Earlier this year, Spotify announced the arrival of a version of the iPhone app that would allow users to sign up for ad-free subscriptions directly from the app itself. However, despite the sweeping changes imposed by the Digital Markets Act and the €1.8 billion fine imposed by the EU, Spotify seems to have changed its mind. According to Emma Roth on The Verge, the company will simply add a section in Europe that describes the various subscription plans and their prices.
If approved by Apple, users of the Spotify app will be able to follow a web link to subscribe. Apple has already allowed Spotify and other so-called “reader apps” to connect to the web from their apps, however the recent EU decision gives Spotify more flexibility in describing subscription plans and pricing.
We know that Apple keeps 30% of the revenue generated from the first 12 months of subscription through the App Store, a percentage that drops to 15% for subscriptions maintained beyond the first year. The Cupertino company justifies this fee by claiming that it covers the costs of developing and maintaining the App Store. Starting with iOS 17.4, Spotify and other companies operating in the EU will have new ways to compete with the App Store. In fact, the Digital Markets Act officially mandates support for alternative marketplaces.
To date, Spotify has preferred not to collaborate with Apple despite some policy changes aimed at favoring competing services, not taking advantage of Siri integration on iPhone or HomePod, unlike other services such as Pandora.
Looking at the big picture, it’s easy to argue that Apple Music has an edge over Spotify by not being subject to a 15-30% fee for distribution on the iPhone. However, the €2 billion fine, which almost equals the price Apple paid for Beats Music (the basis of Apple Music), seems far from the final solution.
