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Addressing Spotify’s Claims

• wodenokoto 8y ago
  Why can I buy train tickets on iOS apps using any payment provider, but not spotify-subscription? It can't be that it is a subscription service, because I can also buy commuter-tickets as a subscription service using CC. Is it that you can't sell competing services on app-store without paying apple tax or is there an arbitrary list of services that requires apple tax?
  • philo23 8y ago
    Not that I completely agree with it, but I think the difference they go off is a purchase of something physical (e.g. a book from Amazon) vs something digital (e.g. an audiobook from Audible)
  • andromeduck 8y ago
    Because it's not a purely digital product, RTFA.
• ocdtrekkie 8y ago
  This is a surprisingly open response to what is likely to be a legal matter, particularly given Apple's usual silence on... most everything. I definitely take issue with it's avoidance of the core issues though: That the services they provide aren't optional on the iPhone. They make it sound like connecting Spotify to users, and allowing them to use their in-app purchase mechanism is a service they offer that they should be paid for. But the reality is, that Spotify has no choice but to use that service, which is the definition of a monopoly. In that, I feel they didn't meaningful counter Spotify's primary anticompetition claim, and I look forward to seeing what the EU makes of it.
  • zaidf 8y ago
    I think Apple is going to find itself standing alone by the time the dust settles on this issue. Their 30% tax is a disservice to its own customers, not just app publishers. Apple tries to counter that the problem is Spotify. It's Spotify that is money-hungry, Apple claims: Underneath the rhetoric, Spotify’s aim is to make more money off others’ work. The only problem with this argument is that Spotify is just one example. App publishers of all sizes have expressed grave dissatisfaction over this issue. Ultimately, this has led to a poorer experience for Apple's own customers in the form of higher fees for in-app purchases or weird, convoluted checkout flow that requires you to goto your browser to finish a transaction.
    • ocdtrekkie 8y ago
      Apple won't find itself standing alone. Other major distributors like Google and Valve are both happy to take 30% off the top of app sales too, and if the chance comes to speak up in support, they will. But the difference is both of them can be circumvented by competitors, for instance Epic Games, who is challenging both. (Epic is launching an Android store soon.) Apple can't be, and that's likely to be the crux of any action against them.
      • chrischen 8y ago
        I currently subscribe to Spotify, use the iOS Spotify App, and do not make payments through in-app payments nor do I pay the 30% Apple tax. So it is circumventable, and Spotify is just "optimizing" their revenues here. So at least compared to Steam, Apple's platform is actually more open since you aren't required to pay through Apple's platform. Though I'm not sure on the current requirements for in-app purchases, so correct me if I'm wrong.
        • social_quotient 8y ago
          Discussion or capture of money must go through apple. The hinting of circumventing has to be really vague And creates a weird ux. IMO you have to follow the rules and pay the toll https://developer.apple.com/app-store/review/guidelines/#in-app-purchase https://developer.apple.com/app-store/review/guidelines/#in-...
        • snorlaxle 8y ago
          I buy Steam games from Humble Bundle all the time. The developers can actually generate steam keys and sell their game directly. https://partner.steamgames.com/doc/features/keys https://partner.steamgames.com/doc/features/keys As far as I know you can't do that on iOS. There's also nothing stopping the devs from selling IAP themselves on their own website. So no, Steam is much much more open than Apple's App store. Not to mention the fact that Steam is completely optional and the App store is not.
          • 8y ago
  • tener 8y ago
    My bet is they decided to respond due to PR issues. The response from the EU will likely depend to some degree on the public reception of Apple. The Spotify post looked very strong, so even if they don't fully dismantle it (as you noticed they dodge some issues) they provide enough arguments that it isn't immediately clear to bystander who is right.
    • saagarjha 8y ago
      > My bet is they decided to respond due to PR issues This is the strange bit, since Apple does this very rarely. Or at least, they used to…
  • chrischen 8y ago
    From my understanding, Spotify is arguing that it should be void of platform/processing fees for in-app payments, potentially zeroing fees for everyone... That's a hard argument to make, because if they win that, then Stripe wouldn't be able to charge processing fees either. You'd get into an argument of what fees would be fair, and in-app payments are not a requirement for the app store so it's hard to argue it. I think the most likely scenario is that Apple will capitulate and remove any restrictions from apps soliciting payments in a web browser from within the app (are there any restrictions on this?).
    • ocdtrekkie 8y ago
      Yes, currently Apple prohibits developers from linking to their websites subscription signup. I agree if Apple provides payment processing, they should get some cut (though not 30%). The issue is that Apple prohibits signing people up from anything but their IAP feature.
      • chrischen 8y ago
        I think the % for processing/platform is justifiable and hard to argue against setting that % for them. The most likely outcome is that they will either remove the restriction from advertising alternative payment methods on signup, and in exchange Apple can do what it wants with in-app payments.
        • ocdtrekkie 8y ago
          I agree that the best case is that Apple sets the price it does business at, but that there are reasonable ways for the app to use a different payment provider, even if just by linking to the web. This keeps Apple's price in check naturally... As they'll need to keep the price competitive enough that the convenience of using their service is worth it.
          • chrischen 8y ago
            I can also see the argument that for users that discover an app through the App store, they must pay the platform/acquisition costs. But I agree a lifetime 15% is unfair. Best case scenario is 1) Apple switches their platform monetization to a more direct model where you pay to advertise your app in the App store. This will get tricky because their "Top apps" list still serve as advertising but you can't just remove an app from there because it refuses to pay. 2) Apple removes the restrictions against advertising alternative payment/subscription methods
  • mythz 8y ago
    Apple does not have a monopoly on Smart Phones or App Stores. They're able to as much as anyone to control how their platform is used - there's no law against maintaining a closed and curated platform and your product or platform is not considered a Market in by itself. There's also no law against having a monopoly, only for abusing your monopoly in one market to gain an unfair advantage in a different one.
    • aaomidi 8y ago
      Which is what spotify is arguing is happening with Apple Music
      • mythz 8y ago
        iOS isn't considered to be a market so they don't have one to abuse. Unless the courts declare that iOS is a market then the App Store would be considered to have a monopoly on App Stores in iOS, but you can't have a monopoly on your own product/platform (then everyone would be a monopolist). A monopoly is measured against the overall market. If Android didn't have an App Store or it was the size of Windows App Store then iOS App Store could be considered a monopoly, but not at the fraction of the user base that iOS has now.
        • aaomidi 8y ago
          The fraction doesn't matter at all in this case. Spotify is saying they're abusing the 30% to be able to push their own music application for cheaper.
          • mythz 8y ago
            It doesn't matter in this case because iOS isn't a Market and the iOS App Store doesn't have a monopoly on App Stores. They can appeal to the public about the unfairness of it all (which is likely what their open letter was designed for) but they don't have a legal case against Apple nor an inalienable right to be able to participate in their platform on their own terms.
          • 8y ago
  • hjk05 8y ago
    > which is the definition of a monopoly. Like Walmart has a monopoly on shelf space at walmart. Apple does not have a monopoly on neither Phones nor on application markets for phones. They have a very attractive market, which they control, but not a monopoly.
  • supernova87a 8y ago
    You know, it's a funny thing, how to define anticompetitive and monopoly practices, depending on how you frame the scope of the market. See Peter Thiel's book for a chapter on this. You could say that Apple has a monopoly over developers building apps and providing their services to people using iPhones. But is that the scope that is under regulation, or what constitutes the "marketplace"? Someone else looking at it could say that Spotify has a multitude of ways to provide its content to customers -- web, it's own Windows + Mac desktop apps, Android, etc. Would you claim that that is lacking competition? Which way is a regulator supposed to look at it?
