Imagine if your service was competing against a bunch of other services in a crowded but lucrative market. Nothing wrong with competition, right? Now imagine that one of you competitors took a 30% cut of everything you and your other competitors made while still having their own service out there. Is that fair? No, not really. That’s why Spotify and its fellow music streaming services are calling out Apple on its anti-competitive App Store policies.
Spotify and other streaming music services are upset with Apple’s App Store policies, which they say effectively prevent them from competing with iTunes or Beats Music, a report claimed on Wednesday. The issue, according to industry sources for The Verge, is the 30 percent cut Apple takes from all App Store purchases, including in-app transactions. In the case of Spotify, the company has to charge $13 a month for a Premium subscription bought through its iOS app to make the same amount of money it does from a $10 fee elsewhere. App Store rules further prevent apps from linking to external storefronts. More importantly, Apple has been venturing deeper into the streaming world. The company now pulls in revenue from both iTunes Radio and Beats Music, while benefiting from reduced competition on its industry-standard mobile store. Apple is believed to be working on rebranding Beats Music for an on-demand service launching later this year. “They control iOS to give themselves a price advantage,” one of the sources said. “Thirty percent doesn’t go to any artist, it doesn’t go to us, it goes to Apple.”
