Apple Music, Spotify, war heats up

As competition in the music streaming sphere heats up, so too does the trade war between Apple Music and market leader Spotify.

Spotify, while growing its figures, must certainly be concerned that while it took eight years to reach 100 million users and 30 million subscribers, Apple Music has found 13 million users in 100 countries in just 12 months.

Plans to buy the Tidal music service signals the relentless extent to which Apple Music plans to dominate a crowded field. 

Spotify has accused it of monopolistic behaviour by using its control over the iOS platform. It says Apple refuses to update a Spotify app citing “business model rules”, and asking the Swedish company to use Apple’s billing system to “use the app to acquire new customers and sell subscriptions." 

Spotify fired off a letter to Apple charging that the rejection of the revised apps raised “serious concerns” under competition law in the United States and Europe and inflicted “grave harm to Spotify and its customers.”

Spotify general counsel Horacio Gutierrez said in the letter: “We cannot stand by as Apple uses the App Store approval process as a weapon to harm competitors.”

Apple responded with a letter that was leaked to many media outlets. It expressed disappointment at Spotify’s public attacks, and rejected any unethical aspects to its business practises.

Apple’s lawyer Bruce Sewell wrote: “Since joining the App Store in 2009, Apple’s platform has provided you with over 160 million downloads of your app, resulting in hundreds of millions of dollars in incremental revenue to Spotify.

“That’s why we find it troubling that you are asking for exemptions to the rules we apply to all developers, and are publicly resorting to rumours and half-truths about our service.” 

Another beef that Spotify has with Apple is the percentage cut that Apple is taking as app income through subscriptions, for iPhone (30%) and iPad (15%) apps. 

To circumvent this inconvenience, Spotify asked users of its app to sign up through their website. Apple retaliated by rejecting an update from Spotify on its app at the App store. 

Spotify has long been critical of some Apple corporate policies and had no qualms going public about these. 

But the latest skirmish seems to have been caused by recent comments during a speech by Massachusetts senator Elizabeth Warren – who could very well become Senator Hilary Clinton’s Vice President if she became US President – which targeted Apple’s dominance.

Senator Warren observed, “While Apple Music is easily accessible on the iPhone, Apple has placed conditions on its rivals that make it difficult for them to offer competitive streaming services.” She insinuated Apple used its muscle to “snuff out competition.”

Analysts say that while it is understandable that Spotify is miffed at corporate policies that could lose it millions of dollars, there is apprehension within the music streaming sector that public bickering could draw the attention of market regulators. Any investigation would be detrimental to a sector that is growing at a phenomenal rate and bringing many record companies back into the black.