• zaidf 8y ago
  Underneath the rhetoric, Spotify’s aim is to make more money off others’ work. Wow. It is astonishing to read this from a company being widely accused of an unfair 30% tax. Correction: the revenue share is 15%, it was originally 30%
  • chrischen 8y ago
    To be fair Apple capitulated and reduced it to 15% for after the first year, and leave a lot of money on the table from freemium/ad-supported apps. I'm honestly not sure what the big deal is. You can subscribe outside of the App store (by not using in-app payments) and not pay that extra $$, and Apple doesn't get that extra $$.
    • HeyZuess 8y ago
      > I'm honestly not sure what the big deal is. You can subscribe outside of the App store (by not using in-app payments) and not pay that extra $$, and Apple doesn't get that extra $$. It seems that Spotify claims that even making that information known on the app gets their app rejected. They have mentioned that Apple rejected their app because of the word 'Free' being used, as well as 'promotions' being used inside the app, and there is no way to link to external payment options. Enabling payments via the App Store is helpful, denying other forms of payments seems leaning towards being anti-competitve. Link for reference: https://www.timetoplayfair.com/ https://www.timetoplayfair.com/
      • chrischen 8y ago
        Ok, it's hard to tell because both sides are over-extending and exaggerating the issues. Asking Apple to change the 30% fee to 0, or some other arbitrary number is untenable. Blocking Apps from advertising that you can subscribe on their website outside of the Apple platform is weakly tenable. I can see the argument and reasoning that Apps should pay for "advertising" for the service through the Apple platform, but in reality "discovery" through the Apple platform is limited and in Spotify's case most people probably do not discover it through the platform. That being said, I can see the argument that 1) If Spotify users discover them through the App store, they would not know about subscribing directly through Spotify for a lower rate. Therefore Spotify should pay the 30% as user acquisition cost. 2) If Spotify users come to the App store from Spotify, they should already have signed up outside or know about the lower rate outside of the Apple platform. It seems to me the main reason why Spotify is against the 30% tax (aside from generally wanting to not pay), is that 1) Spotify wants to be able to upgrade free users to paid users in-app with the least amount of friction. They can do this by email, or through the App, but obviously it's much easier to do so through an in-app popup. I've had countless friends that have accidentally subscribed to in-app subscriptions so I know how easy it is to subscribe. 2) Spotify does not want to pay the lifetime 30%/15% tax on customers acquired through the App store.
• exwiki 8y ago
  > Spotify wouldn’t be the business they are today without the App Store ecosystem, but now they’re leveraging their scale to avoid contributing to maintaining that ecosystem for the next generation of app entrepreneurs. We think that’s wrong. I think that's a very hypothetical claim. > Let’s be clear about what that means. Apple connects Spotify to our users. We provide the platform by which users download and update their app. We share critical software development tools to support Spotify’s app building. And we built a secure payment system — no small undertaking — which allows users to have faith in in-app transactions. Spotify is asking to keep all those benefits while also retaining 100 percent of the revenue. I think we should be clear that Apple built the app-store ecosystem to improve its iPhone adoption and lock-in. And Spotify isn't asking to keep 100% of the revenue. Spotify is asking for a choice of letting users pay how they wish. The problem really is Apple wants to milk its App store ecosystem now that its popular and 30% / 15% is a very steep price / revenue loss for any significant player in that eco-system. And FWIW, Google provides a similar App store service, while also allowing users to what they choose with their phones (i.e., install side-loaded Apps).
  • zaidf 8y ago
    > Spotify wouldn’t be the business they are today without the App Store ecosystem, Apple makes Microsoft look like an angel. Using this argument, Microsoft could claim they could have made hundreds of billions if they got a cut out of every Windows app sale. Oh, and that those companies wouldn't exist if it weren't for Windows.
    • bad_user 8y ago
      Apple popularized trusted computing. And yes, it's as bad as we feared it would be back in the '90s.
      • nolok 8y ago
        Ehhh I feel like Unix/Linux popularized trusted computing, Apple merely added a price tag on it. But I may be blinded by my techie point of view about "popularized".
• segphault 8y ago
  > Underneath the rhetoric, Spotify’s aim is to make more money off others’ work. And it’s not just the App Store that they’re trying to squeeze — it’s also artists, musicians and songwriters. Uh, I seem to recall Apple being forced to reverse some brazenly greedy policies for their music service when a high-profile artist called them out and withheld content in protest. For Apple to characterize itself as a champion of exploited artists is pretty disingenuous.
  • chrischen 8y ago
    I think they may be specifically referring to the most recent royalties hike that was opposed by Amazon, Spotify, but supported by Apple. Was most likely a PR move to make Apple look like a supporter of artists.
    • epai 8y ago
      According to this infographic (linked below), it seems like Apple Music does give more average revenue per play than Spotify, $0.0060 for vs $0.0044. But in general, Apple Music isn’t _that_ much better than the rest where paying artists goes. It lags far below tidal, for example, which doles out $0.0125 per play on average. https://informationisbeautiful.net/visualizations/spotify-apple-music-tidal-music-streaming-services-royalty-rates-compared/ https://informationisbeautiful.net/visualizations/spotify-ap...
      • mehrdadn 8y ago
        Holy cow. So you have to play a song 227 times for the artist to make a dollar off the song? Any idea what it's like for just buying the song on Amazon?
        • dannyw 8y ago
          Artists or record labels get about 30 cents of a $0.99 song purchase I believe.
          • 8y ago
• infinity0 8y ago
  > What Spotify is demanding is something very different. 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. Please Apple, pay all the open source projects that you use, a fair share of the revenue you generate on top of them. Hypocrites.
  • ThemalSpan 8y ago
    I could not agree more.
  • thegayngler 8y ago
    Wow! Thats a new one. Pay the open source world who Apple have been heavy contributors to themselves. Apple are such hypocrites indeed.
    • deleted 8y ago
      [deleted]
    • infinity0 8y ago
      They contribute to specific open source projects with a long-term view to undercutting other open source projects that are more independent of Apple. That is far from being "nice" or "contributing back". Have you heard of "dumping"? What Apple does in its FOSS contributions is a similar thing - pour a ton of developer resources into critical FOSS projects so that they eventually control the development process and claim they are "contributing to open source", but in the end everyone that depends on these projects have to follow the direction that they set. LLVM/Clang is perhaps one exception, but even the Apple parts of that project's history have very obvious goals of undermining GCC since they hate the GPL's guts, counterbalanced by the legitimate need for a FOSS competitor to GCC that attracts enough non-Apple influence in the LLVM/Clang project to balance out the Apple influence.
      • thegayngler 8y ago
• est 8y ago
  Can anyone explain why Wechat, the app that can do everything, streaming paid music, read paid ebooks, order food and goods, play games, are allowed to charge directly without IAP? Heck wechat even had its own mini app store.
  • lozenge 8y ago
    Because apple needs wechat and not the other way around. WeChat being an essential feature for any Chinese customer.
    • est 8y ago
      so the AppStore policy is selective?
      • zenexer 8y ago
        Very much so.
      • nolok 8y ago
        Is this a real question (genuinely asking) ? Apple applying its policy differently for some apps, or chosing to re-interpret some of their policies randomly for some apps, is not an uncommon complaint and was a big part of spotify's original complaing.
        • kodablah 8y ago
          It's a real question because the linked statement explicitly states the same rules are applied to all apps. One who may not acknowledge the obvious falsehoods can be excused for assuming the same rules are applied to all when told that's the case.
