Thursday, March 14, 2019

Spotify: We’ll be forced to raise our prices if Apple 30% ‘app tax’ continues | Music Business Worldwide

Spotify boss Daniel Ek has warned that the streaming company will have no choice but to raise its prices if Apple’s 30% ‘app tax’ continues.

Ek made the warning during an interview with the Financial Times published today (March 14) and follows yesterday’s announcement of its filing of an anti-trust complaint against Apple with the European Commission.

Third-party app developers have to pay the 30% commission to Apple on sales made through its App Store.

Speaking to the FT, Ek said that his company has “no other choice than to accept the 30% fee put in place, which essentially would mean we would have to raise our prices for consumers all over the world”.

“I obviously think our service is superior to theirs, but a 30% price difference is a lot.”

Daniel Ek, speaking to the FT

“Apple [would get] an unfair benefit of being able to compete at much lower prices,” he added. “I obviously think our service is superior to theirs, but a 30% price difference is a lot.”

As reported by Variety, The CEO also appeared at the International Conference on Competition in Berlin earlier on Thursday  where he delivered a speech, in which he called the 30% commission “a competitor tax”.

“At Spotify, we love to compete. And when it comes to winning consumers, we want to compete fiercely. We have ping pong tables in every major office for this very reason. It’s really in our DNA,” he said, speaking at the conference.

“It’s like inviting you to a match on our ping pong table and then forcing you to play blindfolded while [Apple] change the rules throughout the game.”

Ek announced the filing with the EC via a blog post yesterday, in which he argued that Apple is “acting as both a player and referee to deliberately disadvantage other app developers”.

Yesterday (March 13) also saw Spotify launch a consumer-facing lobbying site called

The Swedish streaming company’s decision to file a formal complaint about the 30% App Store commission has resonated with its music streaming rivals including Anghami and Deezer.

Speaking to MBW, Elie Habib – Co-Founder of Anghami, the leading streaming firm in the Middle East and North Africa – has called Apple’s treatment of other music streaming business “blatantly anti-competitive”.

“I think the entire music streaming industry stands behind Spotify in this battle – because it’s blatantly anti-competitive,” added Habib.

The anti-trust filing and Ek’s subsequent blog posts and appearance in Berlin where he called Apple’s App store business practice “anti-competitive” follow, (and as noted by MBW yesterday arguably play into) the news of Spotify’s appeal against the Copyright Royalty Board’s decision to increase payments to songwriters by at least 44%.Music Business Worldwide


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