Only a small percentage of Spotify subscribers pay a portion of their monthly fees to the Apple Store. This weakens Spotify’s argument that Apple is using required revenue sharing to stifle its rival’s ability to compete in the music streaming business.
The Swedish company complained to the European Union this spring that Apple’s 15%-to-30% cut of subscription fees is anticompetitive. The European Commission started a formal investigation of its claims last month.
Apple requires any company that makes money through the App Store to share its revenue. For subscription services like Spotify, it’s 30% for the first year and 15% afterward.
Apple’s share is less than you might think
Apple isn’t taking the EU’s investigation lying down. Part of its response is pointing out that only about 0.5% of paid Spotify subscribers give the App Store any share of their monthly fees, according to Cnet.
The revenue share for all of these of 15%. Apple isn’t collecting 30% of any Spotify subscription fees because the European company stopped allowing new subscriptions through the App Store in 2016.
A possible Spotify response to this data is to point out that Apple’s demand for 15%-to-30% revenue sharing is what made it stop taking subscriptions from the App Store. The company potentially could have more subscribers if it was doing so.
J’accuse!
An earlier part of the iPhone maker’s response is to point out that Spotify is trying to get something for nothing. It released a statement in March saying:
“After using the App Store for years to dramatically grow their business, Spotify seeks to keep all the benefits of the App Store ecosystem — including the substantial revenue that they draw from the App Store’s customers — without making any contributions to that marketplace. At the same time, they distribute the music you love while making ever-smaller contributions to the artists, musicians and songwriters who create it — even going so far as to take these creators to court.”
Spotify’s attempts to avoid paying artists higher rates has been music to Apple’s ears.
