Supervisor Elham AbolFateh
Editor in Chief Mohamed Wadie

EU Imposes €1.8 Bln Fine on Apple for Antitrust Violations

Mon 04 Mar 2024 | 06:09 PM
Israa Farhan

The European Union levied a substantial €1.8 billion ($1.9 billion) antitrust fine against Apple on Monday, accusing the technology behemoth of preferentially promoting its own music streaming service to the detriment of competitors.

The European Commission's investigation concluded that Apple's imposition of restrictions on app developers, which barred them from informing iOS users about more affordable music subscription services accessible outside the app, constituted a violation of EU antitrust regulations.

According to the Commission, such practices are illicit under the European Union's antitrust statutes.

Apple's policy of extracting a 30% commission on sales transacted through iOS applications, coupled with its prohibition on apps directing users to external sign-up avenues to evade this surcharge, was highlighted as particularly contentious.

Under the newly instituted Digital Markets Act (DMA), Apple, alongside five other major entities, is mandated to align with the EU's competition laws by March 6.

The EU's stringent oversight extends beyond Apple, with antitrust inquiries targeting several other technology giants, including an examination of Microsoft's integration of the Teams messaging application.

In recent years, the EU has imposed cumulative fines amounting to €8 billion on Google, including a notable 2022 sanction for configuring Android smartphones to prioritize the Google search engine.

European Commissioner for Competition, Margrethe Vestager, emphasized the directive issued to Apple to eliminate restrictive clauses and desist from similar practices henceforth, stating, "Apple is now obligated to permit music streaming developers to engage directly with their clientele."

Vestager elucidated that the considerable €1.8 billion penalty serves as a deterrent, noting that the foundational sum of the fine would otherwise have been relatively nominal. This penalty represents 0.5% of Apple's global revenue, as per Vestager's disclosure.

Apple, planning to challenge the verdict, criticized the decision for disregarding the competitive and rapidly expanding nature of the market and for failing to identify any tangible consumer detriment.

The company highlighted Spotify, with a commanding 56% share of Europe's streaming market, as the primary beneficiary of this ruling, pointing out Spotify's frequent consultations with the commissioner over eight years.

"Ironically, in the name of competition, today's decision just cements the dominant position of a successful European company that is the digital music market's runaway leader," Apple said.