This is part of what the EU had to say: "Today's decision concludes that Apple's anti-steering provisions amount to unfair trading conditions, in breach of Article 102(a) of the Treaty on the Functioning of the European Union (‘TFEU'). These anti-steering provisions are neither necessary nor proportionate for the protection of Apple's commercial interests in relation to the App Store on Apple's smart mobile devices and negatively affect the interests of iOS users, who cannot make informed and effective decisions on where and how to purchase music streaming subscriptions for use on their device.
Nutshell: EU is arguing that smartphone users only have access to information that's inside the App Store and apps. They're totally ignoring the fact that an iPhone also has access to the internet, social media, phone calls/texts, email and push notifications. Apple doesn't control the content in any of those. The idea that consumers in 2024 have no idea where to get information without the app telling them is TOTALLY BONKERS.
Again, the American contributors, believing the 0-meridian runs through Cupertino have a hard time understanding this fine.
It's not that the iPhone does not allow users to surf on the net to find the information on Spotify's site.
It's that the App Store is designed in such a way that the information about one product is harder to get than the information about another product.
And, guess what, it's not Apple Music's info that is harder to get.
Is that clear enough?
To be really crystal: as an IPhone buyer, I bought an IPhone: not an Apple products push engine.
The end result of this is that the EU is becoming even less competitive; more regulation in lieu of increased investment in innovation.
Perhaps that $2B will be used to mitigate some of the issues plaguing farmers, now rioting against both EU regulations, cost of operation, and competition from other countries where EU farmer inefficiencies are pronounced.
While that is going on, the EU is a dangerous crossroads with its auto manufacturing, as Chinese imports are poised to expand into the EU.
The EU like the USA can keep them out for a while but the Chinese will be everywhere else in the world selling cheaper electric vehicles of all types smiling before Tesla and the German companies can do anything about it. (actually the Chinese are selling every type of electric/motorize vehicle that can crawl on the face of the earth already in all corners of the globe). The Chinese/East Asia will own the market long term.
The EU or USA won't win in tech or electric/motorize vehicles by Napoleon edicts.
This is part of what the EU had to say: "Today's decision concludes that Apple's anti-steering provisions amount to unfair trading conditions, in breach of Article 102(a) of the Treaty on the Functioning of the European Union (‘TFEU'). These anti-steering provisions are neither necessary nor proportionate for the protection of Apple's commercial interests in relation to the App Store on Apple's smart mobile devices and negatively affect the interests of iOS users, who cannot make informed and effective decisions on where and how to purchase music streaming subscriptions for use on their device.
Nutshell: EU is arguing that smartphone users only have access to information that's inside the App Store and apps. They're totally ignoring the fact that an iPhone also has access to the internet, social media, phone calls/texts, email and push notifications. Apple doesn't control the content in any of those. The idea that consumers in 2024 have no idea where to get information without the app telling them is TOTALLY BONKERS.
That’s not what the EU is arguing and largely why I copy/pasted part of their defence of the punishment.
Apple wilfully used anti competitive practices. Those practices went on for ten years and were brought to the attention of the authorities. An investigation was launched. The fine is the result.
Can you at least see why anti-steering is seen as harming competition?
It's irrelevant that Apple 'changed its ways' not too long ago.
What is relevant is that someone at Apple sat down and pushed that rule through in the first place.
Perhaps the EU should dig further to see if there was any red flag raised at the mere thought of it. That is the kind of thing the US DoJ would do.
Apple’s response is the 'bonkers' bit.
It’s literally what they were arguing. The eu wants to pretend that am people are literally unaware of the internet. They put forth this fantasy that if a competitor doesn’t have a sign next to its product in the store that points you to their store, then that is somehow terrible and deserving of billions in penalties. That’s the actual spirit of their statement. No getting around it.
So now they make up rules for apple, but you go to any store and don’t see it littered with signs or stickers with this practice.
The eu is nothing more than an extortion racket.
Unless, you know, they force Mercedes to put bmw signs in their dealerships to make it the same draconian policy for everyone.
