spotify or Epic coming up so hard before that. This will happen more and more as time progresses ... the late one is Fitness. It started to compete with Netflix and others, eBook Stores and so on ... all using mainly their device market share as leverage. Not only that but also baking in the OS purposely APIs out of reach of competitor to offer a better service.

There were companies following similar practices that were regulated in the US with the same justifications as Apple: https://en.wikipedia.org/wiki/United_States_v._Microsoft_Corp.

Microsoft Corp. v. Commission - Wikipedia

en.wikipedia.org

We have been here before. In effect, what Apple its doing is several order of magnitude more "aggressive".

In my opinion Apple is making a mistake and their followers aren't helping either. Because in trying to keep total control over the payment of third party digital services they will loose it if not more. Instead they could very well deal with it by themselves by stopping requiring the integration of in-app-purchase device in apps where digital services are concerned and offer alternative app hosting / review plans along with it. By doing this, the fundamental benefit of the App Store to customers would be untouched. They would still have total control over app curation, they could still assure quality ... so on and so forth. Third parties digital services would be free pursue the business models that best fit their business without the extra expense of things that they don't need or find benefit in using (In App Store Marketing, Universal Billing, Payment Processing, and so on).

The 50% market share instead of 80% might shield them in the US, but in the EU don't think it's the case.

Cheers.

I don't agree with the above, although you have a very cogent discussion...whether it's seen like that in the US (and other locations) is up for grabs. Additionally, SiriusXM is also a competitor in the same space, although they are not limited to the internet as the sole vehicle. To me the satellite transmission is a great feature as I don't have to rely on streaming music to my cars speakers through my phone.

 

[jlc1978]

But wait a minute … I thought App Store sold products and services.

They do, and they have a number of different customer bases for those products and services.

But now what you are saying is that they sell access to people that bought the devices in good faith.

People who also bought the device knowing upfront how the app store worked. It's not like Apple all of a sudden decided to change how apps are delivered. There is no bad faith on their part wrt the purchasers of the devices.

It's no different then say, El Corte Inglés, where companies want to be on the shelf since they have a large customer base.

There is =, of course, a danger in becoming too reliant on any one company for product sales, just ask companies who sell to Walmart and soon find that a significant percentage of their sales come from Walmart and now must meet Walmart's demands or risk losing a significant percentage of their revenue.

It kind of looks like those businesses that sell tickets for people to go to the circus totally unaware that after all there is another show going where their are the main attraction. You know, businesses like Facebook.

Except Apple, unlike Facebook, isn't using their data as the attraction, a better circus analogy would be a popcorn vendor decided the circus' customers would be a good market and the circus allowed them to sell and took a cut of the revenue. The popcorn vendor knows nothing about the buyer other than they bought their product.

Here is what Tim Cook said while critiquing Facebook:

“The end result of all of this is that you are no longer the customer," said Cook. "You are the product."
"We believe that ethical technology is technology that works for you" said Cook.

Delivering apps while not letting third parties access your information is different than collecting all that data and tehn using it to get ads from companies based on your data.

Has an avid Apple devices user and some services of theirs, I’m glad you aren’t heading the company.

It seems, in you opinion, Apple should not be able to make a profit off of access to its customer base and let developers access it for free while making money of of that very base, a move that would wipe out a significant percentage of Apple's profit.

In that regard, I guess it's good you aren't Apple's CEO either.

I totally trust that Apple will do the right thing for devices users, their customers, on this matter. There are other ways to build a successful business, I totally agree with Tim Cook on that one. Hopefully they will come with more creative and just policies for their App Store that don’ t use their customers as a product.

Again, there is a big difference between collecting data on customers and using it to sell ads and creating a very lucrative market and profiting from it.

Think of it this way:

What if a company made a product, a store stocked it but the label said "If you pay via this method you get for 390% cheaper" , the company gets 100% of the sale, the store gets 0% and you get the product? A reasonable deal?

Yo might argue digital is somehow different but the basic concept is the same in either real or digital products and services.

 

[Nuno Lopes]

But Apple does the same thing in their apps and across their apps … to present users targets Ads.

Goto the Apple website … there is a page where they explain that. Everyone that is using FB knows that the company tracks them to give them targeted Ads also. How come you don’t know that Apple is doing the same thing … albeit probably at least theoretically assures more anonymity?

No, I think its unethical to say the least companies to hold their customers ransom without their knowledge or consent. Even more so when indeed unknowingly pay thousands of dollars for the ticket (devices). Effectively a 30% markup over App hosting and distribution is what is doing. FB in that respect is even more transparent go figure.

The App Store is NOT your regular Store as you paint it to be. Is the only place people can go to get Apps and App updates on their smartphone. One in two Americans, give or take. That is what it really is from a device user point of view … how else can users installs apps … do you need a picture to understand this? Given this saying is a lead generator for third party digital services … give us a break!!!

So many sophisms are being used that is hard to keep track.

The music, videos and everything else they get from the Apps, not the App Store … yet the App Store charges them for that too … hidden in the app subscription services price. On the other side Apple is using the device users, their customers to justify the markup to the third parties digital services … not only to do that but to condition their business models … case in case take a look at how Apple conditioned xCloud. How does that favor the people that bought them the devices?

In any and all these approaches the Customer is being winged as the product in the Apple vs third party digital services relationship. There are other ways to be successful in business as Tim Cook says. I hope lives by its word and some day soon Apple changes the policy.

Their business has grown tremendously not because of this. But the amazing work they are doing with their devices and software … and are being rewarded for that by me … and anyone that buys them devices, license their software and subscribe to their digital services.

 

[AnonMac50]

I was trying to think of when the scenario you describe has happened to me. I usually use Plex and I do remember occasionally the music app starting, like when I stop for gas and bring phone in gas station. When I come out there have been times where music app starts up as opposed to Plex but not every time. Why do you have anything in music if you use Spotify??? I would suggest removing any music you have loaded into music app. then there wont be anything for it to switch to. Hopefully that will solve that issue for you.

Thanks. I tried that. Actually I don't have any music I specifically put in to the Music app, it's all from the iTunes Store. I tried turning off the setting to show my iTunes Store music but then I get the same issue as not having the Music app installed on the phone (my car doesn't read the phone at all, be it wired or wireless), so I had to reenable those songs in my phone once more just to be able to use Spotify.

 

[UBS28]

Well record companies also had to pay music stores to have their cd's displayed... A-brand cornflakes is also payed for by the manufacturer to be displayed on the shelf next to the Walmart cornflakes.

You can subscribe to Spotify through their website.

But Spotify is not allowed by Apple to tell that people that they need to go the website and subscribe from there?

 

[UBS28]

This is easily fixed by Apple: allow Spotify to link to their website for payment.
I’d like apple to explain how that would be a bad thing.

You know why. They put up these barrier on purpose to protect Apple Music.

Anyway, I really don't like to see a fine, because in the end, the Apple consumers are going to pay for it indirectly.

I'm pretty sure if Apple was an EU company, Apple would not get fined.

 

[deevey]

But Spotify is not allowed by Apple to tell that people that they need to go the website and subscribe from there?

Netflix work around that just fine by ditching IAP's and doing good advertising and marketing campaigns.