Apple hit with landmark $2 billion EU antitrust fine

The European Union has fined Apple €1.84 billion ($2 billion) for breaking its competition laws.

The bloc announced Monday that it would impose the fine — its first-ever antitrust penalty on the US tech giant — for preventing rival music streaming services such as Spotify from telling iPhone users that they could find cheaper ways to subscribe outside of Apple’s app store.

Margrethe Vestager, the EU’s competition and digital chief, said Apple (AAPL) had “abused its dominant position” as a distributor of music streaming apps, adding that European consumers did not have “a free choice as to where, how and at what prices to buy music streaming subscriptions.”

“This is illegal and it has impacted millions of European consumers,” Vestager said at a press conference.

Apple responded that the decision of the European Commission, the EU’s executive arm, had been reached despite “its failure to uncover any credible evidence of consumer harm, and ignores the realities of a market that is thriving, competitive, and growing fast.”

The company said in a statement that app developers “compete on a level playing field” on Apple’s app store.

The European Commission opened a formal antitrust investigation into Apple in 2020 after Spotify (SPOT) lodged a complaint against Apple the previous year, accusing it of unfairly disadvantaging its competitors.

It said Apple required the Swedish music streamer and other content providers to pay a 30% fee on purchases made through Apple’s in-app payment system, while its own service, Apple Music, didn’t have to pay the fee. Spotify also said Apple prevented it from sharing information about subscription deals with customers who use iPhones.

Apple is “one of the biggest sellers of the smartphone” and its smartphone operating system “is the only way to offer our app to anyone with an iPhone,” according to Spotify.

In January, Apple announced changes to its handling of apps in the EU, including plans to allow third-party app stores on iPhones and iPads for the first time in the company’s history and significant cuts to its app store fees.

The changes were unveiled in anticipation of EU regulations taking effect this month as part of the Digital Markets Act, a sweeping set of competition rules for Big Tech.

This is a developing story and will be updated.

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