The US should really should be targeting European companies that do significant business in the US and start finding (or making up) reasons to issue significant fines and other penalties. Every time the EU targets an American-based company, the US should do the same. Time to start putting some retaliatory pressure on the EU.
Our market is much too important to the US.
Our iPhones will work differently from the US iPhones.
We'll have more options and more freedom to choose.
"Today's decision concludes that Apple's anti-steering provisions amount to unfair trading conditions, in breach of Article 102(a) of the Treaty on the Functioning of the European Union (‘TFEU'). These anti-steering provisions are neither necessary nor proportionate for the protection of Apple's commercial interests in relation to the App Store on Apple's smart mobile devices and negatively affect the interests of iOS users, who cannot make informed and effective decisions on where and how to purchase music streaming subscriptions for use on their device.
Apple's conduct, which lasted for almost ten years, may have led many iOS users to pay significantly higher prices for music streaming subscriptions because of the high commission fee imposed by Apple on developers and passed on to consumers in the form of higher subscription prices for the same service on the Apple App Store.
... "
Apple makes no reference to its anti-competitive behaviour in its statement and instead tries to put the spotlight on Spotify, its European nature and music streaming.
I’m curious, does Spotify discount its service by the amount of Apple’s commission when a customer pays directly through Spotify’s website?
That's the only way an iPhone customer CAN pay. They don't offer in-app subscriptions.
"Today's decision concludes that Apple's anti-steering provisions amount to unfair trading conditions, in breach of Article 102(a) of the Treaty on the Functioning of the European Union (‘TFEU'). These anti-steering provisions are neither necessary nor proportionate for the protection of Apple's commercial interests in relation to the App Store on Apple's smart mobile devices and negatively affect the interests of iOS users, who cannot make informed and effective decisions on where and how to purchase music streaming subscriptions for use on their device.
Apple's conduct, which lasted for almost ten years, may have led many iOS users to pay significantly higher prices for music streaming subscriptions because of the high commission fee imposed by Apple on developers and passed on to consumers in the form of higher subscription prices for the same service on the Apple App Store.
... "
Apple makes no reference to its anti-competitive behaviour in its statement and instead tries to put the spotlight on Spotify, its European nature and music streaming.
I’m curious, does Spotify discount its service by the amount of Apple’s commission when a customer pays directly through Spotify’s website?
No. Apple pointed out that Spotify has always charged the same prices and never passed any savings on to consumers.
Spotify has 56% of the EU market. Next is YouTube and Amazon with Apple in 4th place at 11%.
So where’s the harm to Spotify? They’re the largest streamer in the world and completely dominate the EU. I’ve heard the idiotic argument that “Spotify could be even more successful if Apple didn’t put up roadblocks”. So…your argument is Spotify didn’t become an even bigger monopoly in music so Apple should pay up?
Same with consumers. Where’s the harm? Spotify hasn’t had in-App subscriptions since 2016. There was a brief period of overlap from 2015 to 2016 where Apple Music and Spotify competed unfairly, and if anything the fine should reflect that period of time only. And where does Vestager get off claiming this has been going on for 10 years when Apple Music has only been around 8 years?
Apple won the Irish tax case on appeal. This case will be easier to overturn as the EU can’t prove harm to…anyone.
Wasn't Spotify charging an extra $3 a month for Premium over the on-site price if subscribed via the App Store? Now, of course, you can't subscribe at all through the AppStore, only directly through Spotify.
BTW, the tax case is not over. In fact it's likely it will be retried, with several Judicial errors affecting the appeal ruling. You've forgotten that AppleInsider had an article about it back in November.
Only for a one year period from 2015-2016. I calculated this came out to about $70 million in the EU. So make Apple Pay $70 million and refund consumers. Or make them pay treble ($210 million).
No, let’s fine Apple almost $2 billion and keep the money ourselves instead of giving it to the people who were supposedly harmed.
The Irish tax case is over. A Hail Mary attempt to revive it doesn’t mean anything.
