EU imposes record-breaking $2 billion fine on Apple

The European Commission slapped a massive fine exceeding €1.8 billion on Apple Inc., a prominent US tech company. This penalty was imposed due to Apple’s violation of antitrust rules related to how it distributed music streaming apps through its App Store to iPhone and iPad users in the European Economic Area (EEA). The Commission concluded that Apple’s actions amounted to an abuse of its dominant position in the market.

1. Central to the matter are the limitations Apple placed on app developers, barring them from informing iOS users about alternative and possibly more cost-effective music subscription services offered beyond the App Store. These constraints, known as ‘anti-steering provisions,’ were declared unlawful according to EU antitrust regulations.

2. “The EU’s formidable antitrust regulator stated that Apple’s actions, spanning nearly a decade, likely resulted in numerous iOS users paying notably higher prices for music streaming subscriptions. This was attributed to the steep commission fee imposed by Apple on developers, which was then transferred to consumers.”

3. The move by the European Commission, the executive arm of the EU, marks the most recent in a string of regulations and penalties aimed at the App Store. Many of these conflicts stem from Apple’s mandate that apps utilize its in-app payment service for transactions, through which it imposes a commission of up to 30 percent on each sale—a fee that numerous developers argue is exorbitant.