European Union Fines Apple $1.95 Billion for Anti-Competitive Practices in App Store
Apple faced a hefty fine of 1.8 billion euros ($1.95 billion) from European Union regulators on Monday for allegedly stifling competition among music streaming rivals. The penalty comes after a five-year investigation initiated by Spotify, one of Apple’s biggest competitors, which accused the tech giant of using its dominant position in the App Store to exclude other music streaming services.
Margrethe Vestager, the European Commission executive vice president overseeing competition policy, stated that Apple had abused its market dominance for distributing music streaming apps through the App Store for a decade. The fine reflects the financial power of Apple and the harm caused to millions of European users by its conduct.
Apple, however, plans to appeal the ruling, arguing that the facts do not support the decision. The company has been under scrutiny for requiring apps to use its in-app payment service, which charges up to a 30 percent commission on transactions. Regulators in the Netherlands and South Korea have also challenged Apple’s practices, leading to ongoing disputes.
The European Union’s action against Apple is part of a broader effort to regulate the tech sector, with recent laws focusing on data privacy, competition, content moderation, and artificial intelligence. The fine imposed on Apple is the most severe since 2016 when the company was ordered to pay €13 billion for unpaid taxes to Ireland.
In response to the regulatory pressure, Apple announced plans to comply with the new law by offering developers three options for app distribution and payment processing. However, developers, including Spotify, have criticized Apple’s proposal, arguing that it does not fully comply with the law and limits their ability to interact with customers.
Spotify, a vocal critic of Apple’s App Store policies, welcomed the penalty as a message against abusive power in the tech industry. The ongoing battle between Apple and its competitors highlights the challenges of balancing market dominance with fair competition in the digital marketplace.