"Today's decision concludes that Apple's anti-steering provisions amount to unfair trading conditions, in breach of Article 102(a) of the Treaty on the Functioning of the European Union (‘TFEU'). These anti-steering provisions are neither necessary nor proportionate for the protection of Apple's commercial interests in relation to the App Store on Apple's smart mobile devices and negatively affect the interests of iOS users, who cannot make informed and effective decisions on where and how to purchase music streaming subscriptions for use on their device.
Apple's conduct, which lasted for almost ten years, may have led many iOS users to pay significantly higher prices for music streaming subscriptions because of the high commission fee imposed by Apple on developers and passed on to consumers in the form of higher subscription prices for the same service on the Apple App Store.
... "
Apple makes no reference to its anti-competitive behaviour in its statement and instead tries to put the spotlight on Spotify, its European nature and music streaming.
I’m curious, does Spotify discount its service by the amount of Apple’s commission when a customer pays directly through Spotify’s website?
No. Apple pointed out that Spotify has always charged the same prices and never passed any savings on to consumers.
Spotify has 56% of the EU market. Next is YouTube and Amazon with Apple in 4th place at 11%.
So where’s the harm to Spotify? They’re the largest streamer in the world and completely dominate the EU. I’ve heard the idiotic argument that “Spotify could be even more successful if Apple didn’t put up roadblocks”. So…your argument is Spotify didn’t become an even bigger monopoly in music so Apple should pay up?
Same with consumers. Where’s the harm? Spotify hasn’t had in-App subscriptions since 2016. There was a brief period of overlap from 2015 to 2016 where Apple Music and Spotify competed unfairly, and if anything the fine should reflect that period of time only. And where does Vestager get off claiming this has been going on for 10 years when Apple Music has only been around 8 years?
Apple won the Irish tax case on appeal. This case will be easier to overturn as the EU can’t prove harm to…anyone.
Wasn't Spotify charging an extra $3 a month for Premium over the on-site price if subscribed via the App Store? Now, of course, you can't subscribe at all through the AppStore, only directly through Spotify.
BTW, the tax case is not over. In fact it's likely it will be retried, with several Judicial errors affecting the appeal ruling. You've forgotten that AppleInsider had an article about it back in November.
Only for a one year period from 2015-2016. I calculated this came out to about $70 million in the EU. So make Apple Pay $70 million and refund consumers. Or make them pay treble ($210 million).
No, let’s fine Apple almost $2 billion and keep the money ourselves instead of giving it to the people who were supposedly harmed.
The Irish tax case is over. A Hail Mary attempt to revive it doesn’t mean anything.
You could still pay 15% to Apple and maintain your old Spotify Premium subscription through Apple, but last year that changed. You can't pay via Apple anymore, but I think up until that Apple was taking a 15% cut of the Spptify payments made via the App Store. Plese correct that if it's no accurate.
I hope these costs are directly passed along to purchasers of Apple products in Europe.
For decades, Apple prices in Europe are usually about 20% higher than in the US (That is taking Apple US price in USD, convert at market rates to Euro, add EU sales taxes ~20% ... you end up with a price that is still about 20% lower than the end user prices Apple charges in the EU). So yeah cost of doing business. The EU still needs a way to finance their tax gifts to farmers.
The US should really should be targeting European companies that do significant business in the US and start finding (or making up) reasons to issue significant fines and other penalties. Every time the EU targets an American-based company, the US should do the same. Time to start putting some retaliatory pressure on the EU.
Our market is much too important to the US.
Our iPhones will work differently from the US iPhones.
We'll have more options and more freedom to choose.
Unless you want to choose a product with better privacy and security, or with better integration of hardware and software.
"Today's decision concludes that Apple's anti-steering provisions amount to unfair trading conditions, in breach of Article 102(a) of the Treaty on the Functioning of the European Union (‘TFEU'). These anti-steering provisions are neither necessary nor proportionate for the protection of Apple's commercial interests in relation to the App Store on Apple's smart mobile devices and negatively affect the interests of iOS users, who cannot make informed and effective decisions on where and how to purchase music streaming subscriptions for use on their device.
