Christian P. Pewitt Blogs: Spotify Says Apple Rejected App Upgrade "As A Weapon" Because It Competes With Apple Music

Thursday, June 30, 2016

Spotify Says Apple Rejected App Upgrade "As A Weapon" Because It Competes With Apple Music

The battle between Spotify and Apple got much nastier this week, with the music streamer's top lawyer delivering Cupertino a message that they will no longer stand by as Apple uses the App Store approval process as a weapon.

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Spotify is claiming that Apple rejected a new version of its iOS app to protect Apple Music from competitors. In a letter from its chief counsel to Apple's top lawyer, Spotify says that Apple is “causing grave harm to Spotify and its customers” by rejecting an update to the music streamer's iOS app.

"we cannot stand by as Apple uses the App Store approval process as a weapon to harm competitors”

“This latest episode raises serious concerns under both U.S. and EU competition law,” Spotify general counsel Horacio Gutierrez wrote it a letter to Apple obtained by re/code. “It continues a troubling pattern of behavior by Apple to exclude and diminish the competitiveness of Spotify on iOS and as a rival to Apple Music, particularly when seen against the backdrop of Apple’s previous anti-competitive conduct aimed at Spotify… we cannot stand by as Apple uses the App Store approval process as a weapon to harm competitors.”

Spotify has also reportedly distributed the letter to Congressional staffers. Yesterday, Senator Elizabeth Warren (D. MA) accused Apple of working to “snuff out competition.” Apple, said Warren, “has placed conditions on its rivals that make it difficult for them to offer competitive streaming services” that compete with Apple Music.

Apple's Rejection

In it's rejection of the new version of The Spotify app, Apple reportedly cited “business model rules.” It also said that Spotify must use Apple’s billing system if it “wants to use the app to acquire new customers and sell subscriptions.”

Since Apple's rules for apps on iTunes clearly require using Apple's payment system, it seems likely that Spotify sought to provoke a confrontation by designing and seeking approval for an app that did not meet those standards.

Apple recently dropped the cut it takes from in app purchases and subscriptions from 30% to 15% after the first year. But Spotify has said, that's not good enough.

Thus far, neither Apple or Spotify have commented publicly.