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Report: Spotify Goes After Apple Over App Store Policies

It claims Apple's rejection of an update to its iOS app is hurting its business model.

By Tom Brant
June 30, 2016
Spotify vs Apple Music

Spotify expressed frustration with the App Store approval process this week after Apple reportedly rejected an update to the streaming music service's iOS app, according to Recode.

The update concerned Spotify's billing system for its Premium service, with Apple demanding that Spotify use Apple's own billing service—through which it takes a cut of all sales—for subscription payments, Recode reported.

The rejection reportedly prompted Spotify to send a letter to Apple's general counsel, signaling possible legal action over Apple's tight control of its App Store ecosystem. Recode said it obtained a copy of the letter, sent on June 26, which argued that Apple's rejection is the latest in a string of actions that could constitute a violation of American and European antitrust laws.

"It continues a troubling pattern of behavior by Apple to exclude and diminish the competitiveness of Spotify on iOS and as a rival to Apple Music, particularly when seen against the backdrop of Apple's previous anticompetitive conduct aimed at Spotify," the letter said, according to Recode. "We cannot stand by as Apple uses the App Store approval process as a weapon to harm competitors."

Neither company immediately responded to a request for comment.

Since 2011, Apple has taken a 30 percent cut of all App Store purchases, so if you download the Spotify app and subscribe through the app, Apple gets 30 percent of your monthly payment. As such, subscribing through the Spotify app costs $12.99 per month rather than $9.99 per month. To avoid the higher price, Spotify recommends that iPhone owners sign up for Spotify Premium on its website and then download the iOS app and sign in with their credentials.

This policy is why Amazon fans cannot purchase ebooks on the Amazon iOS app; Amazon doesn't want Apple getting 30 percent of its ebook profits. Users must instead buy ebooks on Amazon's website and then sync via the app.

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Spotify, which earlier this month said its monthly active user base had reached 100 million, faces competition from Apple's own streaming music service, which launched a year ago. Both offer $10-a-month premium plans that include unlimited, ad-free streaming; Spotify also has a free, ad-supported version.

With around 13 million subscribers to Spotify's 30 million paying members, Apple continues to play second fiddle to Spotify, though Apple is working to boost its subscription base. With iOS 10, Apple Music ($10.99 Per Month at Apple Music) will get a user interface overhaul, which Cupertino previewed at WWDC a few weeks ago.

The company is also in talks with Jay-Z's Tidal about a potential acquisition, the Wall Street Journal reported today, citing people familiar with the matter. Tidal launched in 2015 and its base subscription, which includes ads, costs $9.99 per month. It announced in March that it has 3 million paying subscribers.

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About Tom Brant

Deputy Managing Editor

I’m the deputy managing editor of the hardware team at PCMag.com. Reading this during the day? Then you've caught me testing gear and editing reviews of laptops, desktop PCs, and tons of other personal tech. (Reading this at night? Then I’m probably dreaming about all those cool products.) I’ve covered the consumer tech world as an editor, reporter, and analyst since 2015.

I’ve evaluated the performance, value, and features of hundreds of personal tech devices and services, from laptops to Wi-Fi hotspots and everything in between. I’ve also covered the launches of dozens of groundbreaking technologies, from hyperloop test tracks in the desert to the latest silicon from Apple and Intel.

I've appeared on CBS News, in USA Today, and at many other outlets to offer analysis on breaking technology news.

Before I joined the tech-journalism ranks, I wrote on topics as diverse as Borneo's rain forests, Middle Eastern airlines, and Big Data's role in presidential elections. A graduate of Middlebury College, I also have a master's degree in journalism and French Studies from New York University.

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