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The city of Brussels on Monday fined Apple $2 billion (R38 billion) for hindering competition with music streaming rivals through App Store restrictions. This is the first fine imposed on an iPhone maker for violating EU rules.
The European Commission last year accused Apple of preventing Swedish streaming service Spotify and others from informing users of payment options outside the App Store, following a 2019 complaint by Spotify.
The group said Monday that Apple's restrictions amount to unfair trading conditions, a relatively novel claim in an antitrust case brought by Dutch antitrust authorities in 2021 by a dating app provider. He said it was also used in the judgment against Apple in a lawsuit. He ordered them to stop such acts.
Apple said it would appeal the decision. A ruling at Europe's second-highest court, the Luxembourg-based General Court, is expected to take several years. Until then, Apple must pay fines and comply with EU orders.
The company's stock price opened 2% lower.
The fine marks the first time the European Commission has added a lump-sum deterrence fee to top of antitrust fines as a deterrent, and people familiar with the matter told Reuters they expect it to be paid to Apple. It was a dwarf of 500 million euros.
The plan consisted of a basic element of 40 million euros, which European Competition Commissioner Margarete Vestager described as a “parking ticket” for the US tech giants, plus an additional 1.8 billion euros as a deterrent. He said the total amount of 1.84 billion euros was equivalent to 0.5% of Apple's global sales.
Apple criticized the decision in a statement, saying, “It was taken despite the European Commission's failure to uncover any reliable evidence of consumer harm, and it is a prosperous, competitive and rapidly growing company. “It ignores the reality of the current market.”
“The main proponent and biggest beneficiary of this decision is Spotify, a company based in Stockholm, Sweden. Spotify has the world's largest music streaming app, and during this investigation the European Commission “I have met with the organization over 65 times.”
“I was left in the dark”
“Millions of European music streaming users were left in the dark about all the options available to them,” Vestager told a news conference.
“Apple's anti-steering rules also shift the high fees charged to developers to consumers, resulting in consumers paying more for such services. ”
Spotify welcomed the EU's decision, but said there were other issues in other areas.
“And while we are pleased that this lawsuit brings some measure of justice, it does not resolve Apple's bad behavior towards developers beyond music streaming in other markets around the world,” the company said in a statement.
Ryan Reese, an analyst at technology services firm IDC, said the total fine would be huge for any company, but Apple could deal with it without immediately impacting its cash.
“I believe this is another step in an ongoing process of breaking down some of the walled gardens that Apple has built around its ecosystem,” he said.
Vestager's order for Apple to lift App Store restrictions reflects the same requirements under new EU technical regulations, known as the Digital Markets Act (DMA), that Apple must comply with on March 7. I am.
But Apple's fine is about a quarter of the 8.25 billion euros that EU regulators have imposed on Alphabet Inc.'s Google in three cases over the past decade.
In contrast to the music streaming scandal, Apple is resolving a new EU antitrust investigation by proposing to open up its tap-and-go mobile payment system to competitors.
EU regulators, which have since solicited feedback from competitors and users, are likely to accept the proposal without fining the company.