World’s most valuable company is joining the bandwagon of spreading misinformation

Apple’s weird rebuttal to Spotify’s EU complaint

Apple published a press release to defend their position with regard to Spotify’s complaint to the EU about the App Store practices.

The narrative in this press release is…. questionable. Let’s go through it:

At its core, the App Store is a safe, secure platform where users can have faith in the apps they discover and the transactions they make. And developers, from first-time engineers to larger companies, can rest assured that everyone is playing by the same set of rules.

This is an Apple-benefit. They want their devices to be secure. The App Store hurdle is NOT to facilitate companies and developers but to protect Apple’s customer and Apple’s reputation (in case of malware, abuse, high battery usage).

What Spotify is demanding is something very different. After using the App Store for years to dramatically grow their business, Spotify seeks to keep all the benefits of the App Store ecosystem — including the substantial revenue that they draw from the App Store’s customers — without making any contributions to that marketplace.

The App Store was invented to benefit Apple and Apple’s customers. If there was no way to install an app on the iPhone, I am 100% sure it would not be as successful as it is today. I love how they reverse the logic on the existence of the App Store.

Spotify has every right to determine their own business model, but we feel an obligation to respond when Spotify wraps its financial motivations in misleading rhetoric about who we are, what we’ve built and what we do to support independent developers, musicians, songwriters and creators of all stripes.

I love they use misleading rhetoric and calling it “misleading rhetoric”. The App Store has not been developed to support any of these people.

Spotify claims we’re blocking their access to products and updates to their app.

Let’s clear this one up right away. We’ve approved and distributed nearly 200 app updates on Spotify’s behalf, resulting in over 300 million downloaded copies of the Spotify app.

Where is Spotify on my Apple TV? Or the Home Pod? Ah yes, Apple is blocking competing products on their own platform to give themselves a headstart. Now, this is fine since it is their own ecosystem and – in my opinion – they can do whatever they want with that. But it is fair to say that Apple is blocking access.

Let’s be clear about what that means. Apple connects Spotify to our users.

Read the between the lines; Apple thinks they “own” their users and can use that as a reason extract rent for access to “their” users.

We provide the platform by which users download and update their app. We share critical software development tools to support Spotify’s app building. And we built a secure payment system — no small undertaking — which allows users to have faith in in-app transactions. Spotify is asking to keep all those benefits while also retaining 100 percent of the revenue.

Apple made about $15B in revenue from the App Store. This cover more or less the wages of all 132,000 Apple employees. I am not sure, but I do not think they all work on the App Store. The point is that the App Store is a big revenue maker for Apple and no just covering the costs to “provide the platform by which users download and update their app”.

Spotify wouldn’t be the business they are today without the App Store ecosystem, but now they’re leveraging their scale to avoid contributing to maintaining that ecosystem for the next generation of app entrepreneurs.

Apple would not be in business without the App Store ecosystem. Right? They talk about contributing to maintaining the ecosystem while Apple makes more revenue on it than they need to “maintain” the ecosystem. I also love that they are pointing to “app entrepreneurs”. I love how they diminish great companies like Uber, Snapchat, Lyft, Robinhood and others as “app entrepreneurs”. Sounds a bit cocky to me.

Just this week, Spotify sued music creators after a decision by the US Copyright Royalty Board required Spotify to increase its royalty payments. This isn’t just wrong, it represents a real, meaningful and damaging step backwards for the music industry.

This is untrue. I cannot even believe that a reputable company as Apple is spreading misinformation. Spotify has appealed a decision of the U.S. Copyright Royalty Board. The decision ultimately impacts the payout to songwriters, but they did not sue songwriters. It is a lot more technical than that.

The narrative of this press release is odd. I do understand Apple needs to fend off attacks on their revenue model, but this feels like misinformation and spreading untruths.

Apple is a tight run ship and it is extraordinary to see a press release like this.

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