Thursday, Mar 02, 2023, 20:39 Apple services

EU Threatens Apple With Millions In Fines – Does Apple Music Violate European Anti-Trust Laws?

Apple's highly profitable services division, which has cashed in billions for the company, includes Apple Music – amongst other services. The European Commission has long since nourished the suspicion that Apple's manipulates its share of the handheld device market to promote its Music streaming app in an anticompetitive manner that impedes other competitors such as Spotify. The Swedish music streaming service previously filed a complaint in Brussels in 2019, resulting in competition law proceedings as of June 2020. With a formal statement, the European Commission has reiterated its preliminary concerns and demands an official response from Apple.

EU – Market Dominating Behavior From Streaming Apps
Thus far, the Brussels authority has held the opinion that Apple has abused its dominant position in the streaming service market. The latter is alleged to force third-party developers of apps that contain in-app purchases to process transactions made on its platform via Apple's own payment gateway. In addition, the Californian company allegedly limits developers' ability to inform iPad and iPhone users of alternative third-party music streaming services. According to the EU, this intentional restriction of third-parties is a clear violation of Article 102 of the Treaty on the Functioning of the European Union, according to a recent statement from the European Commission. In the current proceedings, the Commission will primarily focus on its interpretation of Apple's restrictions for app developers as unlawful and in violation of Article 102. The first accusation will not be pursued further, although the EU has yet to mention any reason for its inaction in this area.



Competition Authorities – Apple Penalizes iPhone & iPad Users
Apple's alleged, intentional restriction of the natural distribution of information concerning alternative streaming services on its app-distribution platform is "neither necessary nor proportionate" to or for the App Store's operation, according to the European Commission. Additionally, this action is contrary to the interests of third-party developers because it allows Apple to effectively limit users' selection of music streaming services to its own apps for iPhone and iPad, per the statement. The second assertion is that customers end up paying more on average in the end due to lacking knowledge of the alternatives. The Brussels authority has sent Apple a formal summary of the complaints and allegations. Now, the company has the chance to respond to the matter. Should the European Commission decide that there's enough proof of a breach of the EU's competition law, then it's possible that Apple could receive a fine totaling up to 10% of its yearly sales.

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