Spotify is on the brink of challenging Apple with the impending implementation of new European regulations, the Digital Markets Act (DMA), slated to commence on March 7. This act aims to curb the power of digital “gatekeepers” and their potentially anti-competitive behaviors.
In anticipation, Spotify has unveiled several concept designs showcasing potential updates to its iOS app for European users. These updates include clear display of prices, subscription deals, and in-app purchase options, aligning with the DMA’s goals. The DMA specifically targets “anti-steering” practices, which have historically barred app developers like Spotify from directing users towards alternative payment or subscription methods. Moreover, it seeks to prevent platform owners, such as Apple in this case, from mandating the use of their proprietary payment services.
Although Apple has not yet outlined its strategy for adhering to the DMA, Spotify’s announcement is somewhat speculative. Apple still holds significant control over its platform, potentially impacting Spotify’s ability to fully exploit the DMA’s provisions.
Spotify remains optimistic, envisioning a future where users can effortlessly change plans, purchase individual audiobooks, and download the app through alternative means or sideloading. The company acknowledges this vision hinges on Apple’s compliance with the new regulations.
In a blog post, Spotify expressed its enthusiasm for the DMA, stating, “For years, Apple’s rules restricted us from informing users about pricing, offers, or purchasing methods. The DMA opens doors for us to share these details within the EU.”
Grey Journal has reached out to Spotify for confirmation on whether the features depicted in the mockups will be launched on March 7 and will update accordingly.
Gustav Gyllenhammar, Spotify’s vice president of markets and subscriber growth, in a discussion with The Verge, highlighted the potential impact of these changes, particularly in podcasting. Restrictions on iOS have limited Spotify’s ability to offer premium podcast content, but the DMA could change this landscape.
Despite recent setbacks, including show cancellations and workforce reductions in podcasting, Spotify remains committed to evolving its platform. Notably, the company has had a longstanding tussle with Apple, ceasing in-app subscription purchases in 2016 and discontinuing legacy App Store subscriptions last year.
In a related development, a Google executive admitted during the Epic v Google trial that Spotify paid no commission to Google when using its payment system.
Apple’s regulatory challenges span globally, from the Netherlands to the U.S. While the tech giant has made concessions like allowing in-app promotions and alternative payment processors, it typically offers a modest discount on App Store fees for digital purchases.