The European Commission announced on April 30 that it would impose a fine of 1.8 billion euros (about 14.2 billion yuan) on Apple for abusing its dominant market position in the app store and restricting competition among **streaming** apps. This is another major blow to the EU's antitrust enforcement and one of the biggest challenges Apple faces in Europe.
The European Commission said that after nearly two years of investigation, it was found that Apple violated the EU's competition regulations, which was manifested in two aspects: first, Apple mandated **streaming** app developers to pay a 30% commission through its app store, thereby increasing the subscription rate**; The second is that Apple prohibits **streaming** app developers from introducing cheaper payment methods outside of the Apple App Store to iPhone users, or informing users that subscriptions to the Apple App Store **are higher than those of other channels**.
According to the European Commission, these practices harm not only the developers of streaming apps, but also consumers, as they are deprived of more options and better ones. The European Commission also pointed out that Apple's App Store is the only channel for iPhone users to access streaming apps, while Apple's own streaming service, Apple Music, is not affected by these restrictions, creating an uneven playing field.
Margrethe Vestager, the EU's competition commissioner, said in a statement: "By setting unfair rules, Apple is protecting its monopoly by weakening the innovation and competitiveness of its competitors." This is unacceptable, and we have decided to impose a fine on Apple in order to restore fair competition. ”
This is the third-largest fine in the history of EU antitrust enforcement, behind the two fines imposed on Google in 2017 and 2018, at €2.4 billion and €4.3 billion, respectively. This is also the first time that Apple has been fined by the European Commission, but it is not the first time that Apple has been in dispute in Europe. Apple has also clashed with the European Union over tax issues, privacy concerns and consumer rights issues.
Apple has strongly opposed the EU's fines and said it will defend its rights and interests through legal means. "The EU's action is a blow to millions of European developers who have used our platform to create amazing apps and contribute to the entire European economy," an Apple spokesperson said in a statement. The EU ignores the competitive status quo in the **stream** market, and also ignores the tremendous value that our app store provides to developers and consumers. We believe our actions are lawful and we will appeal this decision. ”
The EU's fine follows Spotify's complaint. Spotify is the world's largest streaming service provider and one of Apple's main competitors. In March 2019, Spotify officially submitted an antitrust complaint against Apple to the European Commission, accusing Apple of using its market position in the app store to restrict the development of **streaming** apps such as Spotify, while giving its own Apple Music an unfair advantage.
Daniel Ek, CEO of Spotify, wrote in a blog post: "Apple has made many outstanding contributions in the field of technology, and we respect their success. However, Apple should not use the power of its platform to stifle competition and harm consumers. We are asking the EU to take action to ensure that Apple follows the same rules as other companies and gives all apps a fair chance to compete. ”
The EU's fine is a heavy blow to Apple and a huge challenge to its app store. Apple's App Store is a core component of its ecosystem and one of its significant revenues**. According to Apple's financial report, in 2020, Apple's service business revenue reached $53.6 billion, including commission income from app stores. Apple's App Store currently has more than 1.8 million apps in 150 countries and territories, with more than 500 million people visiting it every week.
Apple has always insisted that the rules of its app store are designed to protect the security and privacy of users, as well as to improve the quality and innovation of apps. Apple also says that its app store offers a huge opportunity for developers to help them achieve business success. Apple released a report on its official website, saying that its app store contributed $643 billion to the global economy in 2020, creating more than 2.4 million jobs.
However, the EU is not the only body that has challenged Apple's app store. In the U.S., Apple is also facing a lawsuit from Epic Games, the developer of Fortnite and another of Apple's rivals. Epic Games has accused Apple of abusing its app store monopoly position and violating U.S. antitrust laws. The case is currently being heard in federal court in the U.S. state of California and is expected to open on May 3**.
In addition to the European Union and the United States, Apple's App Store is also regulated in other countries and regions. In Australia, the Consumer and Competition Commission (ACCC) released a report on November 27 criticizing Apple and Google's app stores for a lack of transparency and accountability, recommending measures to protect the rights and interests of consumers and developers. In South Korea, the National Assembly is pushing through a bill that would prohibit Apple and Google from forcing developers to use their app store's payment system, which has passed the Legislative and Judicial Committee and is expected to be finalized in May.
As can be seen from the above, Apple's app store is facing regulatory pressure on a global scale, which poses a threat to Apple's business and reputation. How Apple will respond to these challenges and whether it will make changes to its app store's rules and policies remains an unknown. But what is certain is that Apple's app store will no longer be a garden that no one cares about, but an arena full of controversy and competition.
Info**:
: Apple fined €1.8 billion by EU antitrust for abuse of app store terms. politico.
: Apple fined €1.8 billion by EU antitrust for abuse of app store terms. European Union.
:Apple's app store contributed $643 billion to the global economy in 2020. Apple.
:The UK's Competition and Markets Authority launches an investigation into Apple's App Store. UK Competition and Markets Authority.
: Australian Consumer and Competition Commission publishes app store market report. Australian Consumer and Competition Commission.
: South Korea's parliament pushes bill to ban Apple and Google from forcing app store payments. South Korea***