Apple late Thursday issued a statement responding to, and refuting, anti-competition claims leveled by Spotify this week, a rare move for the tech giant who typically refuses to publicly engage with competitors lobbing serious accusations. Graphic from Spotify’s blog post announcing its European Commission complaint against Apple.In a press release published to Apple’s website, the company says it is obligated to respond to claims made in an anti-competition complaint Spotify lodged with the European Commission on Wednesday. While Spotify has yet to release a public version of the complaint, founder and CEO Daniel Ek outlined the grievance in a blog post. Apple’s statement is in response Ek’s criticism, claims it deems financially motivated “misleading rhetoric.””After using the App Store for years to dramatically grow their business, Spotify seeks to keep all the benefits of the App Store ecosystem — including the substantial revenue that they draw from the App Store’s customers — without making any contributions to that marketplace,” Apple says. “At the same time, they distribute the music you love while making ever-smaller contributions to the artists, musicians and songwriters who create it — even going so far as to take these creators to court.”Spotify’s complaint focuses on Apple’s facilitation and stewardship of the App Store, and alleges the iPhone maker constructs artificial barriers to limit third-party services that compete with products like Apple Music. Apple’s statutory 30 percent cut of all App Store purchases is central to Spotify’s argument, as are supposed restrictions to customer data and technology like Siri, HomePod and Apple Watch. Together, the policies constrain user choice, Spotify says. Apple counters Spotify’s claims of discrimination by noting 84 percent of developers with wares available in the App Store do not pay Apple when users download or run their apps. Apps that are free to download or earn revenue through advertising are not charged the 30 percent fee. Transactions made outside an app are not “taxed,” as Spotify puts it, and Apple does not charge apps that sell physical goods like ride-hailing services.The 30 percent fee applies only to “digital goods and services that are purchased inside the app using our secure in-app purchase system,” Apple says, adding that Spotify failed to mention the charge drops to 15 percent for subscription services who retain users for longer than one year. According to Apple, a bulk of Spotify’s users make no contribution to the App Store since they use free, ad-supported tier of the music streaming service. “Even now, only a tiny fraction of their subscriptions fall under Apple’s revenue-sharing model. Spotify is asking for that number to be zero,” the statement reads.Let’s be clear about what that means. Apple connects Spotify to our users. We provide the platform by which users download and update their app. We share critical software development tools to support Spotify’s app building. And we built a secure payment system — no small undertaking — which allows users to have faith in in-app transactions. Spotify is asking to keep all those benefits while also retaining 100 percent of the revenue.Spotify wouldn’t be the business they are today without the App Store ecosystem, but now they’re leveraging their scale to avoid contributing to maintaining that ecosystem for the next generation of app entrepreneurs. We think that’s wrong.The remainder of Apple’s statement addresses Ek’s assertions point by point, taking issue with claims that it blocks access to products and hinders the release of app updates. So far, Apple says it has approved nearly 200 updates that resulted in more than 300 million Spotify app downloads, and only requests “adjustments” to submitted software when the streaming service attempts to “sidestep” developer guidelines. Apple reportedly reached out to assist Spotify in the integration of Siri and AirPlay 2 “on several occasions” only to be told that the company is “working on it.” Further, Apple notes Spotify has access to the same tools and assets that are made available to other app makers.”We found Spotify’s claims about Apple Watch especially surprising. When Spotify submitted their Apple Watch app in September 2018, we reviewed and approved it with the same process and speed with which we would any other app,” Apple says. “In fact, the Spotify Watch app is currently the No. 1 app in the Watch Music category.”Ek in his blog post claimed Apple locked Spotify and other competitors out of certain Apple-run services, including Siri, HomePod and Apple Watch.
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