• Home
  • Apple
  • iOS
  • News
  • FTC Expands App Store Inquiry – Issues Subpoenas to Streaming Services

FTC Expands App Store Inquiry – Issues Subpoenas to Streaming Services

FTC Expands App Store Inquiry – Issues Subpoenas to Streaming Services

The Federal Trace Commission is reportedly expanding its inquiry into Apple’s 30% cut of subscription revenue earned through the App Store, as it is said to be issuing subpoenas to streaming music services that compete with Apple Music.

FTC Expands App Store Inquiry - Issues Subpoenas to Streaming Services

AppleInsider:

There is no word on exactly what information the commission is seeking with the subpoenas, which were reported by The Verge, or which services have received them. It’s likely that the list includes one or more of Spotify, Rdio, Rhapsody, and Tidal, the most prominent competition for Apple Music.

The FTC began looking at the App Store’s revenue sharing policy earlier this month, following complaints by competitors that Apple’s own streaming service launched with a decided pricing advantage.

Apple wets its beak to the tune of 30% off the top for any and all in-app purchases for apps downloaded via the App Store. This means services such as Spotify are forced to raise their subscription prices to compensate. (Spotify has recently been encouraging users to cancel their subscriptions placed via their iOS app, and to then re-enroll via the Spotify website at a cheaper subscription cost.)

App Store rules also prohibit apps from directing app users to their website to sign up there, in order to avoid giving Apple its 30% cut of the action. The FTC will likely look at that practice also. (Spotify sent emails to its users directing them to their website, getting around Apple’s in-app rules.)

Apple is a late-comer to the music streaming subscription game, competing with such companies as Spotify, Rhapsody and others.

Leave a Reply

Your email address will not be published. Required fields are marked *