Calling out Apple $AAPL Music for poor design is one thing. Asking whether its business model is fully legitimate is a much, much more serious criticism.
Elizabeth Warren probed into the music streaming service’s operations in a speech (pdf) she gave in Washington yesterday (June 29), in which she criticized tech giants Google $GOOGL, Amazon $AMZN, and Apple at large for using their massive platforms ”to snuff out competition.” She used Apple Music as a specific example, noting that the Federal Trade Commission is currently investigating the streaming service for antitrust violations.
The Massachusetts senator added: “While Apple Music is easily accessible on the iPhone, Apple has placed conditions on its rivals that make it difficult for them to offer competitive streaming services.” Those conditions include Apple taking a 30% cut of in-app purchases that customers make on the iOS platform—meaning that other streaming services have to charge higher monthly prices for iPhone users or take on big losses. (Though Apple has recently reformed its charges.)
While companies like Apple have given us “disruptive technologies that changed the world,” they cannot close off opportunities for smaller competitors to try and do the same, Warren warned.
The senator has at least one enthusiastic ally: Spotify $SPOT, Apple Music’s main rival. In a statement more impassioned than even Warren’s own, Spotify spokesman Jonathan Prince told Recode:
You know there’s something wrong when Apple makes more off a Spotify subscription than it does off an Apple Music subscription and doesn’t share any of that with the music industry. They want to have their cake and eat everyone else’s too.
Apple has yet to respond to Warren or Spotify’s remarks.
