European Shift: Responding to the DMA Law
As the Digital Market Act (DMA) comes into effect on March 7, Spotify, alongside tech giants Google, Apple, Meta, and others, gears up for significant service changes to comply with the new EU regulations. A notable move includes the introduction of Spotify’s own payment system within its iOS app for EU users.
DMA Impact on Spotify’s Strategy
With the implementation of DMA rules, prohibiting hidden commissions, Spotify is set to offer EU users the option to purchase premium subscriptions or switch from an individual plan to Duo or Family directly within the app—bypassing the App Store.
Apple’s 30% Commission Challenge
Spotify has criticized Apple’s 30% payment commission since 2016, challenging the tech giant’s in-app payment system. Last year, Spotify completely abandoned Apple’s payment system, and now, with the support for in-app payments, users can also buy audiobooks directly within the app without external links.
Fair Prices and Transparency
Spotify pledges “fair subscription and purchase prices without additional Apple commission (+30%).” The platform will display subscription prices and inform iOS users about offers and promotions within the app, a feature restricted by current App Store rules.
“Free Cheese” Dilemma
While these changes only apply to the EU, questions arise about how much lower Spotify’s commission will be and whether consumers will genuinely benefit from lower prices. Notably, this development adds another chapter to Spotify, Epic, and others protesting against the App Store’s rules, with Apple vehemently defending its business model and revenues, especially in regions like the US where legislation differs.
Stay tuned for further updates on this unfolding battle reshaping the landscape of digital marketplaces and app store policies.
