Apple Faces $2 Billion Fine from EU for App Store Practices

The European Union (EU) has imposed a nearly $2 billion fine on Apple Inc. for allegedly using its app store to stifle competition, as reported by the Associated Press. The European Commission found that Apple prevented app developers from fully informing iOS users about alternative and cheaper music subscription services outside of the app, violating EU antitrust rules.

The violation, which occurred over almost a decade, led to many users paying significantly higher prices for music streaming subscriptions, according to the commission. The fine of $1.8 billion follows a lengthy investigation initiated by a complaint from Swedish streaming service Spotify five years ago.

The EU has been actively targeting major tech companies, recently imposing multibillion-dollar fines on Google and accusing Meta of distorting the online classified ad market. Additionally, the EU has launched a separate antitrust investigation into Apple’s mobile payments service.

Initially, the commission’s probe focused on Apple’s practice of forcing app developers to use its in-house payment system, which charges a 30 percent commission on all subscriptions. However, the investigation shifted to how Apple prevents app makers from informing users about cheaper ways to pay for subscriptions outside of the app.

The EU found that Apple banned streaming services from disclosing subscription costs outside of their apps and restricted them from providing links or emails to users about alternative pricing options.

This fine coincides with the implementation of new EU rules, set to start this week, aiming to prevent tech companies from dominating digital markets. The Digital Markets Act imposes regulations on “gatekeeper” companies like Apple, Meta, Google, and ByteDance, threatening them with significant fines for non-compliance.

In response to these rules, Apple has outlined measures to comply, including allowing European iPhone users to use app stores other than its own and enabling developers to offer alternative payment systems. Additionally, Apple has promised to open up its mobile payment system to competitors to address a separate antitrust investigation by the commission.

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