        • deleted 8y ago
          [deleted]
      • luka-birsa 8y ago
        Shocker, I know!
• baxtr 8y ago
  Apple has created a massive platform with a large number of users over the last years. This has cost them a substantial amount of money and hard work. Why is not ok to monetize this Why is it ok to collect so many users on a platform that you end up as "unicorn" like Spotify without paying money for this acquisition channel? I don't get why Apple is viewed here as the "bad boy". You could argue the same with Google. Why do they take money for ads? Because they have the users. Same with the app store. Nobody forced Spotify to create an Apple app. It was THEIR strategy to grow on the Apple store.
  • kinkrtyavimoodh 8y ago
    > You could argue the same with Google. Why do they take money for ads? Because they have the users. That's a bizarre analogy. The analogy would be that Google not only takes money from PnG for showing you an ad for Head and Shoulders, but then charges forces PnG to sell you the shampoo through Google AND takes a 30% cut on the revenue.
    • baxtr 8y ago
      Well, only if google made the shampoo bottles and PNG provided the shampoo inside
      • WA 8y ago
        No, only if Google offered the shelf for the shampoo bottle to stand on.
        • TotoBOD 8y ago
          Precisely! AppStore is the shelf for Spotify...
          • rnotaro 8y ago
            Should we also be angry at Ebay, Etsy, Amazon for taking a cut of the sales too?
• sidcool 8y ago
  Corporations bickering out loud in public like neighbours. Quite a spectacle. Having read both Spotify's and Apple's claims, I am confused. Both seem legit.
  • saagarjha 8y ago
    > Having read both Spotify's and Apple's claims, I am confused. Both seem legit. Both sides are exaggerating: Spotify's claims that Apple is blocking their apps and preventing them from shipping features are likely bogus, while Apple's claims that they don't selectively implement rules when doing app review is false as well.
• maaaats 8y ago
  What an immature letter, did not really expect a response like that. It also fails to address the most important points from Spotify, which I thought were: you have no choice but to use the apple store, and promoting your own payment is not allowed. Fix one of those and most people would be happy.
  • leoh 8y ago
    That and the fact that they pay a shitload of money to Apple and Apple fucking won't allow Siri to work.
    • hello_friendos 8y ago
      I guess you didn't take the time to read the full response: When we reached out to Spotify about Siri and AirPlay 2 support on several occasions, they’ve told us they’re working on it, and we stand ready to help them where we can.
      • intellix 8y ago
        Are they saying that there's no Siri or AirPlay2 integration because the Spotify developers just didn't get around to it yet? Last I checked the documentation the capabilities of what you can get from Siri were extremely locked down to only a handful of usecases
• Grue3 8y ago
  Ctrl-F "Apple Music" 0 results So they won't even address the elephant in the room, the fact that their own service has preferential treatment?
  • dajonker 8y ago
    That's politics for you. Only address the issues that are favorable for you, ignore the rest.
• flocial 8y ago
  I can only imagine how Steve Jobs would have written this, the way he famously addressed Adobe pushing for flash on the iPhone [1]. 1. https://www.apple.com/hotnews/thoughts-on-flash/ https://www.apple.com/hotnews/thoughts-on-flash/
  • espressomachiat 8y ago
    >We know from painful experience that letting a third party layer of software come between the platform and the developer ultimately results in sub-standard apps and hinders the enhancement and progress of the platform. If developers grow dependent on third party development libraries and tools, they can only take advantage of platform enhancements if and when the third party chooses to adopt the new features. We cannot be at the mercy of a third party deciding if and when they will make our enhancements available to our developers.
• keiferski 8y ago
  I have noticed that the quality of writing at Apple has gone down dramatically since Jobs passed. It used to be concise and elegant. Now it’s some cross between a SAAS landing page and a passive-aggressive tweet. You can see this everywhere from Apple.com to this letter.
  • ndnxhs 8y ago
    The writing in this was very unexpected. Reads more like some devs rant post and not an official statement.
  • saagarjha 8y ago
    This letter is the exception, not the norm. I have never seen official statements from Apple this strong aside from the Bloomberg letter they published last last year.
• numair 8y ago
  > A significant portion of Spotify’s customers come through partnerships with mobile carriers. This generates no App Store contribution, but requires Spotify to pay a similar distribution fee to retailers and carriers. Everyone would benefit from seeing what both Apple and Spotify are paying to the carriers for these bundling deals.
  • dmitriid 8y ago
    Everyone would benefit from seeing what both pay the labels. Everyone speaks about “they only pay artists X per stream”. However, neither of them pays the artist directly.
    • hoffs 8y ago
      Well that's not really their problem is it, I'm sure independent artists that do have their music on Spotify do get paid 'x per stream'. That is the problem with the music industry and their label signing deals.
      • dmitriid 8y ago
        There are very few independent artists on Spotify that get paid directly by Spotify. The absolute vast majority (easily 99.9999% of artists) are signed up via the four major labels or (if they are independent artists) via aggregators: - Spotify only started signing up independent artists since 2017 or so [1] [2] - Even there Spotify recommends you upload music through aggregators or labels [3] (I'm not even sure if you can get there as an artists without going through a label or a distributor) > That is the problem with the music industry and their label signing deals. The music industry has no other options but sign deals with labels. Because the major labels control the catalog of music that people listen to. Almost anything even remotely popular you listen to belongs to them: from Taylor Swift to Beatles, from Drake to Iron Maiden, from One Direction to Pink Floyd etc. And the industry is too scared to say anything against the labels for fear of retribution. You go against Warner Music, they pull their content, and goodbye Slipknot, R.E.M., Skrillex, Red Hot Chilli Peppers, Muse, Ed Sheeran, Eric Clapton, Ghorillaz, ... [4] You go against Sony, and... etc. [1] https://en.wikipedia.org/wiki/Spotify#Spotify_for_Artists https://en.wikipedia.org/wiki/Spotify#Spotify_for_Artists [2] https://artists.spotify.com https://artists.spotify.com [3] https://artists.spotify.com/guide/your-music https://artists.spotify.com/guide/your-music [4] https://store.warnermusic.com/all-artists https://store.warnermusic.com/all-artists
• kristaps 8y ago
  Notably absent: addressing the point that Apple's own streaming music offering has an unfair 30% price (or profit) advantage over any other service that chooses to use in-app payments.
• jen729w 8y ago
  Ben Thompson to the white courtesy phone. Ben Thompson. Thank you.
• abalone 8y ago
  Apple’s essential claims: 1. 15-30% is a fair “contribution to maintaining the App Store ecosystem” which has led to Spotify’s “dramatic growth.” 2. Spotify is greedy and bad, just look at how they squeeze artists, unlike us. The second point is really weak considering that paying such a high fee to Apple, which Apple Music itself doesn’t have to pay, might force Spotify to take it out of the artists’ end to stay afloat. And as to the first point, Apple makes it sound like the App Store was the reason for Spotify’s success, so it’s only fair they take a healthy cut. But there’s no other choice on iOS. It’s not clear if discovery in the App Store was essential to Spotify’s growth or if it was just the only way to install software on iPhones. One need only look at macOS to determine how important the App Store is to discovery and growth. Many, perhaps most developers bypass it.
  • bunnycorn 8y ago
    Spotify isn't paying ANY fee to Apple. Spotify is a free App and there are no IAPs. All costumers that use Spotify in Apple devices have to pay through the WWW, carriers, gift cards, etc. Spotify is a piece of shit that wants to use Apple's network for free. Because they know people trust Apple with their CCs more than them.
