Spotify, Apple's Escalating Fight Interests Lawmakers

Spotify, a Swedish service, last week blasted Apple for rejecting an updated version of its popular streaming app in the online store used by iPhone users, according to The Hill.

At issue, according to Apple, is Spotify’s decision to take out a feature that let its users buy premium subscriptions through Apple’s in-app purchase feature or take steps to sign up online. In the most recent version, users are simply told that premium service is available.

When users buy through the in-application purchase tool, Apple gets a cut; when they buy online, Apple gets nothing.

Apple says that Spotify is violating rules designed to prevent an end-run around the commissions system. Spotify says Apple is trying to stifle competition.

Senator Al Franken

The Federal Trade Commission reportedly began looking into the issue last year, though not through a formal investigation, as streaming services ramped up their criticism of Apple. Sen. Al Franken (D-Minn.) also asked for a federal probe into the issue.

Spotify has been making its case on Capitol Hill. The company reached out to over a dozen offices over its most recent criticisms of Apple, according to a person familiar with the effort. Their pleas have not gone unnoticed.

“I remain concerned about how Apple’s in-app purchasing practices have affected transparency and prices for consumers,” Franken said in a statement first obtained by Politico.

Spotify contends that Apple’s policy of taking commissions on in-app purchases hurts its competitors in the music streaming space by forcing them to charge higher prices for their subscription services.

Apple takes a 30 percent cut on in-app purchases. That number goes down to 15 percent if a subscriber sticks around for more than a year.

Spotify says the policies forces the company to charge more in its premium subscriptions when they sell it in the application. The company charged $12.99 per month for a subscription sold through the in-app option and only $9.99 when it was purchased online. Apple Music's individual plan costs $9.99 a month.

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