European Commission finds no evidence of collusion between Apple and music labels

“The European Commission failed to find evidence of collusion among the major music labels and Apple to quash free music streaming services such as those offered by Spotify, according to four sources with knowledge of the matter,” Dawn Chmielewski reports for Re/code. “Investigators examined whether the labels conspired with one another or with Apple on Apple’s new streaming music service in a way that would hurt rivals. The probe failed to turn up any illegal activity, though the EU will continue to monitor the market, sources said.”

“Separately, the EU has asked Spotify and other music streaming services for information pertaining to Apple’s mobile App Store, according to people with knowledge of the situation. Regulators are seeking information on the restrictions Apple places on apps offered through the store,” Chmielewski reports. “The U.S. Federal Trade Commission similarly is exploring whether Apple’s treatment of rival streaming music apps in the App Store violate antitrust laws.”

“Music industry executives have accused Spotify of urging the EU to look into the sector ahead of Apple Music’s launch, though label executives drew attention to the issue with public statements criticizing free streaming,” Chmielewski reports. “The trade publication Mlex, which closely tracks the regulatory issues, first reported that the EU had found no evidence of misconduct in its streaming music inquiry.”

Read more in the full article here.

MacDailyNews Take: Oh ok. 🙂

As per the App Store: If Spotify, Rdio, Rhapsody, Tidal, Pandora, etc. don’t like Apple’s App Store terms, they are free to market their wares to non-iOS users. Surely their “freemium” offering will be in very high demand among the BOGOF cheapskate set who have proven extremely willing to surrender their privacy and personal date in exchange for what they erroneously think is “free.”

As myopic “analysts” like to repeatedly tell each other on CNBC, Apple’s iOS market share is dwarfed by Android, that amazing and wondrous OS that delivers not only a poor facsimile of iOS along with 99% of all mobile malware, but also exceedingly profitless results for knockoff peddlers the world over. Therefore, Apple clearly does not have a monopoly in smartphones (only in brilliantphones), so there’s simply no monopoly to abuse.

Spotify and the rest of the also-rans: Go peddle your outmoded, inferior crap to the billion+ fragmandroid settlers if you don’t like Apple’s App Store terms. Knock yourselves out.

SEE ALSO:
Apple Music may have an ‘unfair’ advantage, but it likely isn’t illegal – July 27, 2015
U.S. Senate Democrat Al Franken urges federal probe of Apple Music – July 23, 2015
Consumer Watchdog Asks U.S. feds to investigate Apple Music over alleged ‘antitrust violations’ – July 22, 2015
Oh ok, Spotify listeners are upgrading to Apple Music – July 19, 2015
Apple Music faces antitrust scrutiny in New York, Connecticut – June 10, 2015
Apple unveils revolutionary Apple Music service – June 8, 2015
a href=”http://macdailynews.com/2015/05/07/rival-music-services-claim-apples-app-store-pricing-is-anticompetitive/”>Rival music services claim Apple’s App Store pricing is anticompetitive – May 7, 2015
EU regulators already probing Apple’s music streaming plans in Europe – April 2, 2015

[Thanks to MacDailyNews Readers “Fred Mertz,” “Dan K.,” and “BD” for the heads up.]

11 Comments

  1. It’s not illegal in the US or Europe to leverage one minority market share (like mobile OSes) to try to enter a new market (like music streaming). What’s illegal in both is leveraging a monopoly to monopolize another market. However, at least in the US, California’s Northern District Court ruled in Dec 2014 that iTunes Music Store is not a digital music monopoly. I don’t know how the EU feels about this.

    I have believed consistently, since studying up on it during the Microsoft antitrust trials, that like personal freedom, the price of a free market is eternal vigilance. It may feel ironic, but it’s not. Sherman Act enforcement is vital to permitting free markets to operate.

    However, Apple doesn’t have a monopoly in any relevant market. It’s brilliant really. What they’ve monopolized is the PROFITS from mobile devices and mobile apps. But that’s not a monopoly by Sherman Act definition. (And it shouldn’t be.)

    1. “What’s illegal in both is leveraging a monopoly to monopolize another market.”

      Actually, it is illegal to leverage a monopoly position to *expand* market share in another market or market segment. As examples: it is illegal to attempt to leverage a monopoly to go from 0% to 10% in another market or go from 5% to 40% in another market segment.

      It does not have to be an attempt to create a monopoly in another market.

  2. Sour grapes.

    To suggest Apple Music has an edge over other streaming services because they charge a 30% fee, for subscribers… It’s absurd. Apple can’t charge it’s self. And the 30% fee has nothing to do with streaming music. It’s a transaction fee for all services, from books to apps, from music to Movie/TV.

    The 30% is not really a great margin, considering they have to pay for the infrastructure. It’s more or less to cover operating expenses. It simplifies the process.

    Since Spotify has an unsustainable business model, that’s not Apple’s fault.

    1. I think the argument 3rd party companies are trying to get across is that there is a 30% overhead for them before the profits from which payment to artists are made. This does not exist for Apple Music since it is an in-house music service creating an uneven playing field for competitors for the ‘captive’ audience. I suppose since these companies agreed to Apple’s terms they have to ‘deal’ with it.. Wonder what would happen if it gets to the point where a huge majority of these 3rd party media companies (ebooks, music, video, etc.) are fed up and remove their Apps from the iTunes store in a short period (e.g. 1 month).. Since it is not illegal now to jailbreak your iOS device wonder how many would go that route to get access to the 3rd party services over Apple’s in-house version.

      1. A solution is then, Apple is not allowed to have a music service, or they are not allowed to charge other music services to offer music. We are not even talking about content creators here, we are talking about distribution, a leaching business model.

        Regardless it’s a cluster. Having ownership of both sides of the street has it’s problems.

        -(All in the guise of fairness)-

        If Spotify leaves the App Store, they loose customers. If they stay in the App Store, they pay 30% net sales, as a fee. For them, it’s loose-loose. They are screwed just for trying to run a business. They were “not” paying the artists well from the start, before they got into Apple’s App Store.

        In the end, does it really matter if Apple enters the scene? They also pay the artist a bigger share, conceivably 70%, which is unheard of, and is exactly Apple’s model. Cut out the leaching distribution aggregators.

        1. Perhaps the policy should be more general. Any service that Apple introduces that is in direct competition with a 3rd party that also offers a very similar service via App in the App Store will release that company from further 30% charges on in-App subscriptions/purchases for their App.

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