Spotify CEO Daniel Ek has taken another swing at Apple, saying he couldn’t have built the music streaming platform today because of the Cupertino, Calif.-based giant’s stranglehold on the tech sector.
In an op-ed for the MailOnline, Ek criticized Apple and other big tech companies, including Google and Amazon, for the way they treat developers and their de facto competitors.
“Today, Apple and Google are not just players, they are the rule-makers and gatekeepers of the mobile internet, controlling how more than 5 billion global consumers interact online,” Ek wrote.
Ek took to the MailOnline to lobby for the Digital Markets, Competition, and Consumers Bill (DMCC), which is currently making its way through the U.K. Parliament.
The bill would allow the U.K.’s Competition and Markets Authority (CMA) to set tough new rules on how big tech companies behave. It would tackle things like fake reviews and subscriptions that are difficult to break.
Fines for breaching the new rules could be as high as 10% of a company’s global revenue. In Apple’s case, that would represent a more than $39 billion fine, based on 2022 earnings.
“The present mobile environment is a far cry from the more open and level playing field that existed when I started building companies,” Ek said.
“It also makes me wonder whether launching a venture like Spotify would even be feasible today. My guess is no.”
In June, the world’s biggest tech companies, including Apple, Google, and Meta, argued the bill would create “significant business uncertainty” because it is too vague and would give regulators unreasonable power.
“These conditions create an extremely volatile regulatory environment risking significant disruption to the U.K. Economy, including by chilling investment,” the submission to the committee read.
‘A secret 30% tax on everything’
Ek’s comments are the latest in a recent press round where he has reminisced about the difficulties of starting his music streaming platform, which is now valued at $30 billion and boasts 220 million global subscribers.
Speaking to Steven Bartlett on the Diary of a CEO podcast, Ek said he initially thought a streaming service was a “terrible idea” in an age of proliferating pirated music. He later recalled how he lost all his hair and gained 30 pounds as he spent years trying to secure licensing agreements with some of Europe’s biggest record companies.
Now, Ek says, he is trying to persuade the government to push through the bill to help current startups become more competitive in the tech sector.
The main source of Ek’s ire was Apple, and in particular, the 30% fee the company charges some developers including Spotify for app sales, in-app purchases, and paying for a subscription. Google also charges some developers a 30% fee on its own app store.
Ek wrote in the MailOnline: “How many more startups would have succeeded and grown into successful businesses if Apple wasn’t extracting this rent and reaping massive rewards at the expense of the broader tech economy?”
Apple has said approximately 90% of developers on its app store don’t pay a commission to the company, while European developers who qualify for Apple’s small-business program and sell less than $1 million in digital goods and services pay a 15% commission.
Ek’s pursuit against Apple with the European Commission was previously narrowed in February to exclude a request for the removal of charges for digital goods and services. Apple says it has always embraced competition, with Spotify among its most popular third-party music streaming services.
“The App Store has helped Spotify become the top music streaming service across Europe, and we hope the European Commission will end its pursuit of a complaint that has no merit,” a representative for Apple told Coins2Day in a statement.
Ek has his own stakes in tech’s battle with Apple, whose music streaming service, Apple Music, is regarded as Spotify’s main competitor. The company has been in a lengthy dispute with Apple over how it sells audiobooks.
In response to Apple’s remarks, a representative for Spotify told Coins2Day: “Whatever success we’ve had at Spotify has happened despite Apple’s best efforts to sabotage our efforts, raise our costs, and gain an artificial advantage—first for Apple Music and now with audiobooks.”
Amazon, another company involved in the dispute, has its own streaming service challenging Spotify. Google is building its own subscription model through YouTube, which could cut into Spotify’s market share.
However, the Spotify cofounder is far from alone in criticizing what he perceives is a stranglehold on the competition by tech’s big players, which are worth trillions of dollars in combined market value.
Last year, Elon Musk delayed the launch of Twitter Blue, now X Blue, blaming Apple’s 30% commission. In an exchange on X last October, he said the fee was “literally 10 times higher than it should be.” He called it a “secret 30% tax on everything” that effectively fell on consumers.
In February, the Biden administration echoed Musk’s arguments, with the Commerce Department recommending Apple and Google “address limits on in-app purchasing,” including making developers use the iOS App Store or Google Play Store for any purchases. The companies told Bloomberg they disagreed with the findings.
There are some 5.5 million apps on the Google and Apple app stores.
Amazon, Google, and Meta didn’t immediately respond to Coins2Day’ s request for comment.
