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Apple burns back: Spotify pays fees of less than 1% of members



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The Spotify app for iPhones has not offered a way to sign up for membership in the app itself since 2016.


Taylor Martin / CNET

Spotify pays Apple a 15% fee for only about 0.5% of its paid members, according to Apple's response to Spotify's App Store Fee Complaint . In March, Spotify sent a complaint against Apple to Europe's antitrust guard, claiming that Apple is using App Store policies and a system of fees to disrupt the competition.

In his reply, Apple said Spotify is currently not paying the highest 30% fee on any of its members and that it pays a lower interest rate (15%) for only about 680,000 Spotify premium tier members. Apple's response was intended to emphasize how little Spotify pays in fees and emphasize that Spotify continues to grow under current App Store policies.

Spotify pays Apple so little in fees because Spotify dropped out of Apple's payment program in 2016, especially because the company believed the fees associated with it were unfair.

Spotify refused to comment directly on the Apple response. The German newspaper Der Spiegel first reported the news.

Feeden groper Apple, a gadget giant whose App Store is critical for mobile services to thrive, against the largest subscription music service in the world and one of the most popular iOS apps. The result of their face can change what you can buy – and how easy it is to buy things from Apple's competitors – on Apple devices and in IOS apps.


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Spotify's original complaint claimed that Apple is using the App Store's power to take advantage of its own products, such as Apple Music subscriptions that go head-to-head with Spotify. It claimed that some of Apple's practices – such as charging subscription companies a 30% fee for app purchases and allegedly rejecting updates to Spotify's app for unclear reasons – abuse the market power of the App Store.

Because Spotify retired from buying in the app in 2016, it no longer buys any new customers through its iPhone or iPad apps. Therefore, it pays a 15% fee to the Apple – the 30% fee falls to 15% after the first year of a subscription, and Spotify's members acquired through an iOS app have long passed the one-year point.

It is also a factor in why Spotify owes Apple fees to such a small number of members; Spotify has been adding members during some of its fastest years of growth in ways that bypass the App Store system in the app buying system.

If Spotify were to resume buying in the app and let listeners sign up to be paid members in their app, some of the new members would be subject to a 30% fee.

Originally published at 08:08. PT.
Updated at 2:52 pm PT : With more detail and context.


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