It was inevitable that the success of Apple Music was going to have some people screaming about anti-competitive practices, and that’s exactly what happened. Yesterday, senator (and former SNL alumni) Al Franken threw his hat into the ring by writing a letter requesting that the Justice Department take the matter seriously.
Franken’s letter (which you can read here) takes issue with the fact that Apple is potentially hurting competitors like Spotify and Rdio by charging them 30 percent extra fees for subscriptions gained through the App Store.
Because of this, Spotify charges customers $13 per month within its iOS app, but only $10 per month if they sign up on the Web. Since Apple bans app which link to “external mechanisms for purchases or subscriptions” the company is unable to spread the word about the cheaper subscription price — although it recently tried to do this by sending out a mass email to all its iOS subscribers.
Apple, meanwhile, charges a flat rate of $10 per month for Apple Music, which makes its service appear cheaper. Franken writes that this could, “undermine the competitive process, to the detriment of consumers.”
Personally, I think if companies are going to sell their products through Apple, they should be subject to whatever terms and conditions Apple wants to set. But then that’s not always how these antitrust cases are judged — which Apple knows all too well.
Someone should tell Franken that the FTC anti-competitive investigation is already happening, too.
Source: The Verge
Luke Dormehl is a U.K.-based journalist and author, with a background working in documentary film for Channel 4 and the BBC. He is the author of The Apple Revolution and The Formula: How Algorithms Solve All Our Problems … and Create More, both published by Penguin/Random House. His tech writing has also appeared in Wired, Fast Company, Techmeme and other publications.
37 responses to “U.S. senator backs FTC investigation into Apple Music”
Because they have nothing else better to worry about.
How can it be anti-competitive if people can buy Spotify from their site at the same rate Apple charges for their music?!? Sounds like another politician with way too much free time.
Al Freaking Franken…should have stayed a comedian…because he’s one of the biggest jokes around.
I guess all the other problems are fixed.
The question, I guess, is whether Spotify is gaining customers through Apple’s platform that it otherwise wouldn’t have gained. If the answer is yes (and I think it is), then Apple is entitled to a reward for facilitating that ‘lead’ to Spotify. As such, I don’t think they’re being anti-competitive. I think it sucks for Spotify, but I don’t think Apple can be taken to task for this one. In the same way, Apple and Spotify take a share of the money paid to artists (labels) for providing for the ‘sale’ of their music on streaming.
Exactly! If Apple cannot be allowed to charge other companies for providing leads to customers, and a marketing platform are they just expected to make their App Store a total free charity every company is entitled to use for free? This whole thing is total b.s.
I don’t think your landlord also has the same business that you provide. oh and while you are at it, I am sure your landlord does not go to your clients and provides the same service for cheaper while making you pay more. OHHH and while still doing that, I am also sure your landlord does not tell your suppliers to leave you and sign up exclusive deals with him because he’s got more influence.
It was an analogy butthead. Spotify can offer the same exact price on their website and numnuts who decide to go with Spotify can then login from the app and pay the same exact price that they’d pay for Apple Music. Some people have more influence in the world. It’s a simple matter of being in business longer. Should businesses or even individuals not try to gain more experience and clout over time? You and I both know the answer is no… But while we’re at it, why doesn’t Spotufy just build their own App Store?
it’s not about gaining experience, it’s about using your influence to pressure labels to sign exclusive deals. Let me put it this way – if Microsoft decided to have an exclusive deal with Intel so that only Windows could run on Intel devices (because of it’s influence on desktop sales), would you not call foul?
and lol trust me when I say this – if Apple did allow for multiple app stores, everyone would have their own app store :p . Apple wants a cut of Spotify’s premium if those users have paid on an iPhone (what I don’t get is why users don’t just go to the website and pay there) and while taking this cut, they are also trying to score exclusive deals with the same guys that are now in business with Spotify.