  • ninkendo 8y ago
    > paying such a high fee to Apple, which Apple Music itself doesn’t have to pay, might force Spotify to take it out of the artists’ end to stay afloat. bunnycom's reply to you is flagged dead, but there's an important rebuke to that claim: Spotify doesn't use iAP for subscriptions any more, and Apple gets no money off of Spotify today except for pre-existing subscriptions from before Spotify disabled iAP: https://support.spotify.com/us/account_payment_help/subscription_information/spotify-through-the-app-store/ https://support.spotify.com/us/account_payment_help/subscrip... So I think it's a bit specious to say Spotify has to squeeze artists more to pay Apple's fees, when they're not even paying those fees any more. And I'd venture to say the iAP process really does help growth of apps like Spotify: it lets you use a single credit card you have linked to your iTunes account for all in-app purchases with just TouchID/FaceID, and is a much lower-friction way of paying money to an app than filling in your credit card information into every app, having to change them all when your card expires, etc. I wouldn't say it's worth a 30% (or even 15%) cut, but it's not worthless.
• fanpuns 8y ago
  Though I think there are parts of this letter that are obviously self serving and hypocritical the point I find more problematic actually has nothing to do with Spotify. Apple says most apps contribute nothing to the app store. This is false. To list an app on the app store developers must pay, yearly, for the privilege. This is important because a reasonable person could make the argument that _this_ is a more fair model and one more in line with providing the actual service of the app store. Apple,rightly IMO, has accused Spotify if wanting to have it's cake and eat it too, but charging a fee to list and taking a percentage of revenue could easily be seen as the same.
• ac29 8y ago
  This argument is super thin -- they seem to think that Spotify enjoys a huge advantage to being available on their platform (they do), without acknowledging that they also enjoy a huge advantage from the most popular music streaming app being available on their platform (which is also true). Apple still makes most of its money on hardware, and having popular apps is absolutely vital to selling hardware.
  • bunnycorn 8y ago
    Why? Apple has Apple Music, has more music than Spotify and even if there is a track on Spotify and not in Apple Music, you can upload your own MP3s and stream them. I have a gigantic collection of Soundtracks and indie music there.
    • tikkabhuna 8y ago
      If Spotify wasn't on iOS I would move back to Android in an instant. I don't like Apple services because I don't want vendor lock in. I use Spotify because they're independent and support a large number of devices. This is just like how I use Sonos because they're independent and support a large number of services. Apple benefits greatly from having high quality, third party applications on iOS. Wasn't the lack of third party apps/support one of the big issues with Windows Phone?
      • bunnycorn 8y ago
        Lots of people said that when a popular local carrier changed from free Spotify to free Apple Music on one of its plans. Everybody switched to Apple Music. Windows Phone failed primarily because it didn't offer anything that Android or iOS couldn't offer.
    • epanchin 8y ago
      Like many people, I use spotify for music discovery. I don’t feel Apple Music can offer the same quality of recommended tracks for me/moods.
• paxy 8y ago
  Apple is also being misleading about the 30%/15% fee variance. They make it seem like Spotify's fees drop to 15% after it has been in the App Store for a year. In reality, it is only 15% if a user is renewing their annual subscription. For initial purchase of annual subscriptions or initial purchase+renewal of all other subscription durations the fee is still 30% indefinitely. And I'm willing to bet that the vast majority of users pay monthly rather than annually.
  • xuki 8y ago
    Doesn't matter if it's annually or monthly or weekly, once you pass the 1-year-mark it's 15%: https://developer.apple.com/app-store/subscriptions/#revenue-after-one-year https://developer.apple.com/app-store/subscriptions/#revenue...
• jillesvangurp 8y ago
  This sidesteps a few of the issues, which include that Spotify like others in the app store is at the mercy of Apple interpreting its own rules when deciding to block updates. Then there's the notion that Apple is competing with its own customers in the appstore. And when it comes to Spotify, Apple Music is a direct competitor but I doubt they charge them 30% of revenue. They have a huge conflict of interest. Pretending that they are even remotely neutral is ludicrous. They block competing browser technologies; technology stacks not favorable to them; content they don't like; business models they don't like; etc. And then the infamous Apple tax is of course very lucrative for Apple. Calling others greedy while charging this much while actively competing against them is simply arrogant. Spotify has delivered lots of revenue to Apple over the years. It seems Apple feels entitled to a huge chunk of this revenue and to the privilege of unfairly competing with them at the same time. This company (and others like it, cough Amazon) deserve to be scrutinized for their anti competitive practices.
• paxy 8y ago
  Funny that they didn't mention Apple Music even once in their statement, which is what a major part of the complaint is about. Overall I'm shocked by the level of hubris coming from Apple. The app store is a mutually beneficial ecosystem for all parties, but they make it sound like they are doing the world a huge favor by running it.
• chj 8y ago
  > 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 Wow, Apple's response is rather arrogant. Apple seems to forget that without apps like Spotify, and those it said "contribute nothing to the app store", app store won't grow to what it is today. I am pretty sure that Spotify is willing to distribute outside AppStore if you give it a choice.
  • IshKebab 8y ago
    Also they contribute $100/year.
• scoutt 8y ago
  It's a symbiotic relationship, but if it reduces to "which came first, the chicken or the egg?" analogy it would be: * the app store is successful thanks to apps like Spotify * Spotify is successful thanks to the app store I think the second premise tends to be more accurate to the case. If I make the most used app in the world today, I cannot take credit for pumping the success of the app store, because it was already there when I launched my app. In either case, it's Apple yard, they set the rules and charge what they want. Don't place your main source of income in another person's yard.
  • chj 8y ago
    > In either case, it's Apple yard, they set the rules and charge what they want. Don't place your main source of income in another person's yard. It's too late. Had people known it would become what it is today, nobody in their right mind would build apps for it. Not me at least.
• johanneskanybal 8y ago
  The app store is shoved down my throat unless I jailbreak my Iphone NOT a value add. I'd have ten times more apps on my phone without it. They'll lose this legal battle.
  • deleted 8y ago
    [deleted]
• kodablah 8y ago
  > The only time we have requested adjustments is when Spotify has tried to sidestep the same rules that every other app follows. So Spotify complains that the rules are draconian and the response is that everyone has to follow them? If anything, it requires getting to a certain size to have your complaints addressed like this, even if they are hand waved away as consistently applied.
• dingo_bat 8y ago
  All of this bs is happening due to one thing: apple does not allow iphone to function as a general purpose computer. Fix that, and everything will sort itself out.
• headmelted 8y ago
  To be fair, it does look like Spotify has clearly been selective with the facts in it's original post. Ok. None of this response addresses the main question raised by the Spotify letter which is: "Is Apple abusing it's position as platform holder to grow it's own products over it's competitors?". Their silence on this, the core issue, speaks volumes. No doubt a lot of people reading Apple's letter (and many in the media) will be taken in by the empty rhetoric around helping musicians and forget that the main story is about Apple's ability to monopolize media through the iPhone, and whether it has attempted to do so. As far as this story goes I could not care less about Apple or Spotify (and I'm a customer of both). I care about whether laws are being broken that exist to protect me from price gouging in the future.
• chewz 8y ago
  Hey Apple, if not for Spotify we would still had to cope with iTunes..
• waterishail 8y ago
  Nice side stepping there on apple music not paying fees to apple store and advertising from within the app as well as offering in app subscriptions and tighter integration with other apple services that outside developers do not have.
