Updated Mar 4, 2024 - Technology

European Commission hits Apple with $2B antitrust fine after Spotify complaint

Apple logo

The Apple Inc. logo in Milan, Italy. Photo: Emanuele Cremaschi/Getty Images

The European Commission fined Apple $2 billion on Monday for violating antitrust rules with its handling of music streaming apps.

Why it matters: It's the fiercest antitrust enforcement against Apple for its dominance in the company's history, and it could motivate U.S. regulators to take a deeper look at the tech giant.

Driving the news: The tech giant abused its dominance in music streaming by suppressing competition from music streaming rivals by preventing app developers from informing iOS users "alternative and cheaper music subscription services," the commission said in a press release.

  • Apple said the European Commission's decision was made despite failing "to uncover any credible evidence of consumer harm, and ignores the realities of a market that is thriving, competitive, and growing fast."
  • The tech giant said it planned to appeal the determination.

The big picture: The ruling is a huge win for Apple rival Spotify, which has pushed aggressively to get regulatory officials to pay attention to Apple's practices.

  • In a statement, Spotify said the ruling, "marks an important moment in the fight for a more open internet for consumers."
  • "Apple has routinely defied laws and court decisions in other markets. So we're looking forward to the next steps that will hopefully clearly and conclusively address Apple's long-standing unfair practices," it said.
  • Meanwhile, Apple blamed Sweden-based Spotify, for lobbying the Commission, noting the firm has met with the Commission "more than 65 times during this investigation."
  • In its own statement, it claimed "a large part" of Spotify's success was due to being available for free in Apple's app store.

How we got here: The investigation that led to the fine stems from a 2020 complaint that Spotify lodged against Apple.

  • Apple's App Store rules require apps to pay Apple a 30% commission for consumer subscriptions that are bought through the app store.
  • In recent years, Spotify and other tech giants have also complained that Apple has undercut their sales by leveraging unfair business practices, such as restricting marketing emails.

State of play: The EU has been locked in two decades of antitrust battles with mostly American tech companies, including an order that Apple pay $14 billion in taxes, which is the subject of a years-long court battle.

  • The Commission has already fined Google billions in three separate anti-competition fines.
  • Beginning later this week, Apple will need to comply with the EU's new Digital Markets Act.
  • The rules are designed to break up their app store dominance, giving Apple's rivals new opportunities to lodge complaints about their actions.

What to watch: The U.S. Justice Department is in the late stages of an antitrust investigation into Apple, per The New York Times.

  • The DOJ is focused on how Apple leverages its dominance to suppress competition and make it harder for users to switch services.

Editor's note: This story was updated with a statement from Apple, Spotify and additional details and context.

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