Berlin. Spotify Technology SA’s Chief Executive Officer Daniel Ek said his music-streaming service has suffered “a big business impact” from alleged restrictions by Apple Inc that sparked this week’s complaint to European Union antitrust cops.
Spotify wants the EU to investigate Apple’s App Store rules that take a 30 per cent cut of subscriptions and set a range of restrictions that frustrate customers. The music streaming service said the iPhone maker became more hostile after it launched its own Apple Music product, pricing it below Spotify’s monthly fee.
“Definitely one of our top customer complaints is, ‘Hey, why doesn’t this work on my Apple TV? Why doesn’t this work on my Apple Watch? Or my Siri system?’” Ek said in an interview in Berlin. This “leads us to believe it has a big business impact”.
Spotify’s claims, while Europe-based, come just days after US presidential candidate Elizabeth Warren said she would move to break up Apple for reasons that resonate with Spotify’s complaint. The EU’s antitrust commissioner vowed to take “seriously” Spotify’s allegations. Margrethe Vestager told Bloomberg TV earlier Thursday that her team would start looking at the complaint.
Vestager has a history of taking on tech giants, including Apple. In August 2016 she ordered Ireland to recoup a record 13 billion euros ($14.7 billion) in unpaid taxes plus interest from the company, saying it gained from an unfair fiscal arrangement with the nation.
“You have a specific Apple product, Apple Music, who is a direct competitor to Spotify and their services,” Vestager said. “This is of course such a dual market situation that we take very seriously, if you’re both the host and the competitor, well then how do you behave when you yourself has gained some status in the market?”
“It takes quite an effort for people to post a complaint, it’s not something you write on the back of an envelope. It takes much more data, much more investment to do that,” Vestager said in an interview with Bloomberg TV’s Matthew Miller in Berlin. “What we’ll make of it, that of course remains to be seen.”
“It’s difficult to put a precise” figure on how Apple’s actions affected Spotify’s sales or potential growth, said Ek, who is calling for regulators to lift internet platform’s ban on apps touting discounts. “If we had been able to speak to our customers freely, we could have told them about the great offers we have.”
Ek said he’s got support from “lots and lots of companies that have messaged me and told me that this is totally the right thing” after Spotify filed the complaint earlier this week. “We have not heard from Apple,” he said.
Apple representatives didn’t immediately respond to requests for comment on the complaint.
There is no “real choice” to selling on Apple’s App Store on Apple’s terms, Ek said. “There are billions of smartphones around the world. This is the predominant way that consumers access the internet today,” he said. “The alternative isn’t to allow users to go to a website. Consumers expect an app.”