The European Commission fined Apple €1.84bn (£1.5bn) for breaking EU antitrust rules as the tech giant has been restricting music streaming rivals on its App Store.
Brussels announced the sanction after judging Apple had been unfairly limiting competition by banning other developers of music streaming apps from informing iOS users about cheaper services and alternative options for over 10 years.
European Commission’s executive vice-president Margrethe Vestager said that “Apple abused its dominant position in the market”, potentially causing many users to pay significantly higher prices without being able to make informed decisions about their purchases.
Only weeks before the decision, the Financial Times reported that Apple was facing a €500m fine, an amount nearly four times lower than the €1.84bn announced on Monday. But the Commission said the sanction is not merely destined to punish the gravity and duration of the infringement but has also been set high enough “to achieve deterrence” against companies reiterating those practices.
This is why a lump sum of €1.8bn was added to the initial €40m fine, which Vestager compared to a “parking ticket” for Apple.
Did Apple appeal the EU fine?
The case was set off in 2019, when Spotify complained that Apple’s 30% commission on all sales made through their App Store gave them an unfair advantage over other developers. For Spotify, Monday’s decision “sends a powerful message”, as it shows “no company, not even a monopoly like Apple, can wield power abusively to control how other companies interact with their customers.”
However, Spotify added: “While we appreciate the EC addressing this important case, we also know that the details matter. Apple has routinely defied laws and court decisions in other markets.”
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Apple has revealed it will appeal the decision. In a statement released moments after the judgement was announced, Apple questioned the Commission’s credibility on consumer harm accusations and complained about the lack of recognition received from Spotify, although “a large part of their success is due to the App Store.”
The statement reads: “Today, Spotify has a 56% share of Europe’s music streaming market – more than double their closes competitor’s – and pays Apple nothing for the services that have helped make them one of the most recognisable brands in the world.”
Why are European regulators scrutinising the tech sector?
While this is the first time Apple received an EU antitrust punishment, it is not the first time it – or any Big Tech company – has been sanctioned over anti-competitive behaviour. In recent months, European regulators including the British CMA have launched investigations and announced sanctions sometimes heavily impacting the tech sector.
A number of recent acquisition deals have prompted regulators to intervene and investigate potential antitrust violations. In 2022, the CMA blocked the multi-billion acquisition of Activision by Microsoft before allowing it under strict conditions, before forbidding the sale of platform Giphy to giant Meta.
Across Europe, the likes of Microsoft, Alphabet and Amazon have also been under scrutiny by regulators. With Big Tech companies increasingly gaining weight in the market, the EU is set to enforce the Digital Market Act (DMA) to promote fairer competition in the tech sector.
Six months ago, tech companies were warned to comply with DMA’s list of requirements, which are aimed at changing companies’ integration of digital services and management of customer data – and avoid, among other things, breaking EU antitrust rules.
