Spotify has submitted an update for its iPhone and iPad app in the App Store that should simplify how you purchase Premium subscriptions.
The Epic Games v. Apple legal battle in the United States has reached a ruling barring Apple from charging any commission fees on external purchases. Spotify has now confirmed it just submitted an update to its iOS app that will presumably take advantage of the ruling to simplify how customers purchase subscriptions.
“This landmark court ruling is a victory for developers everywhere,” Spotify spokesperson Jeanne Moran said in an emailed statement to tech news outlets like TechCrunch. “Spotify will move quickly to submit an app update to Apple, enhancing the experience for our consumers across the United States.”
Purchasing Spotify Premium subscriptions on iPhone
Spotify didn’t say what the planned update entails, but lower-cost payment options and better in-app purchasing sound probable in light of the latest ruling.
Spotify in 2019 filed an antitrust complaint against Apple with the European Union’s competition watchdog, accusing the iPhone maker of acting as both “a player and referee to deliberately disadvantage other app developers.” The main point of contention was, of course, the controversial 15-30 percent commission fee Apple imposes on purchases and subscriptions made within apps.
After the European Commission found Apple guilty of violating antitrust laws, fining the company over €1.8 billion, the iPhone maker made a rare exception but only for so-called reader apps like Spotify, Kindle or Netflix which provide access to digital content like music, books, video and more. Reader apps are exempt from standard App Store fees, but must adhere to other rules outlined on Apple’s support page, like agreeing to new commission fees on purchases made via external links.
Spotify responded by updating its iOS app to display prices of web subscriptions but no actionable links, as the company wouldn’t agree to Apple’s unfavorable rules for external purchases. It’s one of Apple’s stupidest rules. It demands that developers offering web subscriptions not promote them in-app. That’s why Netflix, which stopped using iTunes billing, offers no indication whatsoever in its mobile app to suggest how you can purchase a subscription online.
The App Store suffers a legal defeat
The 80-page Epic v. Apple ruling announced yesterday basically prohibits the iPhone maker from imposing commission fees on purchases made outside App Store apps. It also blocks the company from prohibiting developers from telling customers about cheaper web payments and linking to external sites via buttons.
The latest ruling is a result of Apple’s non-compliance with an earlier 2021 ruling, to which Apple responded by limiting developers to one button per app, imposing a 27 percent commission fee on web transactions originated from in-app links and implementing scare screens to dissuade people from transacting outside apps.
Apple is scheduled to hold an earnings call with investors after reporting quarterly results later today, and I’m betting Wall Street analysts will grill Apple’s leadership on the call about the kind of revenue impact the company is expected due to the ruling. The App Store’s revenue is recognized in Apple’s Services division, which accounts for almost one-quarter of its yearly revenue, with proceeds from in-app sales and subscriptions likely having the biggest impact on Services performance.