Apple Faces Nearly $2 Billion Antitrust Fine From The European Union

On March 4, 2024, the European Union fined the U.S. tech giant Apple over music-streaming restrictions.

With this action, Apple faces nearly $2 billion antitrust fine for abusing its market dominance.

The real reason why Apple faces nearly $2 Billion antitrust fine

On Monday, EU antitrust chief Margrethe Vestager announced the European Commission’s decision to fine Apple $2 billion (€1.8 billion).

As per the commission’s findings, the tech giant violated antitrust rules by shutting out music-streaming rivals on its platforms.

Apple unfairly favored its own music streaming service by forbidding rivals like Spotify from telling users how they could pay for cheaper subscriptions outside of iPhone apps.

Apple’s Appeal Going On Effect From March 7

Stating that its behavior is entirely legal, Apple plans to appeal the decision arguing that EU’s reports lack credible evidence and benefits Spotify.

Apple issued a blog post on its website saying that Spotify is taking advantage of the Apple Exosystem by paying basically no commission fees.

One of CNBC’s reporters mentioned that when he talked with Spotify’s lawyers, they said that Apple’s ecosystem wouldn’t be as succesful without these third-party apps.

As Apple faces nearly $2 billion antitrust fine, their idea for complying with the European Commission rules goes into effect on Thursday.

With the $2 billion fine, the powerhouse tech company might not see significant damage. But their appeal might work through the European Union’s process for years to come.

What Happened To Apple’s Stock?

With the EU’s fine, Apple’s Stock fell on Monday morning with a 2.5% fall rate in U.S trading.

The European Commission said in a press release Monday that the company was abusing its dominant position in the market. That certainly didn’t go well in the market.

Apple faces nearly $2 billion antitrust fine. Image Credit: Google.

By March 5, Apple’s shares saw a mid-range turbulence. However, there is nothing to worry about for the trillion-dollar mega-giant.

Spotify complained that Apple put it at a disadvantage by not letting it tell its customers about subscription deals.

This is the first-ever penalty against Apple levied by the EU. The EU has led Global efforts to crack down on big tech companies.

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What’s Up with Spotify and Apple’s “Rivalry”?

This is over Apple Music in Europe. Spotify filed a complaint with the European Commission several years ago.

Spotify launched its first complaint in 2019, saying Apple was making it difficult for consumers to find its services outside of Apple’s ecosystem for less money.

Further, Spotify said that Apple were blocking Spotify’s ability to set up alternate ecosystems charging Spotify what they call the 20 the 30% Apple tax.

Apple takes a 30% cut of everything that flows through the App Store.

Tech analyst Cary Levy spoke on this battle that has been brewing for years.

This is the first time that the EU has used its new digital markets act to limit an American company’s monopoly.

How does this benefit the consumer?

Over the years, the EU has targeted big tech companies like Apple to limit their monopoly. Meanwhile, it could open the door to consumers to pay less for subscription services to streaming platforms like Spotify.

As of now, Spotify is bound by Apple’s giant infrastructure. If you want to subscribe to Spotify through Apple’s devices, you are going to pay more for it.

The EU Commission clarified its point as Apple faces nearly $2 billion antitrust fine. But it’s a reminder that the fine might increase from $2 billion.

So, Europe always has been relatively leading edge on tech legislation when other massive companies tried to limit competition.