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Spotify and Apple Again Clash Over App Store Rules and Fees

Spotify has not been able to get Apple to approve an EU app update that added information on subscription pricing and links to the Spotify website, and it turns out that's because Spotify has not agreed to the terms of Apple's Music Streaming Services Entitlement.

A recent antitrust ruling from the European Commission fined Apple nearly $2 billion and mandated that Apple "remove anti-steering provisions" for music apps in the European Economic Area (EEA). As a result, Apple updated its App Store rules with a Music Streaming Services Entitlement that allows music apps in the EEA to inform users of other ways to purchase digital music content or services and to add website links for purchasing digital music subscriptions.

That might sound like a win for apps like Spotify, but Apple requires developers who use the entitlement to pay a 27 percent fee (reduced for subscriptions older than one year and for small businesses) on all website purchases referred by Apple. So if Spotify puts a link in its app and a user clicks it and subscribes, Spotify would owe Apple a 27 percent commission (three percent less than the App Store purchase fee).

Spotify does not currently pay Apple any money, and it does not want to. Directly after the European Commission's ruling, Spotify on March 5 submitted an EU app update that had information on subscription pricing and links to its websites for customers to make purchases. This was prior to when Apple had announced its entitlement plan.

Apple ignored Spotify's app update, and Spotify complained on March 14 that Apple had not "acknowledged or responded" to its ‌App Store‌ submission. Spotify at the time called on the European Commission to force Apple to approve its app update.

Apple kept ignoring Spotify's submission, until today, when Spotify submitted a new version of its app. Spotify said on X (formerly Twitter) that the update has no links and includes just the "bare minimum" on pricing and a mention that subscriptions can be purchased from Spotify, which it claims is acceptable under the European Commission's ruling.

Spotify left out a small detail, though. It turns out that Spotify did not request a Music Streaming Services Entitlement and did not agree to Apple's new terms for the entitlement. The ‌App Store‌ Review Team sent Spotify a letter (via AppleInsider) that says the entitlement is required even though there is no link because Spotify's submission has a call to action to purchase a Spotify subscription on its website.
We are reaching out to let you know about new information regarding your app, Spotify - Music and Podcasts, version 8.9.33.

As you may be aware, Apple created a new Music Streaming Services Entitlement (EEA) for iOS and iPadOS music streaming apps offered in EEA storefronts. The entitlement allows music streaming apps to use buttons, external links, or other calls to action to direct customers to a purchase mechanism on a website owned or controlled by the developer. You must accept its terms before adding any of these capabilities to your app. Please find more information about the entitlement here.

We note that your current submission includes a call to action to purchase a Spotify subscription on your website. As such, you must accept the terms of the Music Streaming Services Entitlement (EEA) and include the entitlement profile in your app for submission. To be clear, this entitlement is required even if your app does not include an external link (nor does it require that you offer an external link). We will, however, approve version 8.9.33 after you accept the terms of the Music Streaming Services Entitlement (EEA) and resubmit it for review.

If you have any questions about this information, please reply to this message to let us know.

Apple says that if Spotify agrees to the terms of the Music Streaming Services Entitlement, it will approve the latest Spotify app update. Without a link to the Spotify website, Spotify would presumably not have to pay Apple a commission because there would be no way for Apple to track clicks from its app to Spotify, but there may be some other part of the entitlement that Spotify is reluctant to agree to.

Apple does not plan to let Spotify include a link to the Spotify website without paying the required 27 percent fee, but adding subscription pricing information without a link does seem to be permitted per the language of Apple's letter to Spotify.

Spotify has confirmed that it does not plan to opt in to Apple's EU ‌App Store‌ business terms, which are separate from the Music Streaming Services Entitlement and are part of the changes that Apple implemented as required by the Digital Markets Act.

Because Spotify does not want to agree to the EU ‌App Store‌ business terms, it is limited on the features that it can add to its app in the EU. To offer the Spotify app directly from its website in the EU, Spotify would need to agree to the terms and would have to pay a 0.50 euro Core Technology Fee for users that download the app.

Spotify does not let customers sign up for a Spotify subscription in the app as of right now, so it does not have to pay anything. Web-based distribution and linking out to the Spotify website both have associated fees, and Spotify is aiming for a solution where it does not have to pay anything. Spotify's full statement on its update, from Chief Public Affairs Officer Dustee Jenkins:
Despite Apple's attempts to punish developers with new fees, we remain committed to giving consumers real choice in our app at no increased cost. That's why we have submitted a new update to Apple. It features basic pricing and website information - the bare minimum outlined under the European Commission's ruling in its music streaming case.

By charging developers for communicating with consumers through links in-app, Apple continues to break European law. It's past time for the Commission to enforce its decision so that consumers can see real, positive benefits.
Though Spotify has a clear path to get its app update approved, the company claims that Apple is breaking European law by charging the 27 percent fee for links and it calls on the European Commission to "enforce its decision."
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