Apple hit with €1.8bn fine for breaking EU law over music streaming

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Brussels has fined Apple €1.8bn for stifling competition from rival music streaming services, the first time the iPhone maker has been punished for breaching EU law.

Margrethe Vestager, the bloc’s competition chief, said the tech giant had broken EU antitrust rules for a decade by “restricting developers from informing consumers about alternative, cheaper music services available outside of the Apple ecosystem”.

She said this amounted to abuse of the group’s dominant position for music streaming on its App Store.

Apple said it would appeal against the decision, signalling years of legal fights in EU courts.

It said the commission had reached its decision despite failing to “uncover any credible evidence of consumer harm”, adding that Brussels’ reasoning “ignores the realities of a market that is thriving, competitive, and growing fast”.

The penalty is the third-biggest antitrust fine the European Commission has imposed.

The commission said it had decided on a fine of more than €1.8bn, going beyond previous guidelines, to provide a deterrent not just for Apple but for other “companies of a similar size and with similar resources”.

It also said it had factored the consideration that “Apple submitted incorrect information” in the process.

In comparable decisions, Google has been fined roughly a total of €8bn over a decade for infringements of antitrust law although the search giant is contesting the penalties in court.

The commission began its investigation into Apple in 2019 after music streaming app Spotify launched a complaint accusing the company of anti-competitive behaviour.

EU regulators found that Apple’s actions had resulted in users paying “significantly higher prices” for music streaming services.

The iPhone maker charges a 30 per cent fee for all sales through the App Store, a cost the commission said had been passed on to consumers in the form of higher subscription charges.

As part of Monday’s ruling, the commission also banned Apple from blocking apps from offering their services outside the iPhone maker’s iOS software.

Apple has never previously been fined for antitrust infringements by Brussels, but the company was hit in 2020 with a €1.1bn fine in France for alleged anti-competitive behaviour. The penalty was revised down to €372mn after an appeal.

The EU’s action will reignite the war between Brussels and Big Tech at a time when digital groups are being forced to show how they are complying with landmark new rules aimed at tackling the power of Silicon Valley behemoths.

Tech companies face a March 6 deadline to comply with the new Digital Markets Act. The law has already led Apple to propose a series of changes to its iOS software, such as allowing users to download apps from other sources and access alternative payment systems.