• mgoetzke 8y ago
  What about the fact that Apple Music does not compete fairly ? They provide music services like Spotify, if they where a different company they would have to pay and play by the same rules. They do not or do they ? I have no trouble with free apps by the OS developer. But once you have to pay they must compete with alternatives.
• emsy 8y ago
  I've mentioned this in a reply but I think it's worth pointing out as its own comment to gather thoughts on this: What if Microsoft would take 30% of every transaction that is done via Windows? And if the sellers don't comply they gets kicked off the platform. That's essentially what Apple is doing, but I'm pretty sure if Microsoft was the one doing it the would be far fewer apologists. In fact, I very much think Microsofts business model, that is decades old, is far better for customers and developers, and helped Microsoft become so successful in the first place. Microsoft provides a platform for others to make money on. The profit their customers make on Windows exceeds Microsoft's by an inestimable factor. I'm not aware that MS ever provided a case for regulation on that basis, and I think that's worth pointing out. If your company controls a platform that affects a sizeable part of the population, it should not be able to act on their whim. And if the company doesn't play fair it needs to be regulated.
  • wodenokoto 8y ago
    These are very good points. My loosely connected thoughts on this: We originally accepted this from Apple, because we didn't consider phones as "real" computing devices. Apple would get in a lot of trouble, with no apologist left to defend them, if they turned MacOS into an app-store-only platform. I feel like the major benefit of app-store for consumers is the curation of "good actors". What would be the consequences of adware if the protected app stores were let loose? On one hand I fear it would go completely off the rails, on the other hand it is already worse today on mobile apps than on PC/mac-apps, so can it really get worse? Would better access to opensource apps help alleviate the adware problem?
  • loceng 8y ago
    I'd rather analysis includes looking in the opposite direction to understand the pros and cons of each business model: what would Microsoft ecosystem look safety and security wise on PCs if they took 30% to have additional resources to review applications for malicious behaviour, and so on? Fundamentality Apple decided on the 30% model for arguably good reasons. People are free to purchase other non-Apple laptops and products that use other operating systems. If it was a case where patents or other only allowed for one option, then yes, that's the case for rules to break that monopoly. And yes, I understand network effects and sunk costs of consumers, however if the value continues to be there for consumers then they will continue to use the ecosystem. If a company selling a premium Calendar app doesn't think 30% cut is fair then they don't have to build an iOS app, and then likely some other company who thinks it is fair will very likely fill in that gap - if not, then the marketplace wouldn't work. And it's true there's a lot of work to be done if you want to compete with Apple wholly with lesser or no revenue share you need to create the same or better ecosystem as them - perhaps the main differentiation being a lower or no fee for your version of the App Store. Finally you could argue Apple have enough profit from elsewhere to cover the benefit the App Store provides, however they're not setup as a co-operative to distribute costs and/or make as little profit as possible - though that certainly is an interesting option for a competitive business model, whether there's an appetite from consumers to pay into such a scheme or a path there is another question.
• skinnyasianboi 8y ago
  > Spotify wouldn’t be the business they are today without the App Store ecosystem Is that true? I remember me, my friends and family all had the spotify deskop app way before installing it on mobile.
• dgregd 8y ago
  > Spotify seeks to keep all the benefits of the App Store ecosystem How about ISPs? Maybe they also should get 30% commission from all music downloaded through their networks? After reading Steve Job biography I read now the Jony Ive book. And I must say that the current Apple has no taste. Taste in terms of whole product function and coolness. It looks like industrial product designers and greedy people took over the company. Do they really have to squeeze each dollar from customers and app developers and destroy their magic brand? How they are now different from Exxon Mobil or Louis Vuitton?
• life_of_sigh 8y ago
  From apples blog "And developers, from first-time engineers to larger companies, can rest assured that everyone is playing by the same set of rules." This is the key issue spotify has, Apple music is not playing by the same rules, in fact their monopoly on the app store its undermining Spotifies fair competition. Its undermining it becuase Apple Music a direct competitor of Spotify effectivly doesnt pay the 30% Apple tax which makes it hugely cheaper. If Spotify dodge the tax to make it able to compete on price, then Apple then abuse the monopoly it has on the store to prevent Spotify from advertising a premium option, it prevents them from offering or completeing the upgrade, it prevents them from linking to a landing page to describe Spotify business model, it prevents them fron doing anything or Apple will pull the app off the store. The only way Spotify could "compete" if it takes the 30% on the chin, dramatically reduce its profits and investment it can make compared to Apple Music and it will be bullied down. There are other arguments here to with Apple slapping restrictions on Spotify, not allowing for years to release an Apple Watch app etc but they are grey.
  • xvector 8y ago
    > Its undermining it becuase Apple Music a direct competitor of Spotify effectivly doesnt pay the 30% Apple tax which makes it hugely cheaper. ...as is the case with every native app? Notes doesn't have to pay the same tax as paid notes apps, for example. The only solution here to establish "fairness" as you want it is to abolish any marketplace fees entirely, and that's pretty nonsensical, given that 15%/30% isn't a bad fee as far as middlemen go. > prevents them from linking to a landing page to describe Spotify business model, it prevents them fron doing anything or Apple will pull the app off the store. And so every single app would simply link to an external payment system. The App Store would cease to generate any meaningful revenue. Apps would freeload off of an expensive and involved review process, reaping all of their benefits, while not contributing back to the service or platform which allows them to exist in the first place.
    • tasubotadas 8y ago
      > while not contributing back to the service or platform which allows them to exist in the first place. If that's such an unbearable burden, they are free to close it down. I am pretty sure that in no time we would see GetJar-like stores popping up.
• Khanhanhan 8y ago
  Not taking sides with Apple or Spotify here. Both are interested in their margins far more than the benefits of their clients which is understandable. However, it's strange how many devs are complaining about App Store considering that without it many/some of them wouldn't make a dime from their apps. Apple aggregated credit cards of people who don't shy away from using them and made sure that those people get value.
• pvinis 8y ago
  Why is this public and they don't handle it directly between the two companies? Not with posts, not with AppStore review feedback. Send some people that can talk and solve this? This kind of thing is so weird for me when companies do that
• pelasaco 8y ago
  Actually the main point, which will probably make Spotify win the cause in Europe, is that the Apple music app, which is direct concurrent from Spotify, does not have to comply with the same rules. So for me, if this claim is true, then Apple will be in trouble.
• jbverschoor 8y ago
  This whole discussion comes from spotify losing users, and Apple gaining so much. I switched from spotify -> Apple music because: 1) I can store my own music in icloud and play them on my devices 2) Better content and includes videos 3) "Radio"
• kutoff 8y ago
  What I actually heard reading that closing statement... We’re proud of the work we’ve done to force companies like Spotify into a walled garden, restricting hundreds of millions of paying customers purchasing choices, and we wish them continued success — after all, the whole point of creating the App Store was to sell more iPhones so rent-seeking off the app-developers that made us so successful is just an added bonus.
• mcqueenjordan 8y ago
  How the heck did this get thru a PR vetting?
• SalimoS 8y ago
  The 30% cut for the App Store is logical after reading this PR It’s like the free tier in Spotify A free tier that access the stream and the premium pay for more features and that money cover the whole system the Apple premium feature is the payement system that’s used by developers to collect payment It’s like Spotify don’t want to pay stripe or PayPal for using their payment solution
• roguesherlock 8y ago
  This looks so unlike Apple. Almost childish.
