Spotify Condemns Apple’s New 27% Transaction Fee as ‘Outrageous’

In a recent escalation of the ongoing friction between tech giants, Spotify has vehemently criticized Apple’s newly imposed transaction fees in the US, labelling them as “outrageous.” This development follows Apple’s announcement to permit app developers to sell products outside its store, yet still demanding up to a 27% commission. Spotify’s fervent and unyielding response questions Apple’s motives and calls for regulatory intervention in the UK to prevent similar impositions.

Spotify’s anger stems from Apple’s decision, resulting from its protracted legal skirmish with Fortnite developer Epic Games. Despite Apple’s victory on multiple fronts, the court identified a violation regarding app developers’ inability to inform users about alternative payment methods. This led Apple to introduce new rules in the US, where developers can bypass Apple’s payment system but at a substantial cost—a commission of up to 27%.

Apple, defending its stance, claims this fee aligns with the court ruling and emphasizes the benefits App Store developers receive, including marketing support, advertising, and a secure environment for app downloads and purchases. However, Spotify counters this narrative, asserting that Apple’s policy blatantly undermines the US court’s efforts to foster competition. Their statement accuses Apple of relentlessly safeguarding its profits, even at the expense of developers and consumers.

The tension is not new. Spotify’s history of challenging Apple dates back to October 2023, when they accused Apple of exerting an “insane” level of internet control. Now, Spotify has turned its attention to the UK, urging the government to act against Apple’s fee structure through the proposed Digital Markets, Competition and Consumer Bill. This bill, introduced last year, aims to curb the dominance of tech giants and promote competitive digital markets.

The UK Government, while not directly addressing Apple’s specific case, has indicated that the bill would allow for “targeted measures” in app store transactions. Yet, it remains to be seen if this legislation, once enacted, would directly influence Apple’s controversial fee policy.

Spotify’s outcry against Apple’s 27% commission reflects a broader struggle within the tech industry, where market dominance and fair competition are increasingly contentious issues. As regulatory frameworks evolve, particularly in the UK, the outcome of this dispute could set significant precedents for the future of digital marketplaces and the balance of power among tech behemoths.