Tech behemoth Apple was hit with its first-ever antitrust fine by the European Union on Monday, totaling more than 1.8 billion euros ($1.95 billion), for prohibiting Spotify and other music streaming services from alerting customers about payment choices available outside of the App Store, according to Reuters.
Apple’s activities were found to be creating unfair market conditions by the European Commission, which was spurred by a complaint from Spotify in 2019. The ruling was based on the idea that withholding such information is against EU antitrust regulations.
The EU competition enforcer stated that Apple’s actions caused harm that went beyond financial gain in order to justify the hefty penalties.
“For a decade, Apple abused its dominant position in the market for the distribution of music streaming apps through the App Store,” stated EU antitrust director Margrethe Vestager.
She emphasized that developers were prevented by Apple’s constraints from educating customers about other affordable music services available outside of the Apple ecosystem.
Apple reacted negatively to the ruling and promised to contest it in court. The company contended that the Commission ignored the vibrant, competitive structure of the market and was unable to find solid proof of harm to consumers.
Apple’s main argument centered on Spotify, a Swedish corporation that does not pay Apple any commission, being seen as the decision’s benefit.
With effect from March 7, the EU’s order to Apple to remove restrictions from the App Store is in line with the provisions of the impending Digital Markets Act (DMA). Even though the payment is unprecedented, it only makes up around 25% of the fines the EU has levied on Google over the last ten years.
In an effort to resolve a separate EU antitrust inquiry, Apple is also recommending to rivals that their tap-and-go mobile payment systems be made open to competitors. This change is anticipated to be approved without incurring further penalties.
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