Breaking News
0

Exclusive: Antitrust probers in Congress ask Spotify to detail alleged Apple abuses - sources

Stock MarketsOct 05, 2019 01:43PM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 

By Diane Bartz and Stephen Nellis

(Reuters) - U.S. lawmakers have requested information from Apple (NASDAQ:AAPL) critic Spotify (NYSE:SPOT) as part of an antitrust probe, according to two sources briefed on the investigation into allegations the iPhone maker engages in anti-competitive behavior to support its own apps.

The U.S. House of Representatives Judiciary Committee reached out to the music streaming service with broad requests for information, according to one source, who added the request to the company was narrowed in follow up telephone calls.

Spotify Technology SA filed an antitrust complaint against Apple in the European Union in March, but the contact with the committee marks its first known participation in congressional inquiries into the iPhone maker, whose Apple Music streaming service is Spotify's biggest rival.

Spotify and other developers have alleged that Apple engages in anticompetitive behavior by imposing rules that hamper distribution via its App Store, the only way for third-party developers to reach more than 900 million iPhone users.

At the same time, Apple sometimes copies the features of their apps for its own offerings, developers have said. Multiple apps in the App Store offered female cycle tracking before Apple added the same feature to its own health tracking app this fall, for example.

Apple has said it acts in the best interests of its users and treats all developers equally. It has denied Spotify's claims and says its streaming music rival is seeking to pay it nothing and play by a different set of rules than the millions of other apps on its App Store.

Spotify has been pressing for antitrust action against Apple for several years.

Its representatives have met with Justice Department officials, as well as members of the FTC's Technology Task Force, a group of some 17 attorneys that was set up in February to focus on online platforms and other Internet competition issues, according to one source.

App developers also complain that Apple's Siri, which responds to verbal commands and can control Apple's own apps, has long had limited functionality with the vast majority of non-Apple apps, including Spotify.

Apple announced an update to its software in June that would allow Siri to access Spotify and other music services.

Beyond Spotify, the congressional probe has tapped many companies for details on the four big tech firms.

In addition to the Judiciary Committee probe, the big tech companies face a plethora of other antitrust investigations.

The Justice Department is probing Alphabet's Google (NASDAQ:GOOGL), Facebook (NASDAQ:FB) and Apple while the Federal Trade Commission is investigating Facebook and Amazon.com (NASDAQ:AMZN). Groups of state attorneys general have also been formed to probe Google and Facebook.

Spotify has complained also about the 30 percent fee that Apple charges outside app developers who sell so-called digital goods such as music or e-books on the App Store, using Apple's in-app billing system. Apple bars app makers for collecting payment any other way on the App Store or showing users links or buttons to other ways to pay.

At one point, Apple told Spotify to stop sending emails to users who had just signed up for a free version of its streaming music prompting them to upgrade to the paid service, Spotify has said. Apple has said those emails were a workaround strategy to solicit payments outside its App Store system, violating the spirit of rules that all other app makers must follow.

Spotify has said the shifting rules, and Apple's threats to block routine app updates, have made it difficult to compete with Apple's own music service on a level playing field.

Asked for comment, Apple referred to its previous responses, published in March, to Spotify's claims. The company says it enforces its App Store rules evenly among all developers and that more than eight out of every 10 apps are free and pay nothing to Apple. Apple has said Spotify pays nothing for users of its free service or for paid Spotify members who signed up outside the App Store.

Apple has said Spotify pays a revenue share on about half a percent of its 108 million premium users, paying 15% fees on roughly 680,000 customers that Spotify acquired between 2014 and 2016 when it used Apple's payment systems.

"Even now, only a tiny fraction of their subscriptions fall under Apple’s revenue-sharing model. Spotify is asking for that number to be zero," Apple said in response to Spotify's claims it published in March.

Exclusive: Antitrust probers in Congress ask Spotify to detail alleged Apple abuses - sources
 

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind: 

  • Enrich the conversation
  • Stay focused and on track. Only post material that’s relevant to the topic being discussed.
  • Be respectful. Even negative opinions can be framed positively and diplomatically.
  •  Use standard writing style. Include punctuation and upper and lower cases.
  • NOTE: Spam and/or promotional messages and links within a comment will be removed
  • Avoid profanity, slander or personal attacks directed at an author or another user.
  • Don’t Monopolize the Conversation. We appreciate passion and conviction, but we also believe strongly in giving everyone a chance to air their thoughts. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
or
Sign up with Email