Getty Image / Thierry Monasse
The European Union just handed Apple one of the largest antitrust fines ever doled out by the EU, a €1.8 billion euros or approximately $1.95 billion USD.
In EU history, the largest fines handed out are have gone to Google who was fined $2.7 billion in 2017 and $5.1 billion in 2018. Meta was fined $1.3 billion by the EU in 2023. The EU has handed out other massive fines but those are the largest and that make Apple’s antitrust fine the 3rd largest in EU history.
After the judgment was announced in Brussels on Monday morning, Apple immediately vowed to appeal their first-ever antitrust fine by the EU. But should Apple be forced to pay up somewhere down the line, the company is believed to have over $161 billion in cash on hand so they can easily pay the bill.
The $2 billion fine Apple faces comes roughly five years after Stockholm-based Spotify complained about unfair Apple App Store practices. Essentially, Spotify’s complaint alleged that Apple illegally restricted other music stream services and app developers from advertising cheaper music subscription models that were in direct competition with Apple Music.
In a press release, the European Commission spelled out Apple’s illegal practice. They wrote “the Commission found that Apple applied restrictions on app developers preventing them from informing iOS users about alternative and cheaper music subscription services available outside of the app (‘anti-steering provisions’). This is illegal under EU antitrust rules.”
Going on to say that Apple is the “sole provider of an App Store where developers can distribute their apps to iOS users” and that Apple “controls every aspect of the iOS user experience,” the European Commission spelled out the ways in which they found Apple to have acted illegaly.
They wrote that “the Commission’s investigation found that Apple bans music streaming app developers from fully informing iOS users about alternative and cheaper music subscription services available outside of the app and from providing any instructions about how to subscribe to such offers.”
The European Commission took into account the longevity with which Apple has been doing this when fining Apple $2 billion.
In the press release, they wrote “Apple’s conduct, which lasted for almost ten years, may have led many iOS users to pay significantly higher prices for music streaming subscriptions because of the high commission fee imposed by Apple on developers and passed on to consumers in the form of higher subscription prices for the same service on the Apple App Store.”
According to Statista, Spotify has a 30.6% global subscriber market share while Apple Music had 13.7% but that report was from 2022. Strtictly in the USA, Spotify has an estimated 44.4 million monthly subscribers while Apple Music has 32.6 million.
Ultimately, this massive fine on Apple from the EU can only be good for Spotify users and for the industry as a whole as it will force Apple to allow consumers to be more informed of more affordable subscription options.
In response to the European Commission’s fine, Apple blasted it saying there was no evidence of any harm. In a company statement, Apple wrote “The decision was reached despite the Commission’s failure to uncover any credible evidence of consumer harm, and ignores the realities of a market that is thriving, competitive, and growing fast.”
In the statement, Apple went on to suggest that Spotify was receiving preferential treatment as a European Union company. Writing “The primary advocate for this decision — and the biggest beneficiary — is Spotify, a company based in Stockholm, Sweden. Spotify has the largest music streaming app in the world, and has met with the European Commission more than 65 times during this investigation.”
Apple also pointed out that Spotify does not pay them any commission at all as Spotify sells its subscriptions on its own website and not through the Apple App Store.
The EU Commission has also ordered Apple to remove the App Store restrictions they found to be illegal by March 7th. So from here, even with Apple appealing, things will be moving very quickly.
The $2 billion Apple antitrust fine pales in comparison to the $8.95 billion Google has been hit with by the EU in recent years but it’s still such a massive amount of money that it is hard for consumers to comprehend, especially when there are more Spotify subscribers than Apple Music so the illegal restrictions appear to have been theoretical all along.
To read the EU Commission’s full report, follow the ‘press release’ link above to learn more about how Apple’s antitrust fine came to pass.