Apple responds to Spotify with words, but no real answers

Apple:<p>&gt; 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.<p>OP:<p>&gt; Apple saying that it&#x27;s &quot;trying to make money of others&#x27; work&quot; while ignoring that the App Store is doing exactly that on an unprecedented scale by restricting choice is truly ironic.

Apple is pretty much saying “I own all the rails and it’s ok for me to compete with the transport companies that use them”. This might not be ok in EU, but US doesn’t give a sh*t. No matter how much developers, songwriters, consumers, etc get screwed by some greedy corporations. $1000 is not enough for a phone, we still need to pay 30% of all the apps we’re using... It’s a crazy world.

The App Store is a voluntary system for all developers. Nobody is forced to write apps for the iPhone—and Apple did put a lot of work into making the ecosystem work very well for developers. Whether they deserve exactly 30% of revenues is a valid debate, but there is no doubt that Apple&#x27;s efforts adds value to the market.<p>What has Spotify done for anyone? What is so genius about saying &quot;hey, you can have this really cheap product because we&#x27;ve somehow convinced our suppliers to sell us the product for next to nothing!&quot;

Apple&#x27;s official response (direct link): <a href="https:&#x2F;&#x2F;www.apple.com&#x2F;newsroom&#x2F;2019&#x2F;03&#x2F;addressing-spotifys-claims&#x2F;" rel="nofollow">https:&#x2F;&#x2F;www.apple.com&#x2F;newsroom&#x2F;2019&#x2F;03&#x2F;addressing-spotifys-c...</a>

This seems like an overly emotional interpretation of things, written in an intentionally aggressive style.<p>Are there any lawyers here who can actually make an interpretation of the situation free of emotion and PR speak? I still don&#x27;t understand the fundamental basis for why Apple is legally obligated to &quot;play fair&quot; on the App Store. Reasons I&#x27;ve heard that don&#x27;t make sense to me include:<p>- XYZ, inc. made a business on the App Store, so XYZ should be free to pay a cut to Apple that is intuitively &quot;fair&quot; in some vague sense, simply because their entire business is on the App Store.<p>- 30% just sounds intuitively too much, so they aren&#x27;t playing fair<p>- 30% is higher than other, vaguely related platforms charge for vaguely related services, so that means it&#x27;s unfair simply because the number is higher<p>- Apple also makes apps that sell the same types of subscriptions, so Apple should be fixing prices of competing services at a point where...? Spotify can make a profit? Consumers are just always charged the same amount for any &quot;music app&quot; from any competing company? This seems to be the one that a lot of people hang their hat on as the nuanced way to look at it.<p>&quot;No, but it&#x27;s about the <i>competing product</i> they offer, they <i>undercut</i> Spotify&#x27;s price.&quot; etc.<p>But, undercut what? Spotify&#x27;s price point relative to their current business model? I don&#x27;t understand the argument here. Spotify is another business. We&#x27;re not talking about some minimum wage thing for a person where you have a moral imperative to keep the price above a certain point, inherently.<p>I don&#x27;t understand why any legal system should be forced to take Spotify&#x27;s current business model as the peak optimal one possible, and then say that they couldn&#x27;t possibly lower their price to match Apple&#x27;s competing service without irreparable harm to their business. Why does any of this matter, legally? Companies make money, industries grow and fade, niches pop in and out of existence as paradigms shift, business cycles up and down. What are the laws that mean Apple must be civil with Spotify here?

I saw it is possible for netflix to direct user to a website to update his&#x2F;her payment method. On the other hand spotify is not being allowed to develop such button in their app.<p>Netflix and spotify both delivering digital goods.<p>Why does such policy difference exist?<p>I asked apple officials and waiting for a reply.<p>We also have a digital goods transaction based app.(digital photo) We are also not allowed to use such button. Why does netflix have that option to use such thing?

If I was advising Apple on how to react to this manufactured crisis, I&#x27;d use it as an opportunity to voluntarily raise whatever royalty payment(s) go directly to the artists.<p>They already pay more to artists than Spotify, but the best way to win the argument is to make the comparison comprehensively unambiguous. Turn it into a competition on which service supports the artists more.

Wait a minute. Apple actually directly addresses most if not all of the Spotify claims. I did not read the entire article but this is absolutely not true. I don’t think Spotify has a leg to stand on here. I’m all for equal opportunity, but aside from being a music sharing service, what have they really done? Apple built the platform, store and payment system. Spotify is welcome to complete with something better.

It&#x27;s an argument of rent-seeking vs rent-seeking. Apple technically has a right to a cut on all purchases made through their platform; however there may be a conflict of interest in this case as they own one of the direct competitors to Spotify (Apple Music). Regardless, at the end of the day the artists are the ones that lose out on $$$ and are getting screwed.

I feel like Spotify has 3 arguments:<p>1. Apple music too cheap<p>2. Apple tanks Spotify app<p>3. Apple&#x27;s 30% is too much<p>For them Apple responded:<p>1. Spotify has much more freeloaders than paying users, so it has to be more expensive than Apple Music<p>2. Responded in length, that Spotify is not special, and got same treatment as anyone else<p>3. Responded that same as Spotify, far from all apps are payed, and infrastructure is shared by everyone. So 30% cut is not to support only paying apps, but all the App Store.<p>I am pretty satisfied with Apple&#x27;s answers.