The music streaming war is heating up.
Spotify claims that Apple is blocking competition after the App Store rejected an updated version of its iOS app. According to a letter Spotify sent to Apple’s legal team on June 26, Apple’s rejection stems from an anti-competitive practice to boost Apple Music. The letter was sent to some members of Congress this week and was originally reported by Recode.
“We cannot stand by as Apple uses the App Store approval process as a weapon to harm competitors,” wrote Spotify general counsel Horacio Gutierrez to Apple general counsel Bruce Sewell. Apple claimed that the new Spotify app was rejected because it violated “business model rules.”
“We cannot stand by as Apple uses the App Store approval process as a weapon to harm competitors.”
Update: Sewell’s response letter was posted on BuzzFeed. In it, Apple slams Spotify for asking for “preferential treatment” even after the App Store was the driving force behind 160 million downloads to the Spotify app.
Apple claims that the company did not alter its practices or rules when Apple Music launched and Spotify became a competitor. The App Store rules apply to all developers, not just Apple’s direct competitors.
“We find it troubling that you are asking for exemptions to the rules we apply to all developers and are publicly resorting to rumors and half-truths about our service,” Sewell wrote.
“We find it troubling that you are asking for exemptions to the rules we apply to all developers.”
According to App Store rules, Spotify must use Apple’s billing system if it wants to sell subscriptions in-app. However, Spotify has contested this system publicly before, and it seems the company is planning to use the latest rejection as legal ammunition against Apple.
The story behind the story: Over the last year, Spotify has criticized Apple’s App Store practices that seem to punish third-party music subscription apps in favor of the native Apple Music. Apple does not allow app-makers to use an alternate billing system for in-app subscriptions, and the company charges a 30 percent fee, otherwise known as an “Apple Tax.”
Because Apple discourages alternate subscription options outside its in-app billing system and apps must go through the App Store to be distributed onto iPhones, Spotify claims Apple’s practices are anti-competitive. And some members of Congress agree. This week, Senator Elizabeth Warren said that “Apple has long used its control of iOS to squash competition in music.”
“Apple has long used its control of iOS to squash competition in music.”
Spotify has fought back against the Apple Tax by encouraging users to subscribe via the website, not the app. Previously, Spotify subscribers who subscribed via the iOS app were charged $13 a month for the service to account for Apple’s cut. Otherwise a Spotify subscription is $10 a month, the same as Apple Music.
Spotify has since turned-off in-app subscriptions.
Sign up for MIS Asia eNewsletters.