• throwaway28616 8y ago
  Having dealt with Apple, this letter exposes the infuriating position I sense they have. I believe they feel entitled to do whatever they want on iOS because they created it. That they have first dibs on any product or service on the platform, and that if they allow you on the platform you should reward them through money (dev fees and revenue cuts) for the privilege they are extending to you on top of the product you paid for (not unlike ISPs who wanted to charge Netflix in addition to their customers). And they don’t particularly care about the impact to their users because they feel their users should be grateful for the UX and quality of their hardware/OS. They’ve told us we should be thankful for the customers they bring to us as a developer. It reminds me of rich people who feel like they earned everything they have themselves and don’t realize they depend on the people and ecosystem they exist in. It’s arrogant and infuriating. Apple somehow seems to have consistently acted this way for decades. And they seem to undervalue the body of software iOS is built on top of and the ecosystem of apps that makes their platform sticky. They’ve always pushed their own, often walled garden, solutions. And it was annoying but their prerogative... until they gained market manipulating power on the computing platform of the decade.
• C4stor 8y ago
  It's nice to see Apple admitting that they have for a long time, and for the detriment of everyone, fused two very distincts roles. The first is distributing software, and the second is processing payments. Incredibly, the first is free for everyone, even if you distribute billions of copies of your app, which doesn't make any sense in a vacuum. But they allowed themselves to become the only payment processor available on their hardware, while there are a ton of options in the wild, and this payment processor takes a 30% cut. This is roughly ten times what Stripe charges for the exact same service ! If Apple really wanted to allow a fair competition on their hardware, they would provide these two services independently, and allow competition on the payment processing part. It would mean start charging for app distribution, but that would only make sense anyway, since they endure a cost (however low) on every download. But of course, it's not what they want (nor what google wants with the App Store). They want to have a monopoly on payment processing, because that's where you can extract as much money as you want. Which leads to these ubuesque situations where greedy corps #1 fight with greedy corp #2, and in the end, it's the customers that are losing anyway due to jacked up prices on non competing-services. And people saying that there is the option to switch to Android, well...it's the same payment processing fee ! It's really a wonder none of those two giants are competing on that point to attract developers...
  • mrunkel 8y ago
    The 30% is for distribution, payment processing (including refunds) and first line customer support, in both directions. It also includes vetting all app submissions for users. I would wager that neither Google nor Apple cares about the developers directly. Indirectly they want to make it possible for developers to reach their (Apple's) customers because it's good for the customer. However, the developer pays apple $99/yr, the customers a great deal more. I still see the app store as a great thing for customers and developers. And again, if you don't want to pay apple anything, release your app for free and have your customers login to the app after they buy it somewhere else. But if you want to leverage the app store's reach, you need to pay Apple their share.
    • C4stor 8y ago
      That's exactly my point : 30% for everything makes 0 sense ! 1. Distribution shouldn't be indexed on the price of what you're distributing. Distribution costs are mostly flat. They could be charging a per MB cost of download, plus a flat cost for app curation for example, it would make sense. 2. 30% for payment processing is ten times what it needs to be. 3. Same as 1., customer support costs doesn't depend on the app revenue, they should be charged independently of that it Apple played fair. $99 a year is a laughably small amount to pay for big editors, it doesn't even cover bandwidth costs of distributing data. The only point is preventing the app store being literally flooded by low quality apps. So yes, to leverage the App Store reach, I should pay the App Store something. And that something should nothing at all to do with what my own customers are paying me, which the App Store shouldn't even know to begin with.
• aboutruby 8y ago
  > 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. Kind of weird to see Apple attacking another company. Also Spotify main claim seems to be about their podcast acquisitions and Apple didn't answer that: > So we announce two podcast acquisitions we are super excited about, and all of a sudden Apple arbitrarily decides to prohibit use of its API to recommend podcasts to users https://timetoplayfair.com/timeline/ https://timetoplayfair.com/timeline/
• xpuente 8y ago
  The fear of being forced by the EU to allow app sideloads.
• rkangel 8y ago
  This is an interesting result of the collision of device sales, and a digital distribution channel. The normal free market economic push back against Apple on this would go something like: * Apple charges too much * It's not worth it for apps to be in the App Store * App Store selection drops * Consumers stop buying iPhones In practice though, Apple has such a foothold, and device purchase is so separate from App purchase, that most apps don't see a choice about being in the AppStore. Does that mean that Apple has a monopoly on iOS app distribution, and so should be regulated using anti-trust? As an aside, the anti-trust section in this Money Stuff article is really interest: https://www.bloomberg.com/opinion/articles/2019-02-28/bank-sells-votes-on-another-bank https://www.bloomberg.com/opinion/articles/2019-02-28/bank-s...
  • doppel 8y ago
    As Apple says in the article, they put quite a few resources into making the whole App store platform, including in-app payments. The issue is that there is no opt-out for the end user - you cannot use a different app store to install applications for your phone, and jailbreaking is getting harder while at the same time border-line illegal in some jurisdictions, not to mention being quite technically challenging. Imagine buying a car sold by a gas station chain saying "We made the BEST gas stations you can imagine, but you can ONLY buy gas here. It's a fair marketplace, everyone who wants to sell gas at our stations can do so equally, and we'll take the same cut from everyone!".
  • bradleyjg 8y ago
    I think iOS app distribution is a bit too narrowly drawn a market. What if Apple had 5% of the smartphone market, they'd still have 100% of the iOS app distribution market. No, I'd say the right word here isn't monopoly, but rather duopoly. That doesn't mean that antitrust law shouldn't apply, duopoly is definitely not the same thing as a fully competitive market.
    • devit 8y ago
      Apple has a monopoly on selling phone apps to the percentage of smartphone users that have an iPhone in their pocket. It should thus be regarded as a monopoly regardless of how many people are affected, and forbidden.
• rightnow 8y ago
  Pathetic that Apple is trying to look like a hero, and trash talking Spotify that they are some kind of evil artist killers.
• z3t4 8y ago
  Just let me download the mp3 and play it on whatever device I choose. First I need a iPhone $1000, then I need a Internet service with enought data to stream HQ audio $50 /month. Then I need a (Spotify or other) subscription $30 /month. Why not let me buy the songs/albums from some web page/app !?
• jacquesm 8y ago
  There's this poem about big fleas having smaller fleas. Clearly Apple is about as hypocritical as they come for calling out Spotify wanting to 'make money off others' work' because they themselves do just that, and not just of Spotify, but also of every artist in the Apple music department and of course of all the App developers. It's a pity that nobody has been able to come up with a direct-to-consumer model for music that worked.
  • SirensOfTitan 8y ago
    I just came across this yesterday in a book I’m reading. Such a fun coincidence: So, naturalists observe, a flea Has smaller Fleas that on him prey; And these have smaller still to bite ‘em, And so proceed ad infinitum. Jonathan Swift
• codesternews 8y ago
  Whatever you say I think we should see from apple prespective also. "Let’s be clear about what that means. Apple connects Spotify to our users. We provide the platform by which users download and update their app. We share critical software development tools to support Spotify’s app building. And we built a secure payment system — no small undertaking — which allows users to have faith in in-app transactions. Spotify is asking to keep all those benefits while also retaining 100 percent of the revenue."
• GiorgioG 8y ago
  I'd like Apple to stop pretending that it's still 2010 and that their services provide the best experience for their customers. In a connected world, Apple still wants to keep other major players out. I have Spotify, SmartThings/Google/Amazon devices and in every single case, Apple makes them a second class citizen by restricting private APIs, or has been very late to integrate with them. It makes it hard to justify another MacBook Pro / iPhone purchase going forward.
