Commission Imposes Apple Music Streaming Fine of More Than €1.8 Billion

According to the Commission's decision announcement, the provisions amount to unfair trading conditions in breach of Article 102(a) of the Treaty on the Functioning of the European Union. Apple has been ordered to remove them and to refrain from repeating the infringement or adopting practices with an equivalent object or effect.

What the Commission found

The Commission found that Apple is the sole provider of an app store through which developers can distribute apps to iOS users in the European Economic Area. Its rules banned music streaming developers from informing users within their apps about subscription prices available on the internet, from explaining price differences between in-app purchases and other channels, and from including links to their own websites. Developers were also prevented from contacting newly acquired users, for example by email, about alternative pricing.

The Commission concluded that the conduct, which lasted for almost ten years, may have led many iOS users to pay significantly higher prices because of the commission Apple charged developers, and caused non-monetary harm through a degraded user experience.

How the fine was set

The fine was set under the Commission's 2006 Guidelines on fines, taking into account the duration and gravity of the infringement, Apple's total turnover and market capitalisation, and the fact that Apple submitted incorrect information during the procedure. The Commission added a lump sum of €1.8 billion to the basic amount to ensure deterrence, explaining that much of the harm was non-monetary and could not be captured by the usual revenue-based methodology.

The investigation opened in June 2020. A Statement of Objections followed in April 2021 and was replaced in February 2023 by a revised Statement of Objections.

What happens next

Apple can challenge the decision before the EU General Court. For app developers and digital platforms, the decision signals how the Commission approaches restrictions on steering customers to alternative offers under Article 102, and the Commission's readiness to add a deterrence lump sum where harm is largely non-monetary. Platform operators may wish to review store rules that limit how business users communicate prices to their customers.

Sources

• European Commission: Commission fines Apple over €1.8 billion over abusive App store rules for music streaming providers
• European Commission: Competition case AT.40437, Apple App Store practices (music streaming)