Five people who have direct knowledge of this long-running investigation claim that Brussels will impose the first fine ever on Apple for allegedly violating EU law regarding access to its streaming music services.
The fine is estimated to be in the range of €500mn, and will likely be announced at the beginning of next month. It is the result of an antitrust investigation by the European Commission into whether Apple used its platform to favor its services over competitors.
This probe investigates whether Apple has blocked apps from letting iPhone users know about cheaper alternatives for music subscriptions available outside of the App Store. The probe was launched in 2019 after Spotify, a music streaming app, filed a formal complaint with regulators.
People familiar with the matter say that the Commission will declare Apple’s actions illegal and in violation of the rules of the EU which enforces competition on the single market. Apple will be banned from blocking users who are not in its App Store from switching to other music services.
The people claimed that Brussels would accuse Apple for abusing its position of power and imposing anticompetitive trade practices on competitors. They added that the EU will call Apple’s terms “unfair business conditions”.
This is one of the largest financial penalties imposed by the EU against big tech companies. The court is contesting a series of fines levied against Google over a period of several years, totaling about €8bn.
Apple was never fined by Brussels for antitrust violations, but in France in 2020 the company received a €1.1bn fine for an alleged anticompetitive behavior. After an appeal, the penalty was reduced to €372mn.
The EU’s actions against Apple will reignite a war between Brussels, and Big Tech. This is at a moment when companies must demonstrate how they comply with new landmark rules that are aimed at allowing competition to flourish and small tech rivals thrive.
Digital Markets Act requires that companies such as Apple, Amazon, and Google comply fully with the rules by early next week.
This act will require these tech giants comply with stricter rules, and force them to share information on their services with rivals.
Brussels insists that change takes time, but there are still concerns about the speed of competition.
In 2021, Brussels officially charged Apple with in the anti-competitive investigation. Last year, the commission narrowed the scope and abandoned an accusation of forcing developers to use Apple’s in-app payments system.
Apple announced last month changes to its iOS mobile app, App Store, and Safari browser to appease Brussels. The EU had long resisted such measures. Spotify, however, said that Apple’s compliance at the time was a complete and total farce.
Apple replied by saying “the changes we are sharing for iOS apps in the European Union gives developers choice — with a new option to distribute iOS applications and process payments”.
In another antitrust case, Brussels consults with Apple’s competitors about the concessions made by the tech giant to assuage ‘s fears that Apple Pay is blocking financial groups.
People with knowledge of this situation say that the timing of the Commission’s announcement is not yet set, but it won’t change the direction of antitrust investigation.
Apple, which has the right to appeal the ruling to EU courts, refused to comment. However, it pointed to an earlier statement in which it stated that it was “pleased with the Commission’s narrowing of the charges” and promised to address the concerns while promoting the competition.
The statement continued: “The App Store helped Spotify become Europe’s top music streaming service and we hope that the European Commission will stop its pursuit of an unfounded complaint.”
The Commission, the EU’s executive body, declined to comment.
Post Disclaimer
The following content has been published by Stockmark.IT. All information utilised in the creation of this communication has been gathered from publicly available sources that we consider reliable. Nevertheless, we cannot guarantee the accuracy or completeness of this communication.
This communication is intended solely for informational purposes and should not be construed as an offer, recommendation, solicitation, inducement, or invitation by or on behalf of the Company or any affiliates to engage in any investment activities. The opinions and views expressed by the authors are their own and do not necessarily reflect those of the Company, its affiliates, or any other third party.
The services and products mentioned in this communication may not be suitable for all recipients, by continuing to read this website and its content you agree to the terms of this disclaimer.