• apandhi 8y ago
  As an app developer, I wouldn't care about the 30% cut if apple's In-App Purchase SDK was up to par with other payment processors. For example - as a developer I can't cancel subscriptions on a user's behalf, even if they've requested us to cancel it multiple times, nor can I refund a user's subscription, give them discounts/free months for their troubles/etc. The thing is, when a user reaches out to Apple to request a refund (since we can't do it on their behalf), and Apple denies the refund, we get the bad review. On top of all of that, Apple does not pay out their developers until 30 days after the end of the month. That means that we can be waiting for 60(!) days before we receive revenue from an active, paid, subscription. They don't even let us know how much we will get paid for the month until a week before payments are dispatched.
  • madeofpalk 8y ago
    > Apple does not pay out their developers until 30 days after the end of the month 30 days payment terms is fairly standard, no? I usually don't get paid until 20 days after I issue an invoice.
    • apandhi 8y ago
      30 days would be fine - but since it’s 30 days after the end of the month, it ends up being more along the lines of 45-60 days after the user has been actively using the service (and thus costing us money).
• dadoge 8y ago
  Lot of comments here refer to the 30% fee in isolation. Where Apple is especially unfair in allowing others to compete is that it too has a music service and in the past was able to charge users lower than what any competitor would charge for a music streaming subscription. So it’s the combination of 30% fee and making apps where it itself doesn’t “charge itself” 30%
• revel 8y ago
  I love how brazen this letter is. > Apple’s approach has always been to grow the pie. Apple's approach has always been to grow it's own pie. They have never been even remotely interested in playing nicely with other companies. I don't fault them for it, but let's not kid ourselves here; the app store is largely an extremely profitable exercise in rent seeking. It's not like this is new for Apple; they've had proprietary cables and adapters for as long as I can remember. Developing software for their hardware has always meant using Xcode, which, surprise, is not free. Literally every other platform has given away tooling and emulators, but that's never been true for Apple. Occasionally this kind of behavior works out well for customers -- they were unafraid to use their market power as a cudgel to kill off Flash (which I think we can all agree needed to happen) -- but all too frequently it's purely anti-competitive. Apple has created some incredible products and services over the years, but let's not kid ourselves about this; this is simply a way of extracting value from Spotify.
  • cnorthwood 8y ago
    Xcode is now free: https://itunes.apple.com/gb/app/xcode/id497799835?mt=12 https://itunes.apple.com/gb/app/xcode/id497799835?mt=12 (although you still have to have a mac)
    • mattl 8y ago
      Still proprietary though, right? With underlying free libraries and compilers?
      • cnorthwood 8y ago
        Yes, it's gratis, not libre. I understood the parent comment to be referring to the price.
        • mattl 8y ago
          I understood it the other way. Proprietary cables to free tools. ️
• latexr 8y ago
  > Apps that are free to you aren’t charged by Apple. To publish apps on the App Store you need to cough up 99USD/year[1]. So even if an app is free to consumers, Apple is charging to make it available. [1]: https://developer.apple.com/programs/how-it-works/ https://developer.apple.com/programs/how-it-works/
• T3RMINATED 8y ago
  MIC DROPPPPPPPPPPPPPPPPPP
• mohsen1 8y ago
  I hope all of this results into Spotify Apple Watch that can stream music. I go for runs and even though my Watch has cellular and I pay the monthly fees I have to listen to podcasts instead of music I thought about making a little automated system where it exposes my playlists as podcast stations. Like an AWS Lambda that runs Chrome headless and streams the output of Spotify web player.
• skc 8y ago
  Ehh, just a minor spat in the end. At the end of the day, almost literally everyone at Spotify fawns over Apple and Apple gear. And that's a problem. If these companies are now finding out to their detriment just how precarious their existence is based on their dependence on Apple, then it might be a good idea to start championing multiple competing platforms instead of scoffing at any non-Apple related efforts.
• supernova87a 8y ago
  As with so many matters that involve money, arguments fly around left and right that claim to be on principle, but really aren't. When you see ESPN and Comcast argue over showing the World Series, don't buy the argument that one of them is "trying to prevent loyal customers from being able to see their favorite game", or when your local hospital group withdraws from your employer health plan that "the other side is trying to deprive you of consumer choice". Each side is wanting to make a share of the money, and they're disagreeing over the price (or often the royalties share). No one is entitled to any particular provision of service in any of these cases. Except in regulated industries there's no law governing the "fair" share that someone has to offer, or someone has to accept. And in most cases, each side could choose to compromise what it's asking for with no damage to its model of business (not talking about $, just the principles they claim). Spotify wants a lower $ charge. Apple owns the platform and controls that access and $ charge. That's it. This is a private contract dispute and only of interest because you care about listening to music. There's no public right to have a music app be charged a certain amount that's called "fair". Spotify could charge nothing to consumers, and be charged nothing by Apple. It's their choice. It's Apple's choice. Don't be fooled into "principles" when there's money involved.
  • unethical_ban 8y ago
    I agree with your point, but don't underestimate the power of public opinion, or the public wallet. I tend to think Apple is shitty in this instance, and I advocate all people use hardware-neutral services when possible. I stand with Spotify - that is, until they do something wildly anti-consumer or break their app.
    • supernova87a 8y ago
      I agree that public opinion is important, because it's usually what guides public policy. But I would just caution people to consider whether your stance is truly based on what you think should apply generally, or just because you like the person/party in the specific case. (applies to a lot of things in life) The power of platform providers versus app providers ebbs and flows back and forth with new technology, depending on who has the most market / customer pull. And you should try to deconfuse your principles about who should be able to charge what, from your liking of the provider -- because that can change in an instant. Craigslist charges employers a significant fee to post their job listings. Employers have far less sway than Spotify does in that platform dispute. I'm guessing you (audience) like Craigslist, and support them in what they charge? Why? Amazon charges companies to sell on their platform. You probably don't complain a lot about that, and that's probably just as restrictive as Apple+Spotify for some sellers. Why? Is it because you like Amazon's services? Or you maybe like Grubhub, and don't care that it takes a huge cut from restaurant owners. (a cut that is more painful than what Spotify charges per month, to the restaurant on every single order you make) I don't choose sides either way. What is "reasonable" is what the parties had the clout and market pull to agree to, and what the law says is acceptable in form. Separate your principles from your preferences.
• wand3r 8y ago
  It’s kind of a funny parrallel between this and the Qualcomm suits. How much rent can one company extract before the market adapts. E.g clearing subscriptions outside Apples channels, denying fees through major partners to Qualcomm.
• pwaivers 8y ago
  > "We found Spotify’s claims about Apple Watch especially surprising. When Spotify submitted their Apple Watch app in September 2018, we reviewed and approved it with the same process and speed with which we would any other app. In fact, the Spotify Watch app is currently the No. 1 app in the Watch Music category." A) I don't see it on the watch store, and B) that is a long time to finally get on the watch store!
• benologist 8y ago
  Surprised Apple didn't point to this gem from their history to justify doing whatever they want: "If you run to the press and trash us, it never helps." https://web.archive.org/web/20141226094343/https://developer.apple.com/app-store/review/guidelines/ https://web.archive.org/web/20141226094343/https://developer... I think action against Apple is long overdue, Android shows multiple app stores doesn't compromise security while Apple's corporate program was compromised to provide malicious ones! https://techcrunch.com/2019/02/12/apple-porn-gambling-apps/ https://techcrunch.com/2019/02/12/apple-porn-gambling-apps/ Apple recently rejected Steam's over-the-internet streaming client for iOS because they view it as a competing app store, it's getting a little bit too stupid. https://liliputing.com/2019/03/valves-steam-link-anywhere-lets-you-stream-games-from-any-pc-over-any-fast-network.html https://liliputing.com/2019/03/valves-steam-link-anywhere-le...
