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Apple Faces €500 Million EU Fine for Alleged Anti-Competitive Practices

 |  February 18, 2024

In a recent development, tech giant Apple is reportedly set to pay approximately €500 million (equivalent to about $539 million USD) in fines to the European Union (EU) for purportedly stifling competition against its music streaming service, Apple Music, on the iPhone platform. The Financial Times revealed this morning that this substantial penalty follows an investigation by regulators in Brussels, Belgium, triggered by a complaint from Spotify. The complaint alleged that Apple had been obstructing other apps from informing users about more cost-effective alternatives to Apple Music.

At the heart of the issue lies Apple‘s stringent control over its App Store ecosystem and payment system. Spotify raised concerns in 2019, accusing Apple of creating an uneven playing field that favored Apple Music over other streaming services. This accusation catalyzed an EU investigation in the subsequent year. The EU’s scrutiny honed in on Apple’s policy that forbade app developers from linking to external subscription sign-up pages within their apps, effectively limiting consumer choice. Notably, Apple revised this policy in 2022 under regulatory pressure from Japan.

Related: EU Regulators Probe Deeper Into Apple Pay

While the €500 million fine may appear substantial, it pales in comparison to the staggering amount of nearly $40 billion initially proposed by the EU, amounting to 10 percent of Apple’s annual global turnover. Apple’s legal battles with European authorities are not new; in 2020, the company faced a fine exceeding $1 billion, which was later reduced to around $366 million by French authorities after Apple lodged an appeal.

When approached for comments, Apple’s representative, Emma Wilson, declined to engage in speculation and redirected inquiries to previous statements made by another spokesperson, Hannah Smith. Smith, speaking on behalf of Apple last February, expressed the company’s hope that the Commission would cease pursuing the case, labeling it as lacking merit. Meanwhile, European Commission spokesperson Lea Zuber opted not to provide any comment on the matter.

This latest development underscores the ongoing regulatory scrutiny faced by tech giants like Apple regarding their market dominance and treatment of competition within their ecosystems. As Apple navigates these legal challenges, the outcome of its dealings with EU regulators will undoubtedly have far-reaching implications for the future of competition in the digital marketplace.

Source: The Verge