In 2020 regulators in the EU, the United States, and the UK began probing Apple’s App Store over complaints of anti-competitive policies and practices. Now, when the antitrust cases are about to commence, an expert Florian Mueller at the Foss Patents believes that “the first week of March 2021 may very well be judged by history as the end of the beginning”, for Apple’s mobile digital market place.
In 2019 Spotify, a Swedish music streaming service filed a complaint in the European Commission accusing Apple of deliberately putting its app at a disadvantage to promote its own music player, Apple Music by making it the default music player on iOS devices. The music streaming company also complained against the App Store’s 30% commission rate for all in-purchases. In 2020, Epic Games, developer of the popular Fortnite game, had a very public falling out with the iPhone maker, after the developer pushed a direct payment update on the gaming app. Wanted to get rid of the 30% commission rate as well, the developer has filed lawsuits against Apple in the United States, the UK, and Australia.
To put all of this in perspective, a few days ago, Reuters reported that the EU commission had almost finalized its charge sheet against the Cupertino tech giant on Spotify’s complaint and the document will be delivered to the company by end of summer. Therefore, Mueller is of the opinion that the iPhone maker’s grip on the App Store is in jeopardy.
Apple’s App Store antitrust hearings in the United States, UK, and EU might change the apps distribution system forever
Mueller writes since Apple Music is Spotify’s direct competitor, that makes Spotify’s position against the Cupertino tech giant stronger.
For a long time I was somewhat skeptical of whether Spotify’s complaint was just going to lead to a “Lex Spotify” or help the developer community at large. Having researched the app store antitrust situation in greater detail since last summer, and considering that Epic–which doesn’t specifically complain about direct competition from Apple, while Spotify is concerned about Apple Music–has joined the investigation, I’m definitely rooting for Spotify now. If Spotify prevails on market definition, Apple’s App Store monopoly is finished in Europe.
Apple has an “octopus” growth strategy, seeking to grab market after market by leveraging its iOS app monopoly. Apple Arcade is another example.”
Unconvinced by the Cupertino tech giant’s defense of the 30% commission rate, he further wrote that,
Apple’s argument against tying is that the App Store and the payment system are just one product. Indivisible. Well, atoms were considered indivisible (thus the Greek name) until subatomic particles were discovered, and Epic Games achieved nuclear fission by an act of civil obedience, as its CEO called it in a CNN interview. Epic simply delivered proof that there is demand for alternative payment systems. Even if Epic had not done so, one would just have to download Amazon’s shopping app or a parking or public transport app to come to the same realization.
Ahead of court hearings, the iPhone maker has reduced its App Store fee to 15% for small developers and is also set to introduce a new feature in iOS 14.5 update which will allow users to set a third-party music app as their default player. Now, time will tell if the App Store will remain under Apple’s control or the developers will get permission to introduce their direct payment methods.