Spotify cutting off remaining customers paying through the App Store
If you still pay for Spotify through the App Store, you won't be able to for much longer. Spotify is about to cut you off.
Spotify (on the left) and Apple Music (on the right)
There was a window of opportunity for Spotify Premium customers to sign up directly through the App Store, between 2014 and 2016. Back then, the two companies were very vocal about their feelings regarding the digital storefront and its fees, with Spotify constantly declaring along the way that Apple should remove the 30% App Store tax altogether.
Spotify removed the ability for new customers subscribing to the service's Premium tier to do so through the App Store in 2016.
However, as reported by Variety, that option is on the way out, too.
Wednesday's report says Spotify is notifying customers who are still paying for their Premium subscription via Apple's billing that Spotify is no longer accepting that form of payment. Once the customer's most recent billing period ends, if they don't change their method of payment they will automatically switch over to Spotify's free, ad-supported tier.
The email goes on to say if customers want to retain their Premium subscription, they will "need to re-subscribe after your last billing period has ended and your account has been moved on to the Free account." Customers will need to choose one of the payment methods Spotify supports at this point to keep up their subscription.
This "war" between Apple and Spotify has been going on for years now. It has even gone as far as Spotify filing anti-competitive complaints in the European Union in 2019.
Spotify once said Apple One, Apple's bundle of subscriptions that include Apple Music, is a "threat to collective freedom."
The streamer also continues to bang the 30% App Store fee drum, omitting that it is it 15% for subscribers to a service for over a year.
For its part, Apple hasn't minced words, either. The company has said in years past that Spotify is a company that wants "all the benefits of a free app without being free," among other things.
Most recently, Apple says it has already changed its rules within the App Store and for developers enough to satisfy Spotify's complaint against the company in the EU. That includes marking some apps, like Spotify, as "reader" apps, which can link outside of the app for users to manage their account information or set up new accounts.
Interestingly, Spotify continues to argue that Apple is using its dominant position within the market to continue its "anti-competitive" behavior. Apple, of course, often points to the fact that Spotify remains the true dominant music streaming service in the market, with Apple Music sitting in second place.
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Similarly, Apple also didn't force companies to bend to their rules or just lose 53% of the mobile market. Apple came up with a smartphone and platform and let third party developers sell their software on this platform, provided they followed the rules Apple felt would make it successful - i.e. their software needed to go through Apple's review process and only be downloaded via the AppStore (because Apple believed its customers wanted security) and, if those apps sold any digital goods, they had to do so through Apple's payment mechanism and give up 30% of the price of the item (again, because Apple thought it would benefit users to only need to give their payment information to one company - Apple - rather than have it sent to every software maker who might mishandle it).
Spotify, Electronic Arts, and all the other whiners out there agreed to those terms when they first got onto the iPhone - because they knew it was a win-win situation for everybody. But then they got successful and greedy and suddenly they no longer want to pay up. They want to change the rules.
Individuals who want to force Apple to allow downloading of apps from anywhere on the web should simply buy an Android phone instead of destroying the good thing (security wise) that Apple has built.
Where’s the article that points out the Google Tax everyone on the planet pays through their ad monopoly, and how those profits (80% of Alphabet revenue) goes towards subsidizing an OS that still
sucks beyond belief. Where’s that article?
The music industry take the about 60% of subscription revenue allotted to the artists every month (by each of the streaming services) and split it among all the artists whose songs were streamed, based on what percentage their songs were streamed out of all the songs streamed by that service, that month. If a Taylor Swift mega hit album captured 5% of all the songs streamed, she will get 5% of the revenue allotted to the all artists that month. Regardless of the numbers of streams. (And she would also get paid a per stream royalty for songs where she is the songwriter.) No artists are paid on a per stream basis. That number is worked out after the artists receives their portion of the monthly allotted subscription revenue. The number is what the artist earned per stream not what Apple (or Spotify) paid per stream.
So if Apple and Spotify had exactly the same number of subscribers paying $9.99 a month, Apple would statistically be seen as "paying" the artists 3x more than Spotify, if Apple subscribers were streaming 3x less music than Spotify subscribers (per month). Even though both are paying the same 60% of subscription revenue to the artists.
That said, the main reason why Spotify is seen as "paying" artists 3x less (than Apple Music) is because of their free ad supported music streaming service. Streams from that service don't pay the artists nearly as much as streams made by a paying subscribers, but gets included in the total streams per month. That is also true of Google. The vast majority of music streams are done with Google free ad supported You Tube and the artists earns way less "per stream" based on ad revenue, than from subscription revenue. But both Spotify and Google generate much more revenue for the music industry, than what Apple Music generates. But Apple "pay per stream" numbers looks much better than nearly all the other music streaming services.
https://pudding.cool/2022/06/streaming/
Apple charges a commission only when a developer uses their iOS apps to make money from selling digital goods to iOS users. Those are the rules of the Apple App Store and Spotify knew this when they first developed their iOS app. A Mac uses Spotify internet website for payment. One can do the same with the browser on an iPhone and Apple will not receive a commission.
Maybe you should be pondering this. It seems to make logical sense to Spotify, to pay Google a commission when their premium subscribers pays with their Android app from the Google Play Store.
https://newsroom.spotify.com/2022-03-23/spotify-and-google-announce-user-choice-billing/
Spotify and Google struck a deal where Google will allow Spotify to list an alternative payment method on their Android app and Spotify would receive a discount on Google's 15/30% discount if the Android customer chooses to use it to pay. The actual discount agreed upon is not made public but other developers receives a 4% (off the 15/30%) discount for the same type of deal.
https://www.macrumors.com/2022/11/10/google-play-spotify-alternative-billing/
And remember, Spotify do not have to use the Google Play Store to get their app on to Android devices. With android, they can open their own app store or have it so that their customers can download their app and then side load it. But they still saw fit to praise Google for striking their deal, that still requires them to give Google a commission for payment made through their app. Spotify, like Sweeney (the CEO of Epic Games) knows that being in the Google Play Store have value that is worth paying a commission for. It's about the over 85% of Android users that would not consider side loading an app or getting it from a third party app store, no matter how much they might trust Spotify (or Epic Games) with their CC info.
So it really doesn't matter if Apple were to allow third party app stores or side loading, Spotify would still be bitching about giving Apple a commission to be in the Apple App Store, in order to have access to the iOS customers that would never consider using another app store or side loading an app or not using their iTunes account to pay. If anything, iOS users are more particular about safety, security and privacy, than Android users.
And BTW- It's not that Spotify can not be trusted with personal data or might download malware into a device, if Apple were to allow side loading or third party app stores. It's that consumers can be fooled into thinking they are installing an app from Spotify (or other trusted developers) that is the concern. No matter how small the chances that an iOS user would click on a scam email link to install a Spotify app offering them a 3 month free trial of Spotify Premium when it's actually installing malware or harvesting personal data, the chances are not going to be zero. Even if only a .05% chance, that would still be about 1M iOS users worldwide that got phished into it.
It certainly seems like Spotify is complaining that Apple is not willing to give it special treatment rather than making a valid point.
However, Apple's argument that it treats all developers the same is weakened by the treatment of Netflix and Roblox.