Spotify has accused Apple of dirty tactics after the iPhone maker rejected an updated version of its app for not using its billing system. Spotify claims the move is a deliberate attempt by Apple to damage its performance in the iOS market and stifle the threat it poses to Apple Music.
According to Recode, Apple rejected a new version of Spotify's iPhone app citing "business models rules", stating that the streaming service would have to adopt its billing system – which Apple receives a monthly cut off the top of – if it wished to "acquire new customers and sell subscriptions".
In a letter sent to Apple, Horacio Gutierrez, Spotify general counsel, accused the company of "causing grave harm to Spotify and its customers" and said the decision was another example of Apple wielding its authority over iOS to fend of services it sees as rivals to its own.
Apple charges services that use its billing service a fee of up to 30% of revenues gained through subscriptions. As app makers can't distribute their apps to iPhones outside of iTunes, those who want to sell their services to iOS users are forced to use Apple's billing system. This has led to probes into whether the way Apple deals with rival music streaming services is anti-competitive.
In 2015, Spotify raised the monthly cost of its premium service for iOS users from $9.99 to $12.99, in order to mitigate the fees incurred by Apple's billing system. The company then began offering subscriptions at the original cost if they signed up through Spotify's own site.
However, Gutierrez claims that Apple threatened to remove Spotify from its app store if it didn't stop advertising the promotion to Apple customers, according to Recode.
Gutierrez wrote: "This latest episode raises serious concerns under both US and EU competition law. It continues a troubling pattern of behaviour by Apple to exclude and diminish the competitiveness of Spotify on iOS and as a rival to Apple Music, particularly when seen against the backdrop of Apple's previous anti-competitive conduct aimed at Spotify
"We cannot stand by as Apple uses the App Store approval process as a weapon to harm competitors."
Despite growing competition from Apple and elsewhere, Spotify has retained its crown as the king of music streaming services, reaching over 100 million active monthly subscribers in June this year.