Spotify Claims Apple Rejected App Update to Force It to Use Tech Giant’s Billing System

Spotify
Courtesy of Spotify

A prickly new front just opened up in the war over streaming music: Spotify is complaining that Apple rejected the latest update to Spotify’s app, alleging that the tech behemoth is trying to force the company to use Apple’s own billing system to sell subscriptions.

In the wake of the Apple rejection of the iOS update, Spotify has reached out to members of Congress to share its position on the situation and a letter the company sent to Apple’s legal department earlier this week about the standoff, hoping that lawmakers will step in to level the playing field, Variety has confirmed. Recode first reported the development.

Apple reps did not respond to requests for comment. Spotify declined to comment.

Spotify has previously argued that Apple abuses its market power to put rivals at a disadvantage. The key issue in this dispute: Apple requires app publishers like Spotify to pay 30% of the fees they charge for subscriptions purchased through Apple directly. That means Spotify has charged $13 per month for its standard service if it’s purchased through Apple, whereas it’s $10 monthly if you sign up on Spotify’s website (and where the company is currently running a promo through the end of June offering three months of service for 99 cents).

Right now, Spotify’s iOS app does not allow users to subscribe through Apple’s billing system, and according to Spotify that’s why Apple blocked its latest update. Spotify’s app in Apple’s App Store was last updated May 26.

Related

Streaming Music

Streaming Biggest U.S. Music Industry Revenue Source in 2015

The implication is that Apple is trying to thwart Spotify’s traction in music subscriptions, in order to drive users to Apple Music (which costs $9.99 per month for an individual membership). Spotify this month said it surpassed 100 million monthly active users, with more than 30 million paying subs. Apple, at its developers conference this month, said Apple Music has topped 15 million paying users since launching a year ago.

In its fight with Apple, Sweden-based Spotify may have friends among U.S. lawmakers. As noted by Recode, in a speech Wednesday at a conference in Washington, D.C., Sen. Elizabeth Warren (D-Mass.) argued that Apple, along with Google and Amazon, are virtual monopolies that are hurting smaller competitors.

“Google, Apple and Amazon provide platforms that lots of other companies depend on for survival,” Warren said, but that in many cases they compete with those same smaller players “so that the platform can become a tool to snuff out competition.”

Warren even singled out Apple Music, saying that the company has made it “difficult” for Spotify and others to compete with Apple Music.

Filed Under:

Want to read more articles like this one? SUBSCRIBE TO VARIETY TODAY.
Post A Comment 0

Marketplace

    Leave a Reply

    No Comments

    Comments are moderated. They may be edited for clarity and reprinting in whole or in part in Variety publications.

    Fill in your details below or click an icon to log in:

    WordPress.com Logo

    You are commenting using your WordPress.com account. Log Out / Change )

    Twitter picture

    You are commenting using your Twitter account. Log Out / Change )

    Facebook photo

    You are commenting using your Facebook account. Log Out / Change )

    Google+ photo

    You are commenting using your Google+ account. Log Out / Change )

    Connecting to %s

    More Digital News from Variety

    Loading