Your point is moot. There is nothing equal in what you’re saying. There already are multiple App Stores. Spotify is already in those, and Googke runs a competing service, so does Amazon, and Samsung is trying to do the same. Pandora signed an exclusive deal with my favorite band and I went to their service so I could listen to that band. Artists and record labels sign deals for various reasons, but all because it gives them some advantage. It’s the way life works. The only possible problem at all would be if Apple told record labels not to sign deals with Spotify or competing services. No evidence that they did. Only thing said by you is that they have an App Store. They charge 30% without prejudice. WITHOUT PREJUDICE! You can easily go to a website and save your precious $3. Spotify should pay their operating costs to be on the App Store, LIKE EVERYBODY ELSE, and not hoist those onto their customers. That is their choice. How you can support them doing that to you is purely idiotic.
my point still stands. by default you can only install from the app store on an iPhone/iPad/iPod/iWatch. This means Apple is first forcing Spotify in it’s app store without which they can’t reach their customers and have such services pay 30% (not like Spotify can get to it’s users on iDevices from some 3rd party app store). But since Apple owns it’s own store – it does not have to pay that 30%. This is more of a Spotify vs Apple Music not an Spotify vs Rdio (as that’s more of a level playing ground). And FYI Apple is using it’s influence to make Spotify stop it’s free streaming service (where it makes most of it’s revenue via ads). You somehow think that Spotify should eat Apple’s app store cost while Apple has no such cost. Here’s a link to that.
http:// www (dot) theverge (dot) com/2015/5/4/8540935/apple-labels-spotify-streaming
And signing exclusive deals is not the issue, but signing an exclusive deals by using your influence and screwing over a competitor is.
I stick by my analogy.
Then why did Spotify send out an email to customers encouraging them to pay through the website if they wanted to pay $9.99?
because they are trying make sure customers pay less. What I want to see is if it’s possible to just direct them to their website when they try to pay via the app.
Here
exactly! they are just letting you know that you could pay less. Eitherway, the issue is – Spotify gets their share, consumers get less, they are trying to get rid of Apple being the middleman. They didn’t do this before because they didn’t mind it. Apple got 30%, Spotify got it original share, and consumer paid more.
There is an “easy” way that customers can pay the same they would at Apple Music. “Easy” being Spotify’s own words. Case closed. b-bye
I don’t see what you are getting at. Easy does not mean Apple is still using it’s influence to take out it’s competition. First it’s trying to stop free streaming alltogether, then we have competitors paying Apple 30% of their iOS profits, while Apple Music happily comes pre installed. Over all that, Apple is still trying to screw these guys over. so yes case closed – Apple is breaking the law.
You can still get your Spotify for the same price. You can still get free streaming. You can set up your account in an “easy” way through the website. And you can login to the app with that setup via the app. No one is trying to stop your cheapness from having expression in the world dude. Calm down and shake off the paranoia man.
lol all that does not mean Apple is not being anti competitive.
In your definition being competitive is being anti-competitive.
being competitive is totally cool (and that drives innovation), but then using your influence to hurt your competitors (not the product itself) is anti competitive.
You’ve not demonstrated any way that Apple is doing that. You’ve only demonstrated them as having an App Store.
They pre install their services where people want it or not (by bundling it with the default music player) – while it’s competition has the pay 30% more to get the foot in the door.
They are trying to use their influence to get publishers kill free streaming on Spotify (which they don’t have themselves)
Mmm… hmmm, yeah right. Spotify is free to go manufacture the new SpotiPhone and pre-install Spotify on that thing.
let’s use the analogy shall we? Oh Apple, please go create your own desktop CPU that’s not X86, and run OS X on it ( I know they ran it on PowerPC, but let’s be real x86 is what macs popular anyway)
They’re already rumored to be working on that.
they are working on ARM for OS X but I doubt if they’ll release it to the public without legacy support.
No one is locked of anything. Not the App Store, extra fee, no fee/free streaming, or x86 man
that was just an analogy of a company using it’s influence to screw over a competitor. But I guess you don’t see it at all. Let’s agree to disagree lol.
No worries… It was fun schooling you
that was just an analogy of a company using it’s influence to screw over a competitor. But I guess you don’t see it at all. Let’s agree to disagree lol.
If Spotify wants to build a mobile phone and OS, they’re welcome to. Until then, they have to pay to use others’ platforms. Apple is doing nothing wrong.
No, links to subscribe elsewhere are against App Store rules. Apple is well within its rights here.
I do not believe they have a case. These services are available online and on other platforms. They also can be paid for on other platforms without having to go through Apple. If a company like Spotify allows consumers to buy through the App and doesn’t make them purchase online to circumvent the ‘Apple Tax’ then they should make that option more readily available.
I like how everyone here is against Spotify, but if the same was turned around, everyone would be supporting Apple. The anti trust here is that they used their influence (market share) to hurt their competition which is not fair. That said, on one is suing Apple just yet, they are just investigating IF that is the case.
Nope, not true in the least. You’re completely in the wrong. The FTC will be moving on any day now.
I hate these fucking demoncraps. This commie POS was never funny.