Spotify might have its critics, especially among artists who bemoan its payment terms, but there is little doubt it has revolutionised the market and made music far more accessible to all.
However, the streaming service has not had everything its own way and has been at war with Apple since 2011, when the iPhone giant started charging developers 30% of any subscription fees to use its IAP billing system.
The so-called ‘app tax’ led Spotify to ditch IAP, meaning consumers could no longer upgrade to Spotify Premium through the app.
According to Spotify, Apple then put it under constant pressure over a three year period to adopt IAP and in 2014 it finally agreed to join but this meant the steaming service had to raise its prices from €9.99 to €12.99 to cover Apple’s 30% commission, much to the annoyance of many customers.
In 2015, Apple then launched its own service, Apple Music, but because it did not have to pay itself commission it could price it at €9.99.
The row has been raging ever since, and Spotify has a fight on its hands, with Apple refusing a raft of Spotify initiatives. In 2019, Spotify reported Apple to the European Commission over its anti-competitive practices, although it is still awaiting a firm decision.
In the meantime, it has also launched the “Time to Play Fair” campaign, which this week sees a new execution to highlight the restrictions that Apple places on developers like Spotify. It is argued that these measures not only stop users from being able to easily learn about new deals and promotions, they also prevent them from improving their digital experience and saving money.
Featuring Spotify’s 3MF Premium offer for free tier or new users in the UK, the “Censored” campaign includes advertising in key locations in London, such as a high profile poster site in Leicester Square and bus stops in Westminster, as well as in an email campaign to all eligible iOS users – but with a twist.
The information about the offer is redacted in the OOH displays, reflecting how Apple prevents Spotify from sharing key details of its deals, promotions or alternative payment links with customers who use its app on iOS.
In the US, Spotify has branded Apple’s recent attempted move to impose a 27% fee for transactions made outside of an app on a developer’s website as “outrageous”, accusing Apple of stopping at nothing to protect its profits.
In the EU, Spotify last week announced how it will change iPhone app to include previously banned in-app sales and promotions of its own services as Europe’s new Digital Markets Act (DMA) comes into effect.
Spotify is the first leading tech company to change how it does business in response to the DMA – a bill passed last year that regulates competition practices of gatekeeper tech companies like Apple. But with Apple continuing to reject the goals of the DMA and put forward unworkable alternatives “masquerading as compliance with the law”, Spotify is stepping up its calls on the Commission to take action.
In the UK, Spotify is urging the Government to pass a strong Digital Markets, Competition and Consumers (DMCC) Bill that brings consumers a thriving, expanded tech sector. Recent research – commissioned by Spotify – shows consumers back fairer digital markets, with 56% of Brits supporting the DMCC in forcing large tech companies to allow developers like Spotify to tell their users about ways to save money.
Spotify head of global government affairs and public policy April Boyd said: “For far too long, Apple’s anti-competitive practices have kept UK consumers in the dark about ways to save money.
“We want to show consumers what a fairer digital market should look like, with greater transparency, increased convenience, and new promotions. This is why Spotify supports a strong DMCC Bill that creates a level playing field, ensuring the UK remains a leading market for digital innovation.”
So, what is the consensus around the Decision Marketing office?
Well, we’d like to say this row doesn’t affect us as we only listen to music on vinyl, CD, cassette, MiniDisc and 8-track. Sadly, while these formats still get used here, there is no getting round the fact that Spotify is way easier and is therefore crucial to our sanity.
To be fair, we do still have an Apple iPod, too, but seemingly like a lot of Apple products, the battery lasts about ten minutes… so is virtually useless.
Now, of course, Apple – worth a staggering $2.89 trillion compared to Spotify’s $42.02bn – has long tried to champion itself as the consumer’s friend, insisting its privacy measures are way stronger than rivals’. However, there is a growing dossier of evidence that accuses the company of engaging in invasive practices similar to those it forbids among third-parties and of anti-competitive behaviour.
And, to be fair, anything that stamps this out for good is music to our ears.
Decision Marketing Adometer: A “Blitzkrieg Bop” 8 out of 10
