The European Union has imposed a record fine of nearly $2 billion on Apple for using its app store to stifle competition in the music streaming market.
The EU’s executive arm, the European Commission, said on Monday that Apple violated antitrust rules by preventing app developers from informing iOS users about cheaper alternatives to its own music service, Apple Music.
The commission said that Apple’s practices resulted in higher prices for consumers and reduced choice and innovation in the music streaming industry.
The fine of 1.64 billion euros ($1.87 billion) is the largest ever imposed by the EU for a single antitrust case. It follows a five-year investigation that was triggered by a complaint from Spotify, the Swedish music streaming giant that competes with Apple Music.
“Apple deprived millions of European users of cheaper music streaming choices and distorted competition,” said Margrethe Vestager, the EU’s competition commissioner, in a statement. “This is unacceptable.”
Apple said it plans to appeal the decision, calling it “the opposite of fair competition.”
“Spotify has become the largest music subscription service in the world, and we’re proud of the role we played in that,” Apple said in a statement. “The commission’s argument on Spotify’s behalf is the opposite of fair competition.”
The EU’s decision comes amid a global crackdown on the dominance of big tech companies, especially in the digital markets where they act as gatekeepers for millions of users and businesses.
The EU has been at the forefront of this effort, imposing billions of dollars in fines on Google for various antitrust violations and charging Meta, formerly known as Facebook, with abusing its market power in online advertising.
The EU has also introduced new regulations, such as the Digital Markets Act, which will take effect on Thursday, to curb the unfair practices of tech giants and ensure a level playing field for smaller rivals.
The Digital Markets Act will impose a set of dos and don’ts on companies that are deemed to be gatekeepers, such as Apple, Meta, Google, and TikTok. These include allowing users to uninstall pre-installed apps, providing access to data and interoperability, and refraining from favoring their own services over others.
Apple has already announced some changes to its app store policies in response to the new rules, such as allowing iPhone users in Europe to download apps from other sources and enabling developers to offer alternative payment methods.
The EU is also investigating Apple’s mobile payments service, Apple Pay, for possible antitrust violations. Apple has said it will open up its tap-and-go payment system to other providers to address the EU’s concerns.