• xxxmaster 8y ago
  Couldn't agree more. It's Apple's world, if you are asked to play in a certain way - play it. Build your own ecosystem if you are not happy there. It's like everything in life, if you are not happy with something you have to find a way to make the change, don't Q_Q
• Mikeb85 8y ago
  Forgetting specific claims about money and app store revenue cuts, Apple could be in for some serious trouble in Europe, as the European Commission is far more pro-consumer than the relevant authorities in the US. Where they'll get into trouble is the fact that Apple Music uses APIs that aren't available to other developers, that they restrict developers from redirecting to their website from within the app, all while having a competing product. It's not the competing product that's an issue, nor the app store cut, but the fact that they're giving themselves an unfair advantage. The EC has already punished Google for similar, I don't see how Apple escapes unscathed.
• seandoe 8y ago
  They don't charge Spotify if users sign up on the web and then use the iOS client app right? Could Spotify just add a surcharge if users pay through the iOS app?
• Shalle135 8y ago
  But… they failed to adress the reason to why it took 3 years for Spotify to successfully get their Apple Watch app approved?
• ghego1 8y ago
  To think that in the response letter from Apple one could find anything but reasonable statements would be very naive. That letter has been drafted/reviewed by high skilled lawyers and, as much as one does or does not agree with the points they make, it still makes some clearly outlined arguments. So what I find most interesting is what it's not there. They do not mention once the fact that their own streaming app can compete on better terms since they do not have to give away 30-15% of the subscriptions.
• caprese 8y ago
  > As Spotify points out, that revenue share is 30 percent for the first year of an annual subscription — but they left out that it drops to 15 percent in the years after. okay wake me up when it is more like 5 or 6% This whole back and forth is so petty > Underneath the rhetoric, Spotify’s aim is to make more money off others’ work. My sides! > Just this week, Spotify sued music creators after a decision by the US Copyright Royalty Board required Spotify to increase its royalty payments. This isn’t just wrong, it represents a real, meaningful and damaging step backwards for the music industry. AHAHAHA In most cold wars, it turns out later that both sides have valid claims, they are just unrelated to each other and lobbing those claims as rebuttals never address the underlying issue.
• jarjoura 8y ago
  Wow, this is like a relationship where one partner tries hard to convey frustration and the other one not hearing any frustration at all but ends up making them about themselves. At first I just felt Spotify was being a little dramatic, like mom and dad fighting, but Apple's response is infuriating. I actually feel really bad for Spotify now. Yes they're a business, but the things Apple is accusing them of is the very thing Apple also does.
• AngeloAnolin 8y ago
  I like the fact that apple published the contacts for further inquiries related to this debacle (found on the bottom of the article). Their openness and transparency in providing these information deserves an applause.
• unstatusthequo 8y ago
  Would be super fun if Apple removed Spotify from the App Store. The ensuing drama would be really entertaining.
• Rudism 8y ago
  Has Apple ever tried to defend their rule that apps can't link to or even inform users of the existence of off-site registration or payment methods? That has always seemed like the most absurd thing to me and the most blatant example of Apple's true intentions with their app store.
  • daveidol 8y ago
    Exactly - they never address this issue head on
• dugluak 8y ago
  Does Microsoft get a cut from Spotify for hosting their app on Windows operating system? Just asking ...
• tw1010 8y ago
  Let me just throw out a guess here that stratechery will totally be on Apples side on this. They seem to have a bias against non-US companies stretching a long way back.
• djanogo 8y ago
  XCode is not free, the price is included in the Mac purchase. I can't do ANY iOS development without first paying for Apple hardware. iPhone is owned by user. If App Store is a profit center for Apple, then all their claims of "for the good of platform" are invalid. If it's not a profit center then I guess they can come up with whatever revenue model to socialize the cost. Apple Pay is different product, that discussion should be separate. I am a conservative, but agree with Sen Warren, >$25B companies need to be severely restricted on how they spread into other products. It might lead to over valuing smaller companies as investors would have to constantly look for new opportunities.
• zedkrevas 8y ago
  I'm quite interested in all this, because I feel they have significant impact on the future of these tech giants. Just as Google has been battling anti-trust suits for some time, it seems like it's time for Apple to face the music. From Apple's reply to Spotify, I notice that they haven't made a single valid counterpoint to Spotify's primary claim, which is that Apple is favouring their own Apple Music service on the App Store and the Apple Watch, while applying different rules for their competitors. In fact, it's quite disconcerting to see Apple engage in this petty whataboutery, when they mentioned that Spotify don't pay the musicians well: this point has nothing whatsoever to do with this anti-trust case. It's quite okay for Spotify to be horrible to the musicians and still want to be treated fairly by Apple. I personally am on Spotify's side in this case and I hope cases like these prevent these tech giants from brazenly stomping over rivals as and when they see fit.
• mychael 8y ago
  > avoid contributing to maintaining that ecosystem for the next generation of app entrepreneurs This is an insult to anyone with a brain. Calling fees "contributions" as if they "maintain" anything beyond increasing shareholder value. Don't be fooled by Apple's warm and fuzzy messaging.
• graeme 8y ago
  I think part of the problem here is that Apple's 30% fee is clearly aimed at digital goods for which the marginal sale has approximately no costs. Most digital goods are quite scaleable, and have enormous marginal per unit. However, Spotify is not at all like that. Neither is Kindle, neither is Netflix. So a system that is somewhat justifiable for software is simply insane for digital goods which do have marginal costs to sell. This is not necessarily simply to resolve. Witness, for example, the troubles with corporate taxation, and EU proposals for a digital tax on gross revenues rather than net revenues. This is basically aimed at the same sort of problem. E.g. Spotify might actually be very happy to hand over 30% of profit per user to apple, as opposed to revenue per user. But, how the devil do you calculate that simply, for all companies in this category? I don't know exactly how to address it, but Apple should in some way address the fact that not all digital goods have zero marginal costs to sell. This is far from the only issue at play, but I haven't seen it addressed, and I think it's fairly central.
  • teilo 8y ago
    That may be true for bedroom developers, but it's just not true for the great majority of people or companies making money on app sales. Consider how many of them rely on cloud infrastructure. Those are not sunk costs. Consider also how necessary it is to market your apps, pay your staff, etc. Also not sunk costs.
    • graeme 8y ago
      Those are generally average costs, not marginal ones. I don’t mean overall profit is 100%. I mean profit on a single extra sale is genrally between 80-100%.
  • nacs 8y ago
    1) The Apple statement that the royalty drops to 15% after the first year (so Spotify is not paying 30%) 2) Also from that statement -- the majority of Spotify customers are either free (ad-supported) customers or don't pay for Spotify through the in-app purchase I'm actually a Spotify customer and am also one of the people who subscribed through the Spotify site instead of the in-app purchase (of which Apple gets no cut).
• deleted 8y ago
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• chmaynard 8y ago
  I'm curious to know which individuals actually wrote Apple's response and why they chose not to take personal responsibility for their statements. In academia, scientific papers and scholarly debates are always presented by individuals, not by their employers. If professor X from Harvard disagrees with a claim by professor Y from Yale, the argument isn't framed as a dispute between Harvard and Yale. On the other hand, in the business world debates like this are usually presented as a dispute between faceless corporations. Is there is some legal reason for this?