Apple says Spotify exaggerated how much ‘App Store tax’ it pays

TechCrunch | 6/24/2019 | Staff
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In March, Spotify filed a complaint against Apple with the European Commission over the so-called “Apple tax” and claims of restrictive rules regarding the App Store. In the time since, Apple has responded with the launch of a website that takes aim at the anti-trust, anti-competitive claims against it, and most recently, a deep dive into how the process of app approvals work, by way of a CNBC profile. Now, Apple has responded to the EC complaint with its own filing which says Spotify is only paying this “Apple tax” on less than one percent of its paid subscribers.

This news was first reported by Music Business Worldwide (MBW) and German site Der Spiegel.

Apple - Filing - Spotify - % - Tax

Specifically, Apple’s filing says that Spotify only pays a 15% “app tax” (revenue share) on just 0.5% of its 100 million premium subscribers, or around 680,000 customers. This revenue share only impacts those customers Spotify acquired during the 2014-2016 time frame who signed up for the subscription through an in-app purchase. Afterward, Spotify switched off the option to sign up in the app.

This is contrast to the claim made by Spotify CEO Daniel Ek on the company’s blog in March, where he wrote that “Apple requires that Spotify and other digital services pay a 30% tax on purchases made through Apple’s payment system.”

Addition - MBW - Reports - Source - Spotify

In addition, MBW reports, citing an unnamed source, that Spotify pays even less than the standard 15% for those customers who signed up through in-app purchase due to label discounts. The source told the outlet that Spotify just wants to “pay nothing.”

However, Spotify’s claim goes beyond the Apple tax.

Apple - App - Store - Power - Competitor

It also said that Apple used its App Store power to penalize the competitor in other ways — like limiting Spotify’s ability to communicate with customers, or even send emails to its iOS users. Spotify said Apple also...
(Excerpt) Read more at: TechCrunch
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