On Monday, the European Commission imposed a significant fine of 1.84 billion euros ($2 billion) on Apple for its practices that hindered competition within the music streaming sector through restrictive measures in its App Store.
This marks a first in the history of the iPhone maker, as it faces penalties for violating EU regulations.
The fine includes a basic amount of 40 million euros, with an additional 1.8 billion euros as a deterrent, showcasing the EU’s stringent stance against antitrust violations.
The commission had previously accused Apple, following a complaint by Spotify in 2019, of limiting competition by preventing Spotify and other services from directing users to alternative payment methods outside of the App Store.
This move was declared as fostering unfair trading conditions, a claim also supported by a decision from the Dutch antitrust agency against Apple in a similar context in 2021.
Apple’s response to the fine was one of criticism and a vow to appeal, highlighting the company’s perspective that the commission’s decision overlooked the lack of evidence regarding consumer harm and the dynamic competition within the market.
Apple emphasized that Spotify, the world’s largest music streaming app and a frequent collaborator with the European Commission during the investigation, stood to benefit most from this decision.
European Competition Commissioner Margarethe Vestager highlighted the negative impact of Apple’s policies on consumers, including higher prices due to the app developers’ commission fees being passed on to consumers.
She stressed that Apple’s “anti-steering rules” left many European users unaware of the full range of available options for music streaming.
Despite Apple’s criticism, Spotify welcomed the EU’s decision, though it acknowledged ongoing concerns with Apple’s practices beyond the music streaming industry.
Analysts like Ryan Reith from IDC suggested that while Apple is financially equipped to manage the fine, this event is part of a broader trend towards dismantling the restrictive ecosystem Apple has built.
The EU’s aggressive stance on antitrust issues is not new, with Alphabet’s Google previously fined a total of 8.25 billion euros in three separate cases.
The order for Apple to amend its App Store practices mirrors upcoming requirements under the Digital Markets Act (DMA), which Apple must adhere to.
Meanwhile, Apple is attempting to resolve another EU antitrust probe by proposing to open its mobile payment system to competitors, a move likely to be accepted by EU regulators without additional fines.