Apple's conduct, which lasted for almost ten years, may have led many iOS users to pay significantly higher prices for music streaming subscriptions because of the high commission fee imposed by Apple on developers and passed on to consumers in the form of higher subscription prices for the same service on the Apple App Store.
... "
Apple makes no reference to its anti-competitive behaviour in its statement and instead tries to put the spotlight on Spotify, its European nature and music streaming.
That’s because it’s absurd for the company that holds more than half the market to accuse another company that has a much smaller market share of “anti-competitive behavior” in that market. It becomes doubly absurd when you consider that much of that market wouldn’t even exist without the mobile platform created by Apple and then copied by its competitors.
When Spotify launched in 2006, streaming music was limited primarily to stationary, plugged-in computers. There were mp3 players and iPods that made downloaded music portable, but Apple had to invent the iPhone, push phone companies into broadband, and then introduce the App Store for Spotify to become relevant. Samsung, Google and others followed, expanding Spotify’s opportunities for riding the broadband mobile platform wave.
Spotify then used that platform to disrupt the purchased digital music market, and Apple supplanted iTunes with Apple Music in response.
As with Epic, Spotify just wants a free ride. That’s what this is all about.
Honestly, when you add to this the fact that Spotify also notoriously pays artists significantly less for their content than Apple, they come off as pretty parasitic, when you think about it.
Marketshare has little to do with anti-competitive behaviour or the fines.
One of my old clients (plastics industry) received and invite to a meeting of the main industry players (worldwide players) in the field. I think the meeting took place in Germany.
Once there it quickly became clear that the agenda was an attempt at price fixing. My client quickly pulled out, not wanting anything to do with it.
The company proposing all this was from the US.
That same company (probably seeing the risks) reported the meeting to the EU and my client got a multi million euro fine - just for being there.
The US company escaped a fine as it was the whistleblower. Isn't that ironic!?
The fine stood. However the client did not hold a dominant (or even near dominant position in the industry).
Which part of anti-steering within the context of a multi billion dollar app store business was not anti-competitive?
So… by your logic, the eu perpetrated something really unfair and bad. So it should keep happening? Especially to an American company?
Bro. You’ve been at that line for a while. Time to go home and rest.
The laws exist in their current guise for a reason. There is no perfect law.
EU fines aren't reserved for foreign companies doing business in the EU.
I hope these costs are directly passed along to purchasers of Apple products in Europe.
For decades, Apple prices in Europe are usually about 20% higher than in the US (That is taking Apple US price in USD, convert at market rates to Euro, add EU sales taxes ~20% ... you end up with a price that is still about 20% lower than the end user prices Apple charges in the EU). So yeah cost of doing business. The EU still needs a way to finance their tax gifts to farmers.
Is that just Apple or any American company that sells products in Europe? I have heard while shopping at an AppleStore a U.K. citizen complaining about all products from the US are much much higher and not just Apple’s. They have mentioned that the reason is the local government has had tarrifs on foreign products to make their citizens buy local. Same reason why here in the US EU products are more expensive. Also because they don’t put a lot of artificial stuff in their consumable products.
Ridiculous... if Apple was so good at "steering" surely they would be better than the third or fourth music streamer in the EU. And whose pockets is this $2 billion going to end up in anyway? Surely not the artists music streamers have been ripping off since the beginning, and the artists are the ones who'd suffer the most from any alleged "steering".
Spotify built their business by barely paying artists more than the original Napster, and then they have the stones to complain about paying Apple's fees. I will never use Spotify, and will discourage all my friends from using it also.
The EU blaming Apple for not allowing ither stores to advertise in apple’s store… yeah, that’s such a horrible thing. I totally see target items with stickers telling customers to go to wal mart instead for cheaper… not.
This is criminal. The eu is basically inventing ways for apple to get in trouble these days. Perhaps they view apple as their own piggy bank.
Time to leave the eu. Enough is enough.
Utterly horrible and, as now shown, illegal according to the EU.
The world is not as black and white as you seem to imply. There is a lot of colour you are missing in your claim.
Like, for example, the fact that on iDevice platforms 'other stores' were not even allowed to exist.
