The EC is not the only regulator to take the view that app stores are a bottleneck
The EC intervened in a standoff between Apple and Spotify: The European Commission sent a ‘statement of objections’ to Apple on Friday, informing the company that it believes it distorted competition in the music streaming market. The case originated from a complaint Spotify made to the EC in 2019, arguing that Apple’s 30% commission fee forces Spotify to inflate the price of its premium membership well above the price of Apple Music. Spotify also said it could not avoid Apple’s payment system – otherwise Apple would impose a series of technical and experience-limiting restrictions on Spotify. At the time, Apple defended itself by saying that it was not blocking access to products and updates to their app, and accused Spotify of wanting the benefits of a free app without being free.
The EC almost fully backs Spotify’s argument: The in-depth investigation it opened in June 2020 found that the in-app purchase mechanism is mandatory, leaving music streaming apps with no alternative, and that Apple restricts developers’ ability to inform iPhone and iPad users of alternatives. Commissioner Vestager also noted that the fee applies to digital services, and not to physical services such as goods delivery or transport. This is a preliminary finding – Apple will now be able to respond to the statement and request an oral hearing. There is no deadline for the closing of the case.
Regulators are increasingly seeing app stores as a bottleneck: During the press conference, Vestager defined the app store as a ‘monopoly’. Recent cases in other countries suggest she is not the only one to see it that way. Two days before the EC’s statement, the Australian competition authority found that Apple and Google’s respective app stores have significant market power in the distribution of mobile apps in Australia, and proposed measures to empower consumers and app developers. In the US, a recent hearing of the Senate’s Judiciary Committee examined competition in app stores, and gave a clear indication that policymakers are viewing app stores as bottlenecks and could strengthen antitrust laws to further curb the power of Big Tech.
Source: https://ec.europa.eu/commission/presscorner/detail/en/ip_21_2061
