Apple Under Antitrust Scrutiny Over Just Launched Streaming Service
Just two weeks after launching its new Apple Music service, the world’s largest company is once again the subject of an antitrust complaints lodged with federal authorities. The latest probe into the tech giant has to do with its treatment of competing streaming music apps sold in the iTunes store. Apparently, several rival streaming services have complained to regulators that Apple takes too big a cut when their apps are sold on its iTunes platform. Apple takes 30 percent of all apps sold in the iTunes stores, and some companies are complaining that’s too high. While Apple Music is currently free, the service will cost $9.99 per month at the end of the free trial, a figure that has just about become standard for monthly streaming subscriptions. Because of the 30 percent they lose when their apps are purchased, rivals are complaining that they will likely have to bump up their monthly subscription fee, thus preventing them from competing on a level playing field.
Based on a number of complaints from Apple’s rivals, the Federal Trade Commission has begun looking at the issue, though a formal investigation has not been launched. The agency has scheduled a number of meetings with complainants, but it is not known whether an official probe will be called for. Requests for comment have gone unanswered from the FTC and Apple, and several attorneys contacted for comment were divided on whether Apple could face an antitrust action. Google also charges 30 percent for apps sold in the Google Play store, but complaints have not been lodged against it. That’s primarily because in addition to charging 30 percent, Apple also places restrictions on apps, including prohibiting companies from linking their websites from apps sold in Apple’s store. Companies can avoid the 30 percent payout to Apple if users stream online, but mobile users finding the app in the iTunes store would have no way of knowing that option is available.