The European Commission has informed Apple of its preliminary view that it distorted competition in the music streaming market by abusing its dominant position in the distribution of music streaming apps through its App Store. Commission is also concerned that Apple applies certain restrictions on app developers preventing them from informing iPhone and iPad users of alternative, cheaper purchasing possibilities.
In its preliminary report, Commission found that Apple has a dominant position in the market for the distribution of music streaming apps through its App Store and users of Apple's devices are very loyal to the brand and they do not switch easily . This causes, app developers to distribute their apps via the App Store in order to serve iOS users, subject to Apple's mandatory and non-negotiable rules.
The Commission's concerns, as outlined in the Statement of Objections, relate to the combination of the following two rules that Apple imposes in its agreements with music streaming app developers:
The Commission's confirmed in its preliminary view is that Apple's rules distort competition in the market for music streaming services by raising the costs of competing music streaming app developers which leads to higher prices for consumers for their in-app music subscriptions on iOS devices. Consequently, Commission concluded that this conduct would infringe Article 102 of the Treaty on the Functioning of the European Union (TFEU) that prohibits the abuse of a dominant market position.
(European Commission – 30.04.2021)
NAZALI TAX & LEGAL