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Earlier this year, Spotify introduced an iPhone version of its app that will allow users to sign up for ad-free plans right within the app. Despite dramatic changes brought about by the Digital Markets Act and a mammoth $2 billion fine from the EU, Spotify has reportedly changed its position for now.
The Verge's Emma Roth first reported that Spotify will instead add EU-only language to its app describing different subscription levels and prices.
If Apple approves, Spotify app users will be able to follow a link to the Internet where they can purchase a subscription. Apple already allows Spotify and other so-called reading apps that provide content to link their apps to the Internet. However, this week's EU decision gives Spotify more flexibility in how it outlines subscription levels and pricing.
Apple gets 30% of revenue generated from app subscriptions through the App Store for the first year. The reduction drops to 15% for subscriptions that continue after a year. Apple introduced the fee in part to meet the needs of companies like Spotify.
With iOS 17.4, Spotify and other companies serving users in the EU will have new ways to compete with the App Store. Alternative marketplaces are officially supported under the Digital Markets Act.
However, Spotify's strategy so far has been to not play ball whenever possible, despite some policy changes aimed at supporting rival services. For example, Spotify doesn't take advantage of Siri integration on the iPhone or HomePod, even though Pandora and other services do.
Zoom out and it's easy to argue that Apple isn't subject to Apple's 15-distribution fee Music on iPhone at 30% is an advantage over Spotify. However, a $2 billion fine, which almost rivals the price Apple paid for Beats Music as the basis of Apple Music, seems far from a panacea.
If Spotify's goal is not to pay Apple any fees, then the goal of the platform provider and Apple is keeping its larger App Store business, there doesn't seem to be a real solution in sight.