If Apple wants to do business with the outside world on its platforms, then it will be subjected to the rules of the outside world where competition is to be encouraged, not eradicated.
And let's not forget that Apple is dependent on apps for its platforms.
I've always said it has had potential options. The biggest of those being asking the user to sign off (up front and prior to purchase) on giving up on alternative options and explicitly accepting that Apple will take a cut (commission, fee or whatever you want to call it) of every transaction the consumer makes. That, after all is what Apple wants: its part of the pie.
All in the name of security, privacy or however you want to name it. At least that's what many here claim.
After all, that's why so many people buy iPhones and iPads.
You'd think they'd be lining up to sign, although personally I think most would run to the hills at the thought of signing such an understanding.
"Today's decision concludes that Apple's anti-steering provisions amount to unfair trading conditions, in breach of Article 102(a) of the Treaty on the Functioning of the European Union (‘TFEU'). These anti-steering provisions are neither necessary nor proportionate for the protection of Apple's commercial interests in relation to the App Store on Apple's smart mobile devices and negatively affect the interests of iOS users, who cannot make informed and effective decisions on where and how to purchase music streaming subscriptions for use on their device.
Apple's conduct, which lasted for almost ten years, may have led many iOS users to pay significantly higher prices for music streaming subscriptions because of the high commission fee imposed by Apple on developers and passed on to consumers in the form of higher subscription prices for the same service on the Apple App Store.
... "
Apple makes no reference to its anti-competitive behaviour in its statement and instead tries to put the spotlight on Spotify, its European nature and music streaming.
I’m curious, does Spotify discount its service by the amount of Apple’s commission when a customer pays directly through Spotify’s website?
The US should really should be targeting European companies that do significant business in the US and start finding (or making up) reasons to issue significant fines and other penalties. Every time the EU targets an American-based company, the US should do the same. Time to start putting some retaliatory pressure on the EU.
Shouldn't you be reserving judgement for the outcome of the DoJ ruling before proposing retaliation?
If things turn dark for Apple in the US will you be demanding the US retaliate against itself?
It's interesting that Apple will do whatever the Chinese government wants without uttering a peep, but they whine kicking and screaming about any regulation whatsoever in the EU. I say this as an AAPL investor as well as a user, but Apple management really seems to have a problem reading the room sometimes. Anyone could see this was coming, but Apple seems to want to cling onto their precious App Store margins no matter what; it's as if they know the hardware revenue is going to slow down and they are scrambling to do anything to maintain revenue. In the long term, I think this is going to hurt Apple, as they could give up some the services margin in exchange for good will with developers and government regulated markets and be better off down the road. Right now they are just alienating a lot of people by digging their heels in, and they still don't have a modem of their own, and their software stack is a mess.
i wonder if the local sleuths like gurman, duo, and muenster can figure out how much revenue Apple gives up by abandoning streaming music in the EU. I saw some report of 7%, but that is likely for all Apple products. I wonder if it was more than $2B? Likely. Offer refunds to the claimed duped consumers, and then stop offering music in the EU.
I don’t I’ll not use Spotify at all! Actually I have iTunes and barely use the music. I love the freedom that I can scroll and pick and choose any app I want in Apple and not worry that it is full of spam, illegal activity and mostly safe. I see Spotify on there but I don’t like them they spam my emails trying to get me to sign up just for trying them out over a year ago and did not care. I downloaded prime music and I am happy with their service right out of the Apple App Store. EU sucks anyway! They still think we are colonies and they believe they are an empire. They want to control Africa, India and Asia. That won’t happen at all! America is free from the tyranny gov of Great Britain. Not they want to keep playing taxes 250 years later! Make them pay there share of nato or cut them off! Here see I have it on there and it is bull that I can’t find it when in the app. It’s 2nd on my app search for music after YouTube actually and 4th is Apples music lol
Release an iPhone in the EU that is significantly cutdown specifically for the EU market. Include no AppStore and do not allow European developers access to Apple APIs at all unless they go through Apple’s AppStore.
