Music exec continues to bash Apple’s 30 percent cut of App Store purchases while in Berlin
Spotify CEO Daniel Ek continued to rip Apple on Thurday, one day after the music streaming service filed an anti-competition complaint against the tech giant with the European Commission, saying what started off as a “mutually beneficial relationship” between the companies has turned into something that’s “completely unsustainable.”
Ek made his comments while speaking at the International Conference on Competition in Berlin, Germany. Flanked by a presentation slide declaring “Apple isn’t playing fair,” Ek reiterated his stance that Apple enjoys an “unfair advantage” by taking a 30 percent cut from digital services that use its payment system.
— Spotify News (@SpotifyNews) March 14, 2019
“Let’s call this 30 percent revenue-share exactly what it is – a competitor tax,” Ek said on Thursday, according to Variety. “As we all know, iOS and the App Store is the only way to offer our service to anyone with an iPhone or iPad. That’s over a billion people around the world. So not being on their platform is just not an option for us — or really for any competing internet service in this day and age. Apple knows this.”
Ek said Spotify isn’t able to be “price competitive” with Apple Music because if it wants to have its users upgrade to its Premium service directly through Apple, it must pay the 30 percent premium. He said Spotify’s decision to stop paying the tax in 2015 and only allow customers to upgrade outside of the Apple ecosystem has hampered Spotify.
“Based on our choice not to pay the tax — the result is that our customers must upgrade to Premium elsewhere, such as on their desktop. The catch 22 is that we are not allowed to tell users how to upgrade,” Ek added. “We are essentially faced with a ‘gag order’ that prevents us from communicating with our own customers about our service.”
Spotify isn’t the only major tech company that has scoffed at the “Apple tax” in recent years. At the end of 2018, Netflix stopped letting users to sign up through the App Store, allowing the streaming powerhouse to forego paying Apple its 30 percent cut. The move, according to data from Sensor Tower, would take more than $250 million away from Apple, considering Netflix grossed $853 million on the App Store last year.
Ek said the Apple and Spotify started off as a symbiotic relationship, but that changed after Apple Music launched in 2015. The streaming service had 56 million customers at the end of 2018, while Spotify reported last month it has more than 200 million monthly users, including 96 million paying customers.
While acknowledging Apple should be able to put “certain restrictions” on apps to guarantee quality, security, and safety measures, Ek argued Apple shouldn’t be able to impose stiff restrictions that stifle its competitors.
“It’s like inviting you to a match on our ping-pong table and then forcing you to play blindfolded while we change the rules throughout the game,” Ek said, according to The Hollywood Reporter.