Spotify to dodge Apple taxes and sell audiobooks straight from app
Spotify wants to start selling audiobooks and subscriptions directly from iPhones in the EU, bypassing Apple's controversial fees with the introduction of new EU regulation.
For several years, Spotify has not been giving users the option of buying a subscription from within its app due to the commission fees that Apple charges for subscriptions. Apple rules have also prohibited the Swedish audio streaming company from telling users about audiobook offers.
However Spotify says users will soon be directed from the app to a page where they can enter their payment details to buy subscriptions and audiobooks, the music streaming market leader explained in a blog post on Wednesday.
There was no immediate response from Apple, which denies that its app shop business falls under the EU's Digital Markets Act (DMA), coming into effect on March 7 in an effort to prevent unfair practices by gatekeepers in the tech industry.
On Apple's iPhones, the company's own App Store is currently the only source from which apps can be downloaded to the device.
When purchasing digital items in an app, developers must pay 30% of the purchase price to Apple. For subscriptions, this is 30% to start and later 15%.
Despite long being criticized by other businesses as unfairly high, this fee cannot be avoided because the use of Apple's system for in-app payments is mandatory.
Apps such as Spotify or Netflix can also sell subscriptions outside the Apple platform on the web - and their customers can then also use them on the iPhone and iPad. In this case, Apple does not receive a percentage.
However, Spotify has long complained that Apple does not allow information about prices and locations for external subscription purchases to be provided in the app.
Following a recent court judgement, Apple has also had to allow app developers in the US to direct their users to external purchase options.
Apple has not yet published any plans for DMA implementation. The company argues that it actually operates five app stores, as the platforms for different devices such as iPhones, iPads or Mac computers must be considered separately. They do not fall under the DMA individually.
The Wall Street Journal reported on Wednesday that Apple is planning new restrictions and fees for users in Europe coinciding with the enforcement of the EU's DMA rules, under which the company must allow apps from other sources to be downloaded to the iPhone.
Spotify countered that Apple would have to implement the regulations first, even in the event of an objection. Spotify is hoping that the European Commission will enforce the DMA rigorously.