This way EU developers can’t get a free ride, Apple is providing a completely open phone in accord with EU rules, but Apple punishes the EU. Yes users lose out but these EU rules are in fact causing users to lose out anyway.
Either way, when the users realise they are getting a hobbled phone because of the EU they will turn on the EU.
For decades, Apple prices in Europe are usually about 20% higher than in the US (That is taking Apple US price in USD, convert at market rates to Euro, add EU sales taxes ~20% ... you end up with a price that is still about 20% lower than the end user prices Apple charges in the EU). So yeah cost of doing business. The EU still needs a way to finance their tax gifts to farmers.
Is that just Apple or any American company that sells products in Europe? I have heard while shopping at an AppleStore a U.K. citizen complaining about all products from the US are much much higher and not just Apple’s. They have mentioned that the reason is the local government has had tarrifs on foreign products to make their citizens buy local. Same reason why here in the US EU products are more expensive. Also because they don’t put a lot of artificial stuff in their consumable products.
In Germany the MBA M3 15" starts at €1333 excl. sales tax = $1448. In US the price is $1299. That is +11.5%, and there is no customs tariff in EU on laptops from US. It is 0%. Even the polishing cloth is €21 (23 USD) while in US it is $19 (+21% in EU). All without taxes. There is no cost of warranty or localization on a polishing cloth. This Apple charging European customers more.
Comments
The EU like the USA can keep them out for a while but the Chinese will be everywhere else in the world selling cheaper electric vehicles of all types smiling before Tesla and the German companies can do anything about it. (actually the Chinese are selling every type of electric/motorize vehicle that can crawl on the face of the earth already in all corners of the globe). The Chinese/East Asia will own the market long term.
The EU or USA won't win in tech or electric/motorize vehicles by Napoleon edicts.
Our market is much too important to the US.
No, let’s fine Apple almost $2 billion and keep the money ourselves instead of giving it to the people who were supposedly harmed.
The Irish tax case is over. A Hail Mary attempt to revive it doesn’t mean anything.
...and YES, there's a high probability the tax demand case will be retried, but you can look that up yourself, or wait a few more months and read the article concerning it being sent back to the appeals court. With 100% certainly it is not over.
https://appleinsider.com/articles/23/11/09/apples-14-billion-tax-trial-should-start-over-says-eu
(That is taking Apple US price in USD, convert at market rates to Euro, add EU sales taxes ~20% ... you end up with a price that is still about 20% lower than the end user prices Apple charges in the EU). So yeah cost of doing business. The EU still needs a way to finance their tax gifts to farmers.
EU fines aren't reserved for foreign companies doing business in the EU.
The world is not as black and white as you seem to imply. There is a lot of colour you are missing in your claim.
Like, for example, the fact that on iDevice platforms 'other stores' were not even allowed to exist.
If Apple wants to do business with the outside world on its platforms, then it will be subjected to the rules of the outside world where competition is to be encouraged, not eradicated.
And let's not forget that Apple is dependent on apps for its platforms.
I've always said it has had potential options. The biggest of those being asking the user to sign off (up front and prior to purchase) on giving up on alternative options and explicitly accepting that Apple will take a cut (commission, fee or whatever you want to call it) of every transaction the consumer makes. That, after all is what Apple wants: its part of the pie.
All in the name of security, privacy or however you want to name it. At least that's what many here claim.
After all, that's why so many people buy iPhones and iPads.
You'd think they'd be lining up to sign, although personally I think most would run to the hills at the thought of signing such an understanding.
The fine isn't only about Spotify.
If things turn dark for Apple in the US will you be demanding the US retaliate against itself?
Release an iPhone in the EU that is significantly cutdown specifically for the EU market. Include no AppStore and do not allow European developers access to Apple APIs at all unless they go through Apple’s AppStore.
This way EU developers can’t get a free ride, Apple is providing a completely open phone in accord with EU rules, but Apple punishes the EU. Yes users lose out but these EU rules are in fact causing users to lose out anyway.
Either way, when the users realise they are getting a hobbled phone because of the EU